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Bank of America 'Close to Fair Value': Analyst

The company's prospects for its Merrill Lynch subsidiary look bright, with management indicating in a recent meeting with O'Connor that the expansion of profit margin for its wealth management business was continuing in the second quarter.

Bank of America is also, like most banks, focusing on cutting expenses. The bank expects its "Project New BAC" to lead to annual cost savings of $1.5 billion by the end of 2014, although O'Connor wrote that many investors "assume a more meaningful decline in core costs over the next few quarters."

"From here, BAC shares should perform in line/slightly better than banks overall so long as the macro/monetary policy theme continues and/or cap markets revenue are better than expected," O'Connor wrote.

BAC Chart BAC data by YCharts

Interested in more on Bank of America? See TheStreet Ratings' report card for this stock.

-- Written by Philip van Doorn in Jupiter, Fla.

>Contact by Email.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.
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