Shares were off slightly to $34.88.
Analyst Jason Goldberg said in a note to investors that he believed that the "substantial improvements" Bank of America has made in its consumer bank, its largest revenue source, and the benefits of recent technology advancements "are not fully appreciated by investors."
"We also expect further market share gains on the wholesale front," he said. "In addition, we expect expansions to remain contained, asset quality to stay benign and share repurchase to continue."
Goldberg also downgraded Wells Fargo (WFC) - Get Report to equal weight from overweight, saying the banking leadership has regressed since its retail banking sales practice issues came to light and it will take time to build momentum.
Wells Fargo is operating under a balance-sheet cap imposed by the Federal Reserve in February 2018 following a fake accounts scandal.
"While we have confidence in the new CEO Charlie Scharf and foresee meaningful improvement in its efficiency ratio over time," Goldberg said, "WFC saw the third largest increase in its P/E multiple our coverage. As such, it appears part of its expected turnaround has already been priced in."
Wells Fargo was down slightly to $53.15 in trading Monday.
While his price targets imply less upside heading into 2020 than 2019, Goldberg said he believes that U.S. large-cap banks continue to have the ability to rise and outperform the market.
Goldberg said that several uncertainties could factor into corporate-consumer confidence, economic growth, and the ultimate path of interest rates, including the U.S.-China trade conflict, weakness in manufacturing, and the upcoming presidential election.
He also said changes to loan loss reserve accounting could complicate matters.
On Friday, BMO Capital Markets analyst James Fotheringham downgraded Bank of America's stock to perform from outperform, saying he acted “on the basis of valuation exclusively."