Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. Trade-Ideas LLC identified Bank of America Corporation ( BAC) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Bank of America Corporation as such a stock due to the following factors:
- BAC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $1.7 billion.
- BAC has a PE ratio of 42.2.
- BAC is currently in the upper 30% of its 1-year range.
- BAC is in the upper 25% of its 20-day range.
- BAC is in the upper 35% of its 5-day range.
- BAC is currently trading above yesterday's high.
- BAC has experienced a gap between today's open and yesterday's close of 0.6%.
'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills. EXCLUSIVE OFFER: Get the inside scoop on opportunities in BAC with the Ticky from Trade-Ideas. See the FREE profile for BAC NOW at Trade-Ideas More details on BAC: Bank of America Corporation, through its subsidiaries, provides various banking and financial products and services for individual consumers, small and middle market businesses, institutional investors, corporations, and governments in the United States and internationally. The stock currently has a dividend yield of 0.3%. BAC has a PE ratio of 42.2. Currently there are 8 analysts that rate Bank of America Corporation a buy, 2 analysts rate it a sell, and 14 rate it a hold. The average volume for Bank of America Corporation has been 122.0 million shares per day over the past 30 days. Bank of America has a market cap of $150.1 billion and is part of the financial sector and banking industry. The stock has a beta of 1.92 and a short float of 1.1% with 1.01 days to cover. Shares are up 23.3% year to date as of the close of trading on Wednesday. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more. TheStreetRatings.com Analysis: TheStreet Quant Ratings rates Bank of America Corporation as a hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet. Highlights from the ratings report include:
- BANK OF AMERICA CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, BANK OF AMERICA CORP turned its bottom line around by earning $0.25 versus -$0.02 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.25).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Financial Services industry. The net income increased by 127.1% when compared to the same quarter one year prior, rising from $653.00 million to $1,483.00 million.
- Net operating cash flow has significantly increased by 269.63% to $26,468.00 million when compared to the same quarter last year. Despite an increase in cash flow of 269.63%, BANK OF AMERICA CORP is still growing at a significantly lower rate than the industry average of 605.96%.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Diversified Financial Services industry and the overall market, BANK OF AMERICA CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The debt-to-equity ratio is very high at 2.40 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
- You can view the full Bank of America Corporation Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.