Bank of America Profit BEATS Wall Street, Double Digit Revenue Growth

S&P 500 (NYSE:SPY) component Bank of America Corporation (NYSE:BAC) reported its results for the second quarter. Bank of America is a bank holding and a financial holding company which, through its subsidiaries, provides banking and other financial services and products to customers in the United States and abroad.

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Bank of America Corporation Earnings Cheat Sheet

Results: Reported a profit of $2.46 billion (19 cents per diluted share) in the quarter. The banks-major regional had a net loss of $8.83 billion or a loss of 90 cents per share in the year-earlier quarter.

Revenue: Rose 16.3% to $22.2 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Bank of America Corporation beat the mean analyst estimate of 15 cents per share. It fell short of the average revenue estimate of $22.87 billion.

Quoting Management: “In a challenging global economy, we still see opportunities to do more with our customers and clients. Lending to commercial businesses increased for the sixth straight quarter — with small business lending and commitments up 23 percent in a year — and consumer credit is in the best shape in years,” said Brian Moynihan, chief executive officer. “This quarter we surpassed 10 million mobile banking customers, up 34 percent in a year. With about 45,000 new mobile customers a week, we are adapting to meet customer needs and to do more with them.” “Once again, we had strong capital generation this quarter through a combination of earnings growth and a reduction in risk-weighted assets,” said Chief Financial Officer Bruce Thompson. “In one year, our Tier one common capital ratios have gone from being the lowest of the major U.S. banks to among the highest, and we’ve maintained our strong liquidity levels even as we reduced our long-term debt by $125 billion.”

Key Stats:

The company has now beaten estimates the last two quarters. In the first quarter, it topped expectations with net income of 31 cents versus a mean estimate of net income of 13 cents per share.

Revenue rose last quarter after dropping in the previous quarter. Revenue fell 17.7% to $26.93 billion in the first quarter from the year earlier.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the third quarter is 14 cents per share, down from 18 cents ninety days ago. At 55 cents per share, the average estimate for the fiscal year has fallen from 70 cents ninety days ago.

Competitors to Watch: Citigroup Inc., Wells Fargo & Company, JPMorgan Chase & Co., U.S. Bancorp, Goldman Sachs Group, Inc., Barclays PLC, Morgan Stanley, PNC Financial Services, KeyCorp, and American Express Company.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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