E = Earnings Are Increasing Quarter-Over-Quarter
A mature bank, such as Bank of America, is difficult to value, but can always be cut down to earnings and revenue growth. These numbers set guidelines for future expectations, which is widely used to value a stock. After all, the stock market thrives on expectations. A large bank has lots of intricacies so these numbers are not as significant as pure growth plays.
More importantly, meeting or exceeding expectations, or how the street feels about the numbers is the key factor. The last eight quarterly yoy earnings growth numbers for Bank of America have all been negative, while the last eight quarterly yoy revenue growth figures for the company have varied: -24.64 percent, -27.65 percent, 38.73 percent, -17.56 percent, 4.78 percent, 4.13 percent, -46.18 percent, and -14.38 percent.
How did the street feel about these numbers? Let’s take a look at the last four quarterly earnings announcement reactions in order to gauge investor sentiment on Bank of America’s stock. The last four quarters have seen next trading session returns of -4.24 percent, -0.21 percent, -4.93 percent, and -1.68 percent. It is clear that the markets are not happy with any of the numbers that this company is posting.