final paper

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Final Paper on the Bank of America StockCompany Description and Mission
Bank of America is an American multinational financial and banking services company located in Charlotte, North Carolina. It was founded by Amadeo Peter Giannini in 1904. The Bank of America is the second biggest bank stock firm in the United States in regards to the assets. It is the 26th biggest corporation in the United States with regards to the total revenue, as per the 2016 reports (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). Bank of America was listed as the 11th biggest firm in the globe by Forbes. The company’s mission is to provide investment and lending products that enhance underserved middle-income and low-income populations, serve middle-income and low-income households and individuals, and establish sustainable acts for the long catch.
Products and International Operations
Bank of America offers its products and services via running 5,100 banking points, 16,300 ATMs, mobile and online banking sites, and call centers. The bank runs as a bank and financial stock company. It works via different divisions, including global markets, consumer banking, legacy assets and servicing, global banking, and global wealth and investment management. These segments provide different products and service. For example, the global banking unit handles the functions, such as lending, integrated working capital control and treasury alternatives to customers, and advisory and underwriting services (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1).

In California, the Bank has expanded by creating its first branch in 1909. It also acquired Seafirst Corporation of Seattle in Washington in 1983, outside California.
Main Competitors
The main rivals of the Bank of America Company are the three other large banking and financial services firms in the United States. These competitors include Wells Fargo, JPMorgan Chase, and Citigroup. The biggest of these four largest banks is the JPMorgan Chase by assets. Bank of America is the second, followed by Wells Fargo and Citigroup, in that sequence as per the 2015 reports (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1).
Stock Performance
The stock prices from 2005 to present have been good, in general. The price value has been decreasing from 2005 to 2016, indicating a good place for investors to place their money. The 2005 stock price was $54 while that of 2006 was averagely 47.03. Again, as of Dec 2007, the stock price was at $46.64, while that of December 2008 stood at $23.05. Similarly, the stock price dropped in 2009 to $19.48, and in December 2010, the price was $13.79. The price has also been reducing from 2011 to 2012 with a value of $9.94 and $6.64, respectively. However, the price increased in 2013 to $17.92 and again reduced to $15.65 in 2014. In 2016, the price stands at $21.50 (“Bank Of America | Investor Relations | Historical Price Lookup”1).
Industry Characteristics
A global deregulation trend has given rise to several new businesses to the financial institutions. Attaching his trend to the technological advancements, such as the ATMs and online banking, the banking sector is apparently trying to flourish. Many banks have billions of dollars in property and have many branches in various industries. The interest rate is determined by the U.S. Federal Reserve. Since the rates directly impact the loans, banks frequently attempt to forecast the next rate changes and, therefore, can adjust their rates. Also, the gap between the liabilities and assets also determines the profitability of these banks, especially with a positive gas and increasing interest rates (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). The interest rate fluctuations play a big role in the profitability of the banks. To avoid this reliance, the banks produce more revenue o fee-centered services so as to improve their returns on investment as compared to the rivals.
Mergers and Acquisitions
Bank of America loaned D. E. Shaw & Co. $1.4 billion in 1997 so as to operate different businesses for the bank. Nevertheless, D.E. Shaw realized a loss following the 1998 Russia bond nonpayment (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). The same year saw BankAmerica acquired by the NationsBank of Charlotte. From 2001 to date, several mergers have been conducted. Bank of America has formed mergers with FleetBoston Financial, a Boston-based bank in 2014. Furthermore, in 2005, 2006, and 2007 the bank formed mergers with MBNA, The United States Trust Company, and LaSalle Bank Corporation. These mergers improved the potential of the firm in the industry. For example, the mergers increased the customer base to 1.4 million retail clients, 1,500 ATMs, many branches across the U.S., 17,000 commercial bank customers, and 14 percent share of deposit, enabling it to outshine JPMorgan Chase. The bank has also conducted acquisition of other companies, including the Countrywide Financial in 2007 and Merrill Lynch in 2008 (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). On the other hand, the bank has been involved in a lawsuit of $27.5 million settlement following the breach of its agreement with consumer checking account holders and unlawful assessment and collection of the overdraft charges on some debit card activities. The judgment on the right party has not been determined by the Court.
Analysts’ Outlook
27 analysts providing one-year price projections for the bank have an average target of 19.0, with a big approximation of 25.0 and lowest value of 14.5. The average value shows a -10.50 percent decline from the past price of 21.23. Likewise, in 2015, the bank recorded a dividend of $0.2, which shows a 66.7percent rise over 2014 (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). The 23 analysts assessing the firm expect a dividend of $0.25 for the coming financial year, a rise of 24.5 percent. Again, the third quarter of 2016 earnings was reported as 0.41 per share. Concerning the revenues, the same quarter realized revenues of $21.86 billion. This was 4.54 percent increase over the last year’s third quarter outcomes. The 2015 total revenue was $84.24 billion. This shows 1.03 percent decrease over the last year (“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans” 1). The analysts predict that the company stock performance will continue improving into the future.
Investing in the Company
It is good to invest in the bank. The design and structure of stock of the bank are easy to understand. The shares are heavily transacted, and the investors should not worry about putting their money in the company. Because the analysts have given the lowest consensus rating of 1.9 of stocks as compared with other larger banks, it is good to invest in the company as the lower the rate, the better (“Bank Of America | Investor Relations | Historical Price Lookup”1).

Works Cited
“Bank Of America — Banking, Credit Cards, Mortgages And Auto Loans.” Bankofamerica.com. N.p., 2016. Web. 3 Dec. 2016.
“Bank Of America | Investor Relations | Historical Price Lookup.” Bank of America Investor Relations. N.p., 2016. Web. 3 Dec. 2016.