Bank of America Return On Asset vs. Net Income
| BOFA Stock | 24.88 0.12 0.48% |
For Bank of America profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Bank of America to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Bank of America utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Bank of America's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Bank of America over time as well as its relative position and ranking within its peers.
Bank |
Bank of America Net Income vs. Return On Asset Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Bank of America's current stock value. Our valuation model uses many indicators to compare Bank of America value to that of its competitors to determine the firm's financial worth. Bank of America is rated third in return on asset category among its peers. It is number one stock in net income category among its peers making up about 3,632,191,780,822 of Net Income per Return On Asset. At present, Bank of America's Net Income is projected to decrease significantly based on the last few years of reporting. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Bank of America's earnings, one of the primary drivers of an investment's value.Bank Net Income vs. Return On Asset
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Bank of America |
| = | 0.0073 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
Net income is the profit of a company for the reporting period, which is derived after taking revenues and gains and subtracting all expenses and losses. Net income is one of the most-watched numbers by money managers as well as individual investors.
Bank of America |
| = | 26.52 B |
Because income is reported on the Income Statement of a company and is measured in dollars some investors prefer to use Profit Margin, which measures income as a percentage of sales.
Bank Net Income Comparison
Bank of America is currently under evaluation in net income category among its peers.
Bank of America Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Bank of America, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Bank of America will eventually generate negative long term returns. The profitability progress is the general direction of Bank of America's change in net profit over the period of time. It can combine multiple indicators of Bank of America, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Net Interest Income | 56.9 B | 53.8 B | |
| Interest Income | 130.3 B | 82.1 B | |
| Net Income From Continuing Ops | 26.5 B | 28.9 B | |
| Income Before Tax | 28.3 B | 31.9 B | |
| Net Income Applicable To Common Shares | 29.9 B | 27.2 B | |
| Net Income | 26.5 B | 28.9 B | |
| Income Tax Expense | 3.1 B | 2.4 B | |
| Change To Netincome | 14.5 B | 10.6 B |
Bank Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Bank of America. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Bank of America position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Bank of America's important profitability drivers and their relationship over time.
Use Bank of America in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Bank of America position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bank of America will appreciate offsetting losses from the drop in the long position's value.Bank of America Pair Trading
Bank of America Pair Trading Analysis
The ability to find closely correlated positions to Bank of America could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Bank of America when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Bank of America - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Bank of America to buy it.
The correlation of Bank of America is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Bank of America moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Bank of America moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Bank of America can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Bank of America position
In addition to having Bank of America in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Candy and Soda Thematic Idea Now
Candy and Soda
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Candy and Soda theme has 13 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Candy and Soda Theme or any other thematic opportunities.
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To fully project Bank of America's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Bank of America at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Bank of America's income statement, its balance sheet, and the statement of cash flows.