Bank of America (NYSE:BAC) stock has come roaring back from the brink, and over the past 12 months is up 65%, substantially outpacing both the S&P 500 and most bank stocks as well over the same time period. Many analysts also have a buy rating on the stock. Is the stock cheap here, or will it pause to consolidate it gains?
Cheap Based on Forward P/E?
Bank of America currently trades at 10.0x consensus projected 2014 earnings per share. While this is cheaper than the S&P 500, BAC trades is more expensive on a forward P/E basis than both JPMorgan Chase (NYSE:JPM), Citigroup (NYSE:C), and trades about in line with Wells Fargo (NYSE:WFC). I pick this peer group because these four banks are far and away the largest banks in the U.S., each has a national footprint, and combined they control over 60% of all deposits held in U.S. banks.
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