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Bank of America Corporation

BAC Financial Banks Diversified

Bank of America Corporation’s revenue for fiscal 2025 (year ended December 2025) was $191.6 billion, down 2.46% from fiscal 2024.

Revenue
−2.86%
EPS
−13.9%
Free cash flow
−113.9%
Total debt
+2.31%

Quarter to September 2026, against a year earlier

49.96 0.20 +0.40%
Market cap
$343.4B
P/E
11.8×
Fwd P/E
11.4×
Dividend yield
2.32%
F-score
6/9
Altman Z
n/a
Beneish M
n/a
Dividend safety
n/a
Overview Business Profile Earnings & Analysis
Financials
Income Statement Balance Sheet Cash Flow Metrics & Ratios
Segments Valuation Filings

Bank of America Corporation (BAC) valuation and DCF model

What the price implies · reverse DCF

At $49.96 the price implies 13.9% a year of dividend growth, at a 9.0% cost of equity.

The dividend a share grew 14.6% a year over the last ten years, 7.2% over the last five. The price asks for close to its ten-year rate. Return on equity averaged 9.5% over ten years; the price implies 10.2% for good.

In December 2017 the price assumed 20.4% a year; Bank of America Corporation went on to grow the dividend a share 0.6% a year to FY2025.

Price implies
13.9%
Last 5 years, reported
7.2%
Last 10 years, reported
14.6%

The headline discounts the last twelve months’ the dividend a share at 9.0% for ten years and grows it 2.5% a year after that, the same for every company, so the figure compares across the market (how a reverse DCF works).

The other way round · DCF
The price needs
13.9% a year for ten years
$49.96
today’s price
Its base case
14.6% a year for five years, then 8.8%
$43.31
13.3% below today’s price

Both are growth in the dividend a share, discounted at 9.0%, with 2.5% a year after year ten.

Base case on its own ten-year record Bank of America Corporation’s own growth, carried forward

Its assumptions

Powerpack lets you start from a scenario and type over any of them.

The base case’s inputs, which Powerpack lets you change
1 · Dividends
the four quarters to September 2026, from the 10-Q and 10-K filings

Yearly growth in the dividend. It usually slows as the company matures.

Today’s price implies the dividend a share growing 13.9% a year for ten years.

2 · Rates

Cost of equity is the yearly return shareholders require, typically 8–11%. Terminal growth is growth forever after year 10, usually near long-run inflation, 2–3%.

3 · Per share

The model is a share’s own: no debt to take off and no shares to divide among.

Advanced inputs

Against Bank of America Corporation’s own cost of capital: risk-free 4.3% + beta 1.19 × equity premium 4.5% = 9.7% cost of equity; weighted, 9.7%.

Use 9.7%
Base case value per share $43.31 ten years discounted, and what follows
Current price $49.96 market price per share
Below today’s price 13.3% downside at the base case’s assumptions

How we got there$16.39 10 years of dividends+$26.92 terminal value=$43.31 per share

Valuation against its own history

Today’s multiple against its 5- and 10-year averages and the industry median (Banks Diversified).

Multiple Current 5Y avg 10Y avg vs 10Y avg Industry median vs industry 10Y range
P/E 11.76× 12.17× 12.97× 9% below 11.69× 1% above
P/FCF 8.74× 12.59× 14.72× 41% below 8.83× 1% below
P/B 1.30× 1.24× 1.25× 4% above 1.53× 15% below
P/E P/FCF P/B
1.03×1.20×1.36×1.53×10Y avg 1.25×2017201820192020202120222023202420252026

BAC trades at 1.30× P/B, against a 10-year average of 1.25× (range 1.02×–1.54×). That is dearer than 67% of the last 9 year-end readings; re-rating to the average implies $47.87 per share.

Every growth rate on this page is the business’s — its cash flow, FFO or dividend — never its share price’s. A discounted-cash-flow model is only as good as its assumptions. Figures from the 10-K and 10-Q filings. Not investment advice.