Bank of America Corp. shares BAC,
rose 1.1% in Tuesday’s pre-market trades towards an 11-month high after Citigroup analyst Keith Horowitz was optimistic, citing expectations that the third-quarter fund’s recovery in net interest income will be bigger than expected. Horowitz increased his rating to buy from neutral and the price of his shares from $ 31 to $ 37; the shares have not closed at $ 37 or above since October 2008. He said he believes BofA is one of the biggest beneficiaries of the capital return to shareholders (share buyback and dividends), which is expected to resume in the next quarter. “[BofA] it is also more leveraged for the consumer, who we believe will perform better in this credit cycle due to the stimulus programs “, wrote Horowitz. Shares rose 28.8% in the last three months until Monday, while SPDR Financial Select ETF sector XLF,
rose 21.6% and the S&P 500 SPX,
gained 7.5%. Horowitz also updated PNC Financial Services Group Inc. PNC,
and Bank of New York Mellon Corp. BK,
to buy from neutral.
