FBR Capital raised its price target on Bank of America Corp (NYSE: BAC) from $20.00 to $2.00 following better than expected earnings results on Friday. FBR also reiterated its “outperform” rating for the Charlotte, N.C.-based bank.
FBR said that the biggest takeaways are: “(1) credit continues to stabilize with reserve releases likely to continue, (2) fixed income was much stronger than we were expecting and we have increased our expected contribution from this business moving forward, and (3) fee income pressures will be greater than we expected.”
FBR raised its FY2010 earnings per share to $0.90, up from $0.70 because of lower credit costs which are partially offset by lower deposit fee income. FBR also lowered its FY2011 EPS estimate to $1.45, down from $1.60 resulting in lower fee income.
