Bank of America Corp: The Most Important Goal

By Matt Koppenheffer and David Hanson – May 20, 2014 at 1:23PM

NYSE: BAC

Bank of America

Market Cap

$302B

Today's Change

(-0.13%) -$0.05

Current Price

$38.32

Price as of April 24, 2024, 4:00 p.m. ET

Bank of America's returns on equity need to creep higher to keep investors interested.

Bank of America's (BAC -0.13%) long-term goal for its return on tangible equity is 14%. However, to due to recent issues with its capital and dividend plan, the bank may fall short of its 2016 goal.

By retaining more capital on its balance sheet, Bank of America will have to boost earnings even more to reach that goal. In the following video, Motley Fool banking analysts David Hanson and Matt Koppenheffer discuss Bank of America's goals, which banks have a good history of deploying capital at opportune times, and why B of A gets unfairly tagged as a "bad bank."

David Hanson has no position in any stocks mentioned. Matt Koppenheffer owns shares of Bank of America and Citigroup. The Motley Fool recommends Bank of America and Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, and Wells Fargo and has the following options: short June 2014 $50 calls on Wells Fargo and short June 2014 $48 puts on Wells Fargo. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.