Rationale for Investing in Bank of America

Rationale for Investing in Bank of America

Rationale for Investing in Bank of America.

Rationale for Investing in Bank of America: As a financial manager of Dimes Finance Consultants Company (imaginary), the name Bank of America (or BAC) has occupied the top slot with regard to potential investment since the globe was hit by the financial crisis, especially throughout 2011, for a range of reasons.

BAC’s shares fell to $5 each during the darkest hours of the European debt uncertainties of 2011, implying that BAC’s stock is highly responsive to panic (CNNMoney, 2010).

As a norm, value investors benefit from panic and, given the relatively recent slump in BAC’s stock, I would advise my client to consider investing in BAC with a view of riding its recovery.

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banking are recently adapted strategies by the bank. Such strategies among others increase customer satisfaction which enhances their royalty and retention.

The corporate social responsibility is one of aspects highly upheld by Bank of America. The bank has set aside about $ 50 billion so as to support various projects aimed at environmental conservation and efficient utilization of natural resources. This amount is shared on various projects concerned with energy, water and forest conservation.

The financial performance of the company is encouraging. The revenue amount as well as the net profit has improved over the three years. The company should however; address the issue of high number of days revenue is converted into cash. The company should also address its gearing status to reduce the threat of liquidation.


Bank of America. Our history and heritage. Accessed December 11, 2013,

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