QS Research · Michael Burry's Scion Capital analyst template · 2006
BANK OF AMERICA CORP /DE/ (BAC)
As of 2026-11-06 · 12/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case +7% · downside -11% · upside +24%
BAC is a scale deposit franchise priced at 11.2x TTM earnings and 1.16x book with a 10.4% TTM ROE (N21-N23), and the 2026 selloff looks mostly like a dated reaction to a $1.2B non-tax-deductible AML settlement and related litigation rather than evidence of permanent earnings collapse; Q3 2026 adjusted EPS was $1.08 versus $0.91 reported, NII rose 8%, credit was stable and $8.3B was returned (S28, S98). Using section 13's TTM net income to common base of $30.76B (N14), a 12.0x fair multiple gives $369.1B, or +7.3% versus the $344.01B market cap (N9), while 10.0x gives $307.6B, -10.6%, and 13.9x gives $427.6B, +24.3%. The risk/reward is positive but the base case is below the +30% long threshold and the upside case is above the +25% short threshold, so this is a watch, not a long or short.
Key numbers
- Share price: $49.85
- Market cap: $344.01B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $120.16B
- P/E (TTM): 11.2x
- Price / book: 1.16x
The 15 boxes
- ✓ 1. Long-form business notes
BAC's source set is a financial-company file: FY2020-FY2025 revenue rose from $85.53B to $113.10B, pre-tax income from $19.00B to $37.70B and net income from $16.47B to $29.05B, while equity grew from $272.92B to $303.24B. The 10-K excerpts describe revenue as net interest income plus noninterest income from trading, investment banking, underwriting, wealth/advisory and deposit/lending activities, funded largely by deposits and capital-markets liabilities. The oldest FY2020 excerpt is dominated by pandemic risk and low rates; the latest FY2025 excerpt focuses on 2025 Fed rate cuts, tariff volatility, digital assets/stablecoin and GSE privatization uncertainty. The sources do not give segment revenue, unit economics or a one-off item breakdown.
- ✓ 2. Competitive advantage
BAC has a scale-and-licence advantage: at June 30, 2025 it held greater than 10% of U.S. insured depository institution deposits, a level that also blocks further U.S. deposit acquisitions under Riegle-Neal. Revenue rose every fiscal year FY2020-FY2025 from $85.53B to $113.10B, FY2025 net income was $29.05B, equity $303.24B and buybacks $21.43B, but the 10-K describes a highly competitive field of banks, nonbanks and internet firms competing on pricing, product range, technology and relationships. The sources do not give net interest margin, ROE, efficiency ratio or price/book, so the advantage reads as scale and regulatory position rather than a clearly durable pricing moat.
- ✓ 3. 10-Q takeaways
Q3 2026 revenue rose to $29.958B from $29.040B in Q3 2025 as NII increased, but net income fell to $6.933B ($0.91 diluted) from $8.332B ($1.04) on higher noninterest expense and lower noninterest income. The $1.2B non-tax-deductible regulatory settlement charge depressed Q3 2026 expenses, earnings and the effective tax rate. Credit was stable, loans and deposits grew, capital ratios declined, and liquidity remained large. The main new risk is the October 2026 OCC/FinCEN/OFAC AML/sanctions resolutions.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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