Bank Of America Algorithmic Stock Forecast
Bank of America Corporation (NYSE:BAC) is a household name in the United States and for good reason. By assets alone, it is the nation’s second biggest bank. By Forbes’ 2010 definition, it is the third largest company in the world. In 2008, it acquired Merrill Lynch Wealth Management, the world’s largest brokerage. Merrill Lynch itself represented an add-on of over $2.2 trillion client assets and over 15,000 financial advisors. In finalizing this merger, Bank of America became a leading provider of global corporate and investment banking services. Where numbers are concerned, BAC seems sufficient: it services 50 million customers, possesses 5151 banking centers, holds 16259 ATMs, operates within all 50 US states, and maintains a presence in more than 40 other countries.
Despite these solid statistics, BAC has faced continued controversies and lawsuits since 2008. The financial consequences and ethical implications of these events – particularly when taken alongside the United States housing crisis – make BAC a problematic investment, as I Know First Research confirms with its 1-month, 3-month, and 1-year forecasts.
The Past: Controversies & Lawsuits
As I have mentioned above, BAC did indeed have its strengths in the pre-2011 era, but a series of controversies and lawsuits have significantly hindered its success.
The first of these was the American International Group (NYSE:AIG) lawsuit against BAC in summer 2011, in which AIG found BAC and, its acquisitions (namely, Merrill Lynch and Countrywide), guilty of “massive fraud”. After AIG refused to accept Bank of America Corp.’s $8.5 billion settlement, BAC responded immediately, with spokesman Lawrence DeRita labeling his corporation free of culpability. However, negotiations continued until 2013 and 2014, when judges ruled against AIG. While BAC may have won that battle, its stock tumbled nearly 45% in 2011 as a result of ongoing legal issues.
Further lawsuits accompanied this one, including one filed just one month later by Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC), two government-sponsored enterprises (GSEs). They claimed that BAC had falsely represented the mortgage-backed securities it sold to these federal housing giants. Yet another suit in 2012 forced BAC to pay $2.4 billion to its shareholders, who felt they had been misled concerning BAC’s acquisition of Merrill Lynch. The US government also followed suit, filing a $1 billion civil lawsuit against the corporation for Countrywide’s alleged abuse of taxpayers, FNMA, and FHLMC. BAC also suffered slightly from its acquisition of Countrywide Financial: the latter group did not just have problematic mortgage portfolios, but was also accused of racial discrimination, and BAC incurred a bias suit as a result in 2011.
