Bank of America has released its list of top banks, assigning price objectives for nine financial institutions based on fiscal 2026 earnings projections and estimates of tangible book value at the end of 2026. The firm’s valuations use a methodology that emphasizes forward price-to-earnings multiples and price-to-tangible-book multiples, compared with historical averages and anticipated performance improvements.
Methodology and framework
The valuation framework BofA applies combines forward-looking earnings estimates for fiscal 2026 with projected tangible book values at the end of 2026. Targets are expressed as price objectives derived from applying specific price-to-earnings multiples and price-to-tangible-book multiples to those 2026 estimates. Where applicable, the firm contrasts the applied multiples with the five-year pre-pandemic medians to show how the market is valuing capital efficiency, return on equity characteristics, and relative credit risk.
Individual bank assessments
BNY - Bank of America set a $142 price objective, applying 18 times fiscal 2026 estimated earnings and 3.8 times year-end 2026 estimated tangible book value. Those multiples sit above the bank’s five-year pre-pandemic medians of 13.1 times and 3.1 times. BofA notes the higher multiples reflect a capital-light, high return on equity franchise with limited credit risk and sticky client relationships. BofA flags upside from stronger equity and bond markets and downside from severe market selloffs that could weigh on fee growth and on merger and acquisition activity that might limit capital returns. Recent company moves include executive leadership changes to align its wealth solutions business, and BNY has issued $1.55 billion in senior notes.
Citigroup Inc - $140 price objective. BofA applies 13 times fiscal 2026 estimated earnings and 1.4 times year-end 2026 estimated tangible book value. Those multiples exceed Citigroup’s historical averages of 10 times price-to-earnings and 1.0 times price-to-tangible book value, driven by expectations for accelerating earnings growth. BofA outlines downside risks including execution challenges from franchise transformation, macroeconomic deterioration, higher regulatory costs, and regulatory changes. Upside could come from faster share buybacks and stronger-than-expected operating leverage. Citigroup has formed a specialized banking team focused on artificial intelligence infrastructure deals and was selected by BlackRock to provide services for $4.0 trillion in U.S. iShares ETFs.
Cullen/Frost Bankers Inc - $163 price objective. BofA uses 16 times fiscal 2026 estimated earnings and 2.4 times year-end 2026 estimated tangible book value, slightly above five-year pre-pandemic medians of 15.3 times and 2.3 times. The firm highlights downside risks including worse-than-expected credit losses, larger-than-anticipated net interest margin compression, and slower economic growth. Cullen/Frost reported fourth-quarter 2025 earnings per share of $2.56 on revenue of $603.38 million, which exceeded analyst expectations.
East West Bancorp, Incorporated - $140 price objective. BofA applies 14 times fiscal 2026 estimated earnings and 2 times year-end 2026 estimated tangible book value. These multiples are below five-year pre-pandemic medians, reflecting heightened uncertainty about the bank’s earnings outlook and expected return on tangible common equity. East West Bancorp reported fourth-quarter 2025 earnings per share of $2.55, beating analyst expectations.
Fifth Third Bank - $60 price objective. BofA assigns 14.5 times fiscal 2026 estimated earnings and 2.3 times year-end 2026 estimated tangible book value. Fifth Third Bancorp has completed its merger with Comerica Incorporated, creating what BofA describes as the ninth-largest U.S. bank by assets.
Goldman Sachs - $1,100 price objective. BofA assigns a $1,100 target. Goldman Sachs was selected, alongside Bank of America, to work on the initial public offering for Mavis Tire Express Services Corp., a transaction that could raise approximately $2 billion.
JPMorgan Chase & Co. - $362 price objective. BofA set a $362 target. Recent activity noted includes JPMorgan providing a credit facility of approximately $100 million to Archer Meat Snacks to support the company’s expansion. The bank also received an Outperform rating reaffirmation from Keefe, Bruyette & Woods.
Morgan Stanley - $220 price objective. BofA applied a $220 target. Morgan Stanley reported record net revenues of $70.6 billion for 2025 and has applied for a national trust bank charter to custody digital assets for its clients.
The PNC Financial Services Group, Inc. - $270 price objective. BofA assigned a $270 price objective. PNC reported fourth-quarter 2025 core earnings per share of $5.01, which exceeded analyst expectations and prompted price target increases from several firms.
Summary of BofA’s outlook
BofA’s list emphasizes differences in business mix, capital efficiency, and earnings visibility across the sector. The firm’s use of fiscal 2026 earnings and year-end 2026 tangible book values as the valuation base allows direct comparison of how multiples applied today compare with pre-pandemic medians. For several names, BofA’s applied multiples exceed historical medians, reflecting expectations for higher returns and lower credit volatility; for others, applied multiples are conservative, reflecting uncertainty around earnings trajectories.
Key points
- BofA set price objectives for nine U.S. banks using fiscal 2026 earnings and year-end 2026 tangible book values, applying forward P/E and price-to-tangible-book multiples against historical medians.
- Applied multiples vary by bank, with some above five-year pre-pandemic medians and others below, signaling differences in expected capital efficiency and earnings visibility.
- BofA identifies specific upside and downside factors for each bank, including market-driven impacts on fee growth and merger activity, execution risks from transformation programs, and regulatory considerations.
Risks and uncertainties
- Market volatility - Severe selloffs in equity and bond markets could reduce fee revenue and slow M&A activity, impacting fee-dependent banks and capital return plans.
- Execution and regulatory risk - Transformation efforts and potential regulatory changes could raise costs or complicate execution, affecting banks undergoing franchise changes.
- Credit and margin pressures - Higher-than-expected credit losses or unexpected compression in net interest margins would weigh on earnings for banks exposed to credit cycles and rate movements.
These risks influence different sectors of the economy and markets, including investment banking and capital markets fees, wealth management fees, commercial lending portfolios, and broader investor sentiment tied to bank capital returns.