Better Buy: Bank of America vs. Wells Fargo
On the surface, Bank of America (NYSE: BAC) and Wells Fargo (NYSE: WFC) look pretty similar. Both are mega-banks, they survived the 2008 financial crisis, and they're market leaders. But Wells has had some embarrassing missteps over the past few years, and that is the biggest difference between the two. Is the valuation difference big enough to overlook those issues? Read on.
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Wells Fargo and Bank of America trade at reasonably similar multiples, Bank of America at 12.6 times 2019 earnings and Wells at 11.9 times. When you look at 2020 price-to-earnings ratios, Bank of America is trading cheaper, at 11.5 times 2020 earnings versus 11.9 times for Wells. But Bank of America is expected to grow earnings per share (EPS) at 11%, while Wells is under 1%.
Source Fool.com