BAC has fallen steeply since we downgraded it, as it underperformed the S&P 500 significantly.
Is the selloff appropriate? At its recent highs, yes, because there was too much optimism over its NII growth that's likely to level off in 2023.
Hence, the market has likely focused on whether BAC's current valuation is appropriate for a recession.
But, investors need to ask whether the market has priced in a significant recession?
We explain why after the recent selloff, we are more constructive over its recovery.
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