Goldman Takes BofA to Top Rating, Doubles Target (BAC, GS)

Bank of America Corporation (NYSE: BAC) is getting a rather strong bid in early trading this morning.  Goldman Sachs raised its rating on the largest bank by deposits to the “Conviction Buy List.”

On top of the bank landing the top spot for the firms ranking system, the price target for Bank of America was set at $15.00.  That is more than 100% higher than its prior $7.00 target.

It seems that Goldman Sachs noticed that the bank has been able to raise private capital and sees that the process is ongoing.  Another positive aspect is the mortgage market as the banking giant has been busy with refinancing mortgages since early February, and the underwriting unit has seen its fair share of the rapid increase in bond offerings of late.

When you see major brokerage firms, or the new bank holdings companies, raise their ratings on each other it is hard to not wonder how much of the upgrade is really based on the strong business at the firm that is making the upgrade.  Stranger things have happened.

Bank of America shares are up 7.5% right around the $11.50 mark.

JON C. OGG