Bank of America (NYSE:BAC) Earnings Should Reach $40 Billion Annually

Believing the worst is being Bank of America (NYSE:BAC), FBR said they see the giant bank generating over $40B billion in pretax, pre-provision earnings on an annual basis.

FBR says, "...We estimate BAC has about $2B–$4B of reserves available for claims, so there is probably -$6B–$8B of charges remaining. While this is clearly an overhang on the stock, we believe the "doomsday" scenario is essentially off the table and the company should be able to earn through it with $40B+ in pretax, pre-provision earnings annually. We are maintaining our FY11E GAAP EPS of $1.30, but increasing our operating EPS to $1.38 from $1.20, as we are backing out repurchase-related claims from core. We are also introducing our FY12E GAAP and operating EPS of $1.90 and increasing our normalized earnings estimate to $2.75 from $2.60."

FBR Capital maintains an "Outperform" rating on Bank of America (BAC), which was trading at $13.98, down $0.27, 1.86 percent, as of 12:58 PM EST. FBR has a price target on Bank of America of $18.