Tomahawk, WI 01/15/2014 (BasicsMedia) –  Bank Of America Corp (NYSE:BAC), being the second largest bank in U.S., is always in the watch-list of many finance investors. The bank has come a long way into being a profitable company that it is today. Analysts expected its Q4 to have a lot of bearing n its future.

As bank that is making impressive progress recovering from the financial crisis shock, Bank Of America is keen on laying solid ground for its future and this effort has taken different approaches. The bank is currently consolidating after years of empire-building and this appears to be a sure way that the company believes will get it back on track quickly.

The bank is also curbing expenses in various ways to ensure that it continues to turn profits even under the current low-revenue growth condition. This strategy has high success chances especially looking at the latest performance of its peer Well Fargo Co. (NYSE:WFC). The mortgage-major bank managed to post impressive profit growth of 10 percent for its Q4 released this week, even when its revenue declined year-over-year basis. This strong growth was fueled by among other things cost reduction through job cuts.

Bank Of America Corp (NYSE:BAC) is also doing the same. The bank is cutting workforce and reducing location presence as it takes operations online and on mobile. All these efforts are aimed at cutting operating cost and boosting profits. This essentially means that the bank can continue posting earnings growth even if significant revenue growth is not realized. We saw this happening in Q3 when the bank posted more than 11 percent earning growth.

Revenue increase

Increasing revenue remains the ultimate goal of Bank Of America Corp (NYSE:BAC). It can be seen that as regards cost reduction, the bank is doing well. However, after curbing expenses, the bank needs to expand revenue in order to return big value to investors.

BAC is trying to expand revenue by going big on wealth management which is one segment that has shown a lot of growth potential. Perhaps it should be recalled that BAC has the most vibrant wealth management business. The management has repeatedly said that they are looking to wealth management to fuel fast-turnaround in the company. We can expect to see this happen as the ban continues to add more customers and introduce new products in this segment.

Impact of Q4 earning

Bank Of America Corp (NYSE:BAC) has done enough, if not a lot, to earn investor confidence. For any business, especially a turnaround stock, it’s a good thing to win over the confidence of investors. That the CEO Brian Moynihan has decided to pursue creating good relation with investors suggest that he is sure on what investors want in the company.

That being said, Bank Of America is beyond getting burnt due to any short-term disappointment in its performance. Instead, investors now know that the bank’s balance sheet is now solid and that very soon the bank will start paying hefty dividend and buying back shares.

Analysts are looking forward to the bank paying dividend in the range of 6 – 10 cents quarterly given its current financial position. It was wise that the management clung on low dividend so that they could achieve not only long-term, but also progressive dividend payout going forward.

Bottom line

That Bank Of America Corp (NYSE:BAC) is fast getting its legal challenges to the rear view mirror and consolidating assets are particular strength points which investors should be excited about. Moreover, the expected boom in its investment segment coupled with ongoing curbing of expenses should usher in massive gains for investors. Also, the expected improvement in mortgage market should also result in revenue growth for the company. As such, regardless of a weaker or stronger Q4, Bank Of America is a perfect stock to hold for the long-term.

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