Tomahawk, WI 01/07/2014 (BasicsMedia) – Bank of America Corp (NYSE:BAC) is the second largest lender in the U.S. with assets in excess of $2 trillion. The bank also had arguably the best performance last year and even its start in 2014 is so far impressive. Nonetheless, some investors have had question’s regarding investment opportunities in the stock, more so given that the bank has continued to pay penny dividend when its peers have raised their payouts in this category.

It is therefore important to take a closer look at the stock and why investors need not worry at this point. Note that Bank of America Corp (NYSE:BAC) had the highest stock growth over the past year, rising more 45 percent. That rise did not just happen, it was earned. The bank has been busy cutting cost and selling assets to streamline operations. So far its balance sheet is in a perfect form.

In this position, it is for the bank to get away with a dividend increase request. Note that in 2011, the bank tried to have its dividend cap lifted but failed largely because it still had a lot of work to do in its balance sheet, most of which have now been accomplished.

That Bank of America Corp (NYSE:BAC) is out of danger is also supported by the resent upgrade from Citigroup (NYSE:C). Citi raised the target price on the stock to about $19 per share and recommended a buy rating from its previous neutral rating on the stock. Note that Citi is giving solid reasons for its decision to upgrade the stock.

It says that Bank of America Corp (NYSE:BAC) currently has few uncertainties, this is another way to say that the bank is clear of the shock of financial crisis. As if that is not enough, Citigroup (NYSE:C) goes ahead to say that looking at the strong recovery of the U.S. economy, there is no doubt that the exposure of Bank of America Corp (NYSE:BAC) puts it in a good position towards huge gains.

It is not difficult to see why Bank of America Corp (NYSE:BAC) is in solid grounds. The company is doing well with its plans to save $2 billion every quarter in costs by 2015. Note that so far the bank is saving about $1.4 billion per quarter, which means that it is already realizing 70 percent of its cost cutting target.

The bank is also reducing its workforce as part of the cost-cutting efforts. Note that Bank of America Corp (NYSE:BAC) also taking its operations online and on-mobile which not only help in reducing branch expenses, but also improves its service delivery, thereby winning it more customers.

Bank of America Corp (NYSE:BAC) is also selling its non-core assets, this is good for its streamlining and already there are a lot of benefits to show for this.

That the bank has decided to face its legal challenges head on is also good for its future. The settlements that it is currently making may be eating into its cash reserve, however, they are buying its peaceful business future. Without the string of cases, Bank of America Corp (NYSE:BAC) is expected to focus on core businesses, increase revenue and boost profits and return more money to investors in form of dividends and shares buyback.

Bottom line

Nothing should scare investors away from this stock. The issue of penny dividend is tool trivial an issue that should distract investors from reaping the potential benefits that Bank of America Corp (NYSE:BAC) presents.

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