Post Q3, Which Bank Has the Edge: Bank of America or PNC Financial?

Bank of America BAC and PNC Financial Services PNC are two leading U.S. banks with extensive national footprint. BAC benefits from its massive scale, diversified business mix and technology-driven efficiencies, while PNC stands out for its disciplined growth strategy and focused regional expansion. Both possess unique strengths as they navigate a shifting interest rate environment and an evolving regulatory landscape.Bank of America and PNC Financial reported impressive third-quarter 2025 results earlier this month. Both banks’ earnings and revenues witnessed year-over-year growth and beat the Zacks Consensus Estimate. Let’s take a closer look at these two large banks to see which one is a better bet post third-quarter earnings.The Case for Bank of AmericaBank of America, the second-largest bank in the United States, is expected to witness solid net interest income (NII) growth this year and in 2026 as the Federal Reserve lowers rates. The company is also likely to benefit from asset repricing, technological efficiency and a diversified business model. Hence, NII is expected to rise 5-7% in 2025 and 2026.Additionally, BAC is prioritizing organic, domestic growth through the expansion of its physical and digital presence. This is part of a broader strategy to solidify customer relationships and tap into new markets, driving NII over time. By 2027, the company plans to expand its financial center network and open more than 150 centers. With growing use of tools like Zelle and AI assistant Erica, the company is boosting digital engagement and cross-selling products like mortgages, auto loans and credit cards.Also, Bank of America’s investment banking (IB) business has rebounded solidly in the third quarter, driven by an industry-wide rise in deal-making activities. Alastair Borthwick, executive VP and CFO, stated that the bank has a strong pipeline and the current environment remains favorable for M&As. He also pointed to significant investments made in the IB franchise over the past years as part of its growth strategy, which have been supporting the business.The Case for PNC FinancialSimilar to BAC, PNC Financial expects momentum in NII to continue, driven by loan growth, asset repricing, deposit growth, market expansion, operational efficiencies and stable funding costs. Management projects roughly 6.5-7% NII growth for 2025, with momentum expected to continue into 2026 and more than $1 billion growth forecasted.In September, PNC entered into a definitive agreement to acquire FirstBank Holding Company, which will support its strategy of scaling its franchise and expanding in high-growth markets, particularly in Colorado and Arizona. Leveraging FirstBank’s strong local customer relationships, the company aims to strengthen its corporate and private banking business in Colorado and Arizona.Like Bank of America, PNC Financial has announced plans to enhance its coast-to-coast branch network. By 2029, the company plans to invest $1.5 billion in opening more than 200 new branches across 12 U.S. cities and renovating 1,400 existing locations.Moreover, PNC has been diversifying its business through collaborations and acquisitions. In mid-2025, it acquired Aqueduct Capital Group, which will support its IB business. Last year, the bank partnered with Plaid to enable secure data sharing and expanded its TCW Group alliance to offer private credit to middle-market firms. Such efforts have helped diversify the company’s business mix, aiding its bottom line.BAC & PNC: Price Performance, Valuation & Other ComparisonsThis year, shares of Bank of America have gained 20.3%, while PNC Financial has lost 5.1%. BAC & PNC YTD Price Performance Image Source: Zacks Investment ResearchFurther, BAC has outpaced the S&P 500 Index’s rally of 18.3%. In terms of investor sentiments, Bank of America clearly has the edge.In terms of valuation, BAC is currently trading at a 12-month forward price-to-earnings (P/E) of 12.53X, while the PNC stock is currently trading at a 12-month forward P/E of 10.54X. P/E F12M Image Source: Zacks Investment ResearchFurther, both are trading at a discount compared with the industry average of 14.77X. So, Bank of America is expensive compared to PNC.After clearing the 2025 stress test, BAC and PNC announced a hike in their quarterly dividends. Bank of America increased its dividend by 8% to 28 cents per share, while PNC Financial announced a 6% rise in quarterly payout to $1.70 per share. At present, BAC's dividend yields 2.12%, which is less than PNC Financial’s 3.72%. Dividend Yield Image Source: Zacks Investment ResearchBank of America’s return on equity (ROE) of 10.76% is below PNC’s 11.47%. This reflects that PNC Financial is more efficiently using shareholder funds to generate profits.ROE Image Source: Zacks Investment ResearchBank of America & PNC Financial’s ProspectsThe Zacks Consensus Estimate for BAC’s 2025 and 2026 revenue implies year-over-year growth of 6.8% and 6%, respectively. The consensus estimate for earnings indicates a 14.9% and 14.5% rise for 2025 and 2026, respectively. BAC Earnings Estimate Image Source: Zacks Investment ResearchMeanwhile, the Zacks Consensus Estimate for PNC’s 2025 and 2026 revenue implies year-over-year growth of 6.8% and 7.6%, respectively. The consensus estimate for earnings indicates a 13.9% and 11.5% rise for 2025 and 2026, respectively.  PNC Earnings Estimate Image Source: Zacks Investment ResearchBAC or PNC: Which Bank Deserves a Spot in Your Portfolio Post Q3?Bank of America and PNC Financial present compelling long-term investment opportunities, though their strengths appeal to different types of investors. Bank of America’s vast scale, digital innovation and improving earnings trajectory position it to benefit from sustained economic growth and shifts in monetary policy.In contrast, PNC attracts more conservative investors through its higher dividend yield, disciplined lending practices and focused regional expansion. While both institutions are adapting to an evolving digital and regulatory landscape, Bank of America’s broader diversification and stronger growth outlook give it a modest advantage for investors prioritizing long-term capital appreciation.Currently, BAC and PNC carry a Zacks Rank #3 (Hold). 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Click to get this free report Bank of America Corporation (BAC): Free Stock Analysis Report The PNC Financial Services Group, Inc (PNC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks