A Citi analyst on Tuesday lowered his investment rating on Bank of America Corp. after a recent rise in the company's share price, saying he believes other analysts are too optimistic in predicting profit growth over the next two years.
Keith Horowitz cut his rating to "Neutral" from "Buy," even as he raised his target price for the Charlotte, N.C.-based bank by 50 cents to $8.50.
Bank of America shares fell 26 cents, or 3.2 percent, to $7.99 in morning trading Tuesday.
A Bank of America spokesman said the company had no comment on the downgrade.
Its shares have risen lately because investors think the stock is less risky, and are more comfortable with Bank of America's capital levels, Horowitz said. Shares of financial institutions have risen broadly lately due to signs that the U.S. economy is improving and because European politicians and officials are working on a solution for Europe's debt crisis. Bank of America's stock is up 48 percent this year, after losing nearly 60 percent of its value in 2011.
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