UPDATE: Morgan Stanley Reiterates Overweight Rating, Lowers PT on Bank of America Corp. on In-Line 1Q Results

In a report published Thursday, Morgan Stanley analyst Betsy L. Graseck reiterated an Overweight rating on Bank of America Corp. BAC, but lowered the price target from $21.00 to $20.00. In the report, Morgan Stanley noted, “1Q's results were in-line on a core basis excluding transient items. Why lower fwd EPS? Most of the headline miss was on higher legal costs, so we're topping-up our legal reserve build estimate in anticipation of near-term settlements to largely resolve remaining legacy mortgage litigation. Despite the headline earnings loss, BAC improved its B3 standardized capital ratio by 20 bp q/q, narrowing the gap to 60 bp below with their B3 advanced ratio of 9.9% (BAC continues to provide best-in-class disclosure vs. peers on their reg cap ratios).” Bank of America Corp. closed on Wednesday at $16.13.