Based on linear regression, if the Fed is correct in believing 3.00% stands as the current neutral overnight rate long-term this would give BAC a long-term ROE of approximately 10.2%. I assume that its 5.7%-6.0% ROE figure holds over the next few years. I have its 2016 net income projected at $15.2 billion ($1.45 in earnings per share) and book value of equity at $262.8 billion. I have the company’s payout ratio at approximately 36% in the near-term, before increasing linearly to 50% by 2026. I also have its cost of equity at 15.6% over the next five years before linearly falling to 10.65% from 2021-2026 to account for less volatility in the banking sector.This provides a projected intrinsic price of $13.59 per share. Including error sensitivity with respect to the projected ROE (+/- 100 basis points), this would provide a valuation range between $12.16-$15.05. This implies that BAC may be undervalued at this point by 4%-5% at the median, but is fully within its far valuation range. I would like to see BAC fall below $11 before I would consider it a compelling opportunity.--Bank of America's (BAC) Return on Equity Issues Bank of America (BAC) Valuation Based on Various ROE LevelsBank of America (BAC) Price Projection Based on ROE NormalizationValuation of Bank of America (BAC) (Current)