According to Societe Generale, investors should consider buying Bank of America even if the risk of a recession remains. Analyst Andrew Lim upgraded Bank of America to buy from hold, saying in a note on Monday that the “quality bank” looks cheap after falling 36% from recent highs. “In our view, Bank of America (BoA) is the best quality universal bank in the US. It has the most defensive credit portfolio and high sensitivity to rate hikes, resulting in a higher P/TE estimate through 2022. That premium has disappeared as recessionary concerns have grown,” Lim wrote. “We now trade at 23eP/TE at just 1.31x for a 23e ROTE of 14% on our numbers, and we believe that owning BoA has become a much more compelling proposition.” — added Lim. Societe Generale cut its 12-month price target to $37.50 from $40.50. The new price target represents about 18% upside from Friday’s closing price for the bank. The analyst also lowered its 2022 EPS estimate by 14%. fiscal year to account for potential loan losses. The firm believes stocks are already priced into recessions, which typically hurt cyclical stocks like banks. Banks are vulnerable to downturns as fewer consumers buy homes or cars and more people have problems paying off loans “Owning a bank at the start of a recession is historically not a good idea, even if it’s ‘cheap.'” As detailed in our industry report today, our main argument is that the market is already determining yen in a severe recession and that the Fed is close to suspending rate hikes,” Lim wrote. “We believe that for BoA (and other commercial banks) this means a more positive forward earnings estimate based on benign credit quality and continued positive loan growth,” he added. — CNBC’s Michael Bloom contributed to this report.