Investors should consider buying Bank of America even as recession risks linger, according to Societe Generale. Analyst Andrew Lim upgraded Bank of America to buy from hold, saying in a Monday note that the “quality bank” is looking cheap after falling 36% off its recent highs. “Bank of America (BoA) is the highest quality US universal bank in our view. It has the most defensive loan portfolio and high sensitivity to rising rates, which drove a premium P/TE valuation heading into 2022. That premium has dissipated with rising concerns about a recession,” Lim wrote. “Now trading at a 23eP/TE of only 1.31x for a 23e ROTE of 14% on our numbers, we think owning BoA has become a much more compelling proposition,” Lim added. Societe Generale did trim its 12-month price target to $37.50 from $40.50. The new price target represents roughly 18% upside from Friday’s closing price for the bank. The analyst also cut earnings per share estimates by 14% for fiscal year 2022 to account for potential credit losses. The firm believes that stocks have already priced in a recession, which typically hurts cyclical stocks such as banks. Banks are sensitive to downturns as fewer consumers buy homes or cars, and more people have trouble paying off their loans. “Owning a bank at the onset of a recession is historically not a good idea, even if it is ‘cheap’. As detailed in our sector report today, our main argument is that the market is already pricing in a tough recession and that the Fed is close to pausing rate hikes,” Lim wrote. “We think what that means for BoA (and other commercial banks) is a more positive appraisal of forward returns, based on benign credit quality and still positive loan growth,” he added. —CNBC’s Michael Bloom contributed to this report.