On Monday, we asked if Bank of America Corporation (BAC), whose shares rose almost 3% last week to an eight-year high, can sustain its latest rally. The shares – currently at around $23 – have gained more than 40% since the Nov. 8 presidential election.

It would seem that analysts at Wells Fargo Securities, which just named Bank of America its top pick in the industry for 2017, believe BofA shares still have more room to run. Wells Fargo, which also boosted the large-cap U.S. bank sector to Overweight, unveiled its prestigious buy list as earnings season is set to kick into gear with a host of financial powerhouses reporting later this week. (See also: Can Bank of America Sustain Its Latest Rally?)

Wells Fargo cited the potential for corporate tax reform and deregulation to boost earnings for financial firms, according to CNBC. "We see up to 26% EPS [earnings per share] upside potential for the banks in 2018," equity analyst Matthew Burnell wrote in a note to clients Monday. Burnell thinks bank stocks can reach new highs from a combination of higher interest rates, faster GDP growth and lower corporate taxes under President-elect Donald Trump.

Bank of America, headquartered in Charlotte, N.C., will report fourth quarter fiscal 2016 earnings results Friday. Wall Street expects EPS of 38 cents on revenue of $21 billion, translating to year-over-year growth of 40% and 7%, respectively. The extent to which the bank has driven higher profits via its cost-cutting efforts has been one of the major catalyst for the stock's performance. (See also: Trump's Bonus: Banks See Surging Profits.)

In that vein, with earnings per share projected to grow at almost six times the rate of revenue, CEO Brian Moynihan appears to have Bank of America on the right track. Beyond cost controls, Bank of America, which is your typical commercial bank, must also sustain its revenue growth. Its fixed-income trading revenue, which delivered $3.6 billion in profits in the third quarter, will be in focus.

The company has forecast a 15% rise in trading business in the fourth quarter. To the extent it can deliver on those expectations and issue a strong outlook for 2017, Bank of America stock should deliver on Wells Fargo's confidence. (See also: Lloyds Buys MBNA Credit Card Unit From BofA for $2.4B.)

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