In a letter to clients, Paulson & Co, which is run by billionaire John Paulson, predicted that Bank of America shares may rise to almost $30 by December 2011.
The share price currently stands at $15.77 on the New York Stock Exchange, reports Bloomberg.
In February this year, Bank of America shares stood at $2.53 but investment by John Paulson's hedge fund has helped the turnaround.
The letter told investors that Paulson & Co believes they have yet to reach their peak.
"[While the bank] has risen from when we purchased the stock, we believe considerable upside remains," it said.
Paulson & Co is a respected name in the financial sector and had its reputation improved last year after it made an estimated $2.5 billion by betting against the US housing market.
Last month, Bank of America reported a net loss of $1 billion for the third quarter of 2009, partly due to paying $402 million to terminate an asset guarantee term sheet with the government.
By Gary Cooper