One of the country’s largest banks by assets and branches, Bank of America also provides credit cards, asset management, and other money-related services.
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Well, I am gonna be the contrarian here...just came on to post that I initiated a position in the stock. (and see many are red thumbing it). I know most will think I'm crazy but... Will add if it goes lower. BAC is not gonna just go away. We already know the gov't won't let it fail....They are rightsizing the ship. May take another six months or so...but the market looks ahead. Tangible book is in the 13.25 area and book is 20.99. Eps for 2013 is around an average of 2.4. It normally trades at a 8.5 to 12 pe. This stock seems to be finding it's "bottom" in the 11-12 area. Obviously many disagree but, that's what makes a market. Merrill is going to add heavily to the bottom line...and purging the countrywide failure is going to be big. Already settled many issues and will work thru the rest this summer. I'll be looking to add thru August, unless the stock reverses during the summer. My valuation of a combo of tangible book and forward eps...gives me a slightly discounted value of around $25 per share in 2012/2013. Regulatory issues will slowly fad as election nears as well. I was looking for a %50 percent discount to that...which would be 12.50. Happy to have waited to buy this am and get it well under that.
Naw bro Bank of Countrywide Lynch is rightsizing via fraud and it will last as long as we have complicit politicians feeding the beast. Cough NJ. CTFC. SEC. 1913, Gramm-Bliley, 6 months? Yeah 6 months till the majority of the shadow market foreclosures finally hit the already further deflating realestate market. The majority of the "assets" held by this INSOLVENT institution are losing value. There is no recovery and there will be an inflated BAC so long as QE3OT2 hits at JH, WY, get RP in office and you will see your thumb turn red with new and legalized competition for the Fed dolla, which is the only thing keeping this corpse walking. I would trade it short term from the depths of July into Nov then sell the pig and take a showr...
Why hold an institution which is one of the big 4 holders of OTC derivatives with a nominal exposure over 100Trillion. The "assets" are deflating realestate at 40:1 to their liabliltie not including repo 105 SIV. Own a wholly complicit
Just added another lot of shares at 9.95... going to hopefully get the chance to add early next week. Nice deal going on right now with this company. News is horrible and nobody likes it. Yet, it's the best banking franchise in the US...ok, the ladies will say JPM due to their crush on Dimon...but, let's get real here. BAC is a steal under ten. That's my call. and I'm putting my money where my mouth is.... buying...and will continue to buy thru summer like I said originally.
Just bought some more today at 6.5. Either gonna make money on this or it's the biggest pork chop I ever ate!! I just can't reason for this to be so low. These lawsuits are not going after BofA practices...but they are going after BofA after buying troubled assets. If they "helped the system"...then why is the gov't also going after them again for buying up junk to help "it's country." I still say BofA comes back when Obama and his biz killing practices leave office. I'll wait cause it's a 20 dollar stock then. Buying when there's panic in the street.
You can't reason why the reprice? Let's see, outstanding litigation and loan imminent loan write-downs account for all Tier 1 capital, the other "assets" are *still* grossly overvalued and are headed LOWER. I maintain my sell on BAC until QE3(which could be as soon as 2 weeks away), at which time, BAC will then be a buy.
I'm contrarian as well. I usually don't do this but sometimes, I smell a bargain.
"Shares of BAC now trade at less than half of their second quarter Book Value and at a price-to-cash flow ratio (trailing twelve months) of about 0.7x, which is about half of its five-year average." The stock has taken a 40% hit in a month. It isn't over yet. Bush was in bed with JPM, not BOA. They set them up to take the fall for everything. They are totally insolvent and are functioning as a clearing house for all the bad credit not only in housing, but in foreign markets too. What will happen is that this company will eventually sell off the Merrill piece, probably to Goldman, they will then sell off the banking piece, probably to JPM, and after the next round of 2.4 million forclosures gets released next year, Wells Fargo will pick up those pieces for .20/1.00.
All that said, I see the stock going down to $4.50 - $5.50 just because it is the street's favorite whipping boy right now. Financials in general will have a huge bounce in 2012, and you'll see this stock go up. It may return to the $12-$15 level. That would be a 2/3 bagger, but don't be fooled by the bounce. It will blow up again by the election, especially if it looks like Obama will lose by a significant margin. Should that be in the air, don't be surprised to see Moodys and other rating agencies, downgrade the US debt. Vindication for S&P, CYA for the others. It's a win win for everyone, but it will cause an initial panic sell-off of financials.
Foolish bottom line is that if BAC hits anything south of $6, I'd by it, but only to play the bounce. I have a limit order in at $5.25. After that, I'll review it at $8, and put a sell order in at $10. I find the best investing sometimes is to just set things up to happen automatically. Do I lose out on the peaks, yes, but there is security in having a plan and working the plan. Greed does not make you rich, it more often leaves your pockets empty, and I'm perfectly happy with a 90% return.
I like your thinking. I was going to buy at $6 but maybe you $5.25 makes more sense. I wanted to sell my existing at $14 but resisted. Now I need a new plan to cover my losses. Thanks
This is a company that brings out some powerful emotions in people. Similar to Apple, but in an opposite way. Anyways, people seem to forget that Bank of America is a business. It must be run profitably for it to be successful. They cry about fees, etc. Long story short, this company will be profitable, and at these prices, it's definitely worth the risk IMO. The original post hit it on the nose. Even if it trades at a discount forever, it cannot stay at these levels.
I agree...just bought more today.