Bank of America Corp (BAC)

Undervalued. Paying back tarp. Will benefit from continued economic recovery in 2010. Dont be foolish..........

2010 will see BoA earnings rise.

Coming out of TARP. Leveraging synergies of ML, on the banking customers.

Will benefit strongly from the starting recovery.

Currently undervalued.

Bank of America has been conservative in reserving for potential losses and has tremendous earning power after the economy turns around.

Survivor gets more market share. Cheap government money. Friends in very high places. Commercial real estate problems are already baked in. Very green and very long.

First, I don't like Bank of America. I have a checking account, savings account, mortgage, credit card with B of A. Although I've never been charged any service or late fee, I've found that B of A's website does not give as much useful information as it did a few months ago, and although they made a lot off of me when I refinanced my mortgage with B of A recently, they lowered my credit limit on my B of A credit card. The lower amount has no practical effect upon me, but it makes no sense to me. Furthermore, B of A's acquisition of Merrill means that if I were to move my IRA account over to BoA, Merrill would be handling it.

My experience with Merrill in the past was not good. They didn't seem to want anyone but "high worth individuals" so they started charging me high fees when I started withdrawing money for my kids' college. Now that i'm a millionaire, I wouldn't trust Merrill with any part of it.

But why do I think B of A will outperform?
1. Because of the reforms and changes the firm has had to make will eventually put them on a more solid footing.
2. On a relative safety basis, major American banks will begin to look better than many overseas banks.
3. If this too-big-to-fail bank is broken up, the sum of its parts will probably be larger than its current value.
4. It's harder for people like me to switch away from B of A. We live in a time when so many of our accounts are paid automatically from our bank, it would be a damn nuisance and a huge waste of time to change from B of A to another bank. It's not as simple as it was just a few years ago when the hardest part about changing banks was to decide what design we wanted on our new checks.
5. Because it is more inconvenient to switch from one bank to another, banks like B of A will be able to get away with paying little or no interest on deposit accounts (which in turn means that they can maintain the current very profitable difference between the rates they pay depositors and the rates they receive from borrowers.)
5. In spite of all the enemies big banks have made, they still have great influence in making laws that favor themselves.

Get in ahead of this...gotta roll the dice on some financial - might as well be this one.

This met a high level screen to indicate a buy and strong outperform against its peers (other tickers in its industry). My 1st version of this spreadsheet devles deep into the company's balnace sheet and recent income statements, combined with other relevant price data for the company including insider/institutional holdings, short interest, debt levels, etc.
Testing capabilities of this 1st version of my automated, valuation spreadhseet matched with my personal criteria and see how it holds up.

Priced at half of book value. Even if all of their mortgages fail simultaneously, they should be able to recover at least 50% of the principal by selling the houses off. Therefore, how can the stock go down any further?

recession is over? are you sure? I don't think so...

haha... u all should sell this stock coz its going down.

yo

BAC will make a comeback and be profitable.

ML will produce major profits for this company.

I still refuse to value BAC at a much higher level, I already made several hundred shorting this stock and although I've closed that position for risk-management I'm still bearish.

This bank is going to emerge huge in the next couple of years. They will be calling this the Phoenix.

Underperform

Like Cramer on MSNBC said you hold your nose and buy this stock and make money. Period. I bought in when the stock was slightly below $7 per share. Have increased my position in quarters two fold since n i'm now DCA at just over $12 a share n still making a ROI of over 20%. $20/30 per share next fiscal year not out of the question.