Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (40683)	11/20/2012 5:27:13 PM
From: Keith Feral	Read Replies (2) \| Respond to of 218877

No, I think BAC probably is stronger than the rest of the banks in terms of near term upside over the next 6 to 12 months. FAS includes a lot of banks that have already gotten back to normalized valuations, whereas BAC has about a 40% discount to tangible book value. I think that will be the basis for a $14 BAC stock next year and probably $16 to $18 in 2 years. It's hard to put the legacy of loan losses behind, but the market won't care. They hate them til they love them, and BAC deserves the same market cap as WFC or JPM - give or take a couple billion. No one expected their capital levels to improve so dramatically this year, from 7% to 9% for Basel 3 Capital. They could be north of 9.5% this quarter, and earnings won't even matter again. I suspect they could come in around 10% when the stress tests are out next Spring. Plus, their debt levels will be closer to JPM by then. I see BAC trading at the same market cap as WFC within 12 to 18 months, which has $173 billion market cap with lower revenues than BAC today. Same with Citi. Those are my GLD and SLV positions.<g>