This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Bank of America: Financial Winners & Losers

Stocks in this article: BAC

( Bank of America and other stock prices brought current in this update.)

BOSTON ( TheStreet) -- Bank of America (BAC - Get Report) was among the losers of the financial sector Monday after several investment firms offered cautious comments on the bank after it reported second-quarter results.

Bank of America shares sank 3.3% after Goldman Sachs removed the stock from its conviction buy list, saying it saw the least amount of credit improvement when compared to other U.S. banks that have reported quarterly financial results. The firm said it still retains a buy rating on Bank of America.

Bank of America

"We still believe that BAC offers investors compelling value, but given recent earnings results, coupled with ongoing uncertainty over regulatory reform, we do not see a catalyst to prompt near term performance" Goldman Sachs analysts wrote in a research note Monday.

Meanwhile, FBR Capital Markets cut its price target for Bank of America to $18 from $22, noting that the bank's estimate hit to debit fee revenue due to financial reform legislation was greater than many had expected.

"While an impact of this magnitude was worse than we would have guessed, we believe management was not extremely clear in highlighting that this impact is an absolute worst-case scenario and that the ultimate impact should be well better than BAC outlined," FBR analyst Paul Miller wrote in a research note Monday. He reiterated his outperform rating on the stock.

In addition, Rochdale Securities analyst Dick Bove cut his price target for Bank of America to $19.50 from $22.80, citing the expected impact of the new financial legislation on company results.

"The bank hosted a conference call, which was more negative than usual , to review the company's quarterly earnings, last Friday. The tone of the meeting and even the voice of Brian Moynihan, company CEO, was unusually stressed," Bove wrote in a research note Saturday.

Shares of Bank of America were down 46 cents, or 3.3%, to $13.52. The stock has dropped more than 10% over the last week.

On the other hand, Citigroup (C - Get Report) shares rose after Rochdale's Bove upped his 2010 and 2011 full-year earnings estimates for the bank, citing confidence in Citigroup's balance sheet. He notes that Citigroup now has $184 billion in cash on the balance sheet, which is 9.6% of assets.

"It may never report numbers that equal its true earnings capacity, but it is comforting to know that the bank's balance sheet is in a better state than it has been for a considerable period of time," Bove wrote in a research note Sunday.

Keefe, Bruyette & Woods analysts increased 2010 and 2011 full-year earnings estimates for Citigroup, saying that the "Citi story continues to progress with improving asset quality, run-off of Citi Holdings and momentum in its international business."

Citigroup shares were rising 3.1% to $4.02.

Additionally, Bove cut his price target on Goldman Sachs (GS - Get Report) to $170 from $182, one day before the bank is scheduled to report second-quarter results. Bove cited Goldman's $550 million settlement with the Securities and Exchange Commission and a continuation of the pressure on trading activity.

Shares of Goldman Sachs were tacking on 0.3% to $146.62.

Among U.S. bank stocks, Wells Fargo (WFC) slid 1% to $25.98. On the positive side, JPMorgan Chase (JPM) tacked on 0.1% to $39.02, and Morgan Stanley (MS) added 0.2% to $24.78.

Meanwhile, American International Group (AIG - Get Report) named Mark Tucker, former CEO of the U.K.'s Prudential PLC (PUK), to lead its Asian life insurance business. Tucker takes over as head of American International Assurance from Mark Wilson, who has led the company since 2009. AIG said in a statement Monday it would seek to list AIA on the Hong Kong stock exchange.

AIG shares were down 0.8% to $35.35.

-- Written by Robert Holmes in Boston.

Follow Robert Holmes on Twitter and become a fan of TheStreet.com on Facebook.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,672.60 -141.38 -0.79%
S&P 500 2,051.82 -11.33 -0.55%
NASDAQ 4,757.8790 +7.4820 0.16%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs