2. Bank of America (BAC) is a diversified financial services company, with investment-, commercial- and retail-banking operations.
Left for dead during the financial crisis, its stock has more than tripled since the March 2009 market low. In recent quarters, ongoing mortgage woes and credit write-downs have hampered performance. Most recently, management's request to boost its dividend was denied by the Federal Reserve, indicating that Bank of America is still viewed as a troubled institution and needs to raise further capital and work through ongoing housing market issues on the liability side. The stock has tumbled 27% in 12 months.Recent news flow has been undeniably negative for Bank of America, providing an opportunity for value-oriented investors to initiate positions, in Credit Suisse's view. Credit Suisse expects the stock to advance 47% to $20. The consensus on Wall Street is that Bank of America's equity is undervalued. It currently sells for 7.6-times forward earnings, 0.6-times book value, 1-times sales and just 1.7-times cash flow, representing discounts of 32%, 37%, 42% and 69%, respectively. Currently, 54% of researchers in coverage advise purchasing shares and the remainder recommend holding them. Bank of America is scheduled to report fourth quarter results April 15.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV