This Day On The Street
Continue to site right-arrow
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!

Banks Trail the Market: Financial Losers

Stocks in this article: BAC MS MET PBCT

NEW YORK ( TheStreet) -- Morgan Stanley (MS) was the loser among the largest U.S. banks after the markets reopened Tuesday after the holiday break, with shares sliding 3% to close at $15.29.

While the broad indexes saw slight increases for the session, the KBW Bank Index (I:BKX) pulled back 1% to close at 39.60, with 19 out of 24 index components seeing declines.

Economic news was mixed. The Conference Board said that its measure of consumer confidence for December was 64.5, exceeding a forecast of 58.3 among economists polled by Thomson Reuters and improving from 55.2 in November. Meanwhile, there was a report of a continued overall decline in U.S. housing prices, with the S&P/Case-Shiller 20-city index of national home prices falling to 1.2% in October, far exceeding the 0.4% decline expected by economists polled by Thomson Reuters.

Morgan Stanley has been one of the more volatile names among the big banks this year, and was included last week among TheStreet's 10 New York Bank Stocks With Most Upside for 2012. Based on a revised consensus price target of $22.36, analysts polled by FactSet see 42% upside for the shares in 2012.

Investors will see a messy fourth-quarter earnings report for the company, following Morgan Stanley's settlement with MBIA (MBI) over claims related to credit default swaps on commercial mortgage-backed securities, which will result in a $1.8 billion pre-tax charge.

Richard Staite of Atlantic Equities estimated that Morgan Stanley would post a 51-cent fourth-quarter loss.

Interested in more on Morgan Stanley? See TheStreet Ratings' report card for this stock.

Shares of Bank of America (BAC) declined over 2% to close at $5.48, after rising 8% last week.

The stock continues to be the most heavily discounted among the largest U.S. banks, with shares trading at just 0.4 times their Sept. 30 tangible book value of $13.20, according to SNL Financial.

Along with the regulatory onslaught being faced by all the major banks, investors are concerned about Bank of America's capital adequacy, as the company's Sept. 30 Tier 1 common equity ratio of 8.65% according to SNL, was the lowest among the "big four" U.S. banks.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!


DOW 17,879.77 +74.97 0.42%
S&P 500 2,070.13 -0.52 -0.03%
NASDAQ 4,763.8540 -1.5260 -0.03%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

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