Regardless, Palmer continues to recommend MBIA shares, which lost 2.09% Thursday to close at $8.45.
"We believe any weakness in MBIA shares today driven by
Bank of America
's decision to continue with its cash tender offer is unwarranted," he wrote, adding the shares' current price fails to reflect "the significant benefit that MBIA gained" through the successful amendment of its bonds "or the mounting leverage that the bond insurer has amassed as the litigation moves toward the point that it could cause real pain" to Bank of America.
An MBIA spokesman declined to comment, while Bank of America spokesmen did not respond to email messages.
Written by Dan Freed in New York.