This Day On The Street
Continue to site
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

Now Is the Time to Buy Bank of America, Ahead of Earnings

I'm not discounting that Bank of America still faces plenty of legacy operational issues. But it seems that despite the ample signs of progress, management still isn't getting any credit. The Street also ignored management's shedding some of the bank's low-performing assets and loans as it strives to improve its ability to return value to shareholders.

This is while the bank is in the midst of a significant restructuring plan that includes a 10% headcount reduction, extinguishing debt and so on. The bank also continues to bolster its balance sheet as its Basel 3 Tier 1 common capital ratio continues to improve.

Basel 3 is a global regulatory standard that serves to prevent too-big-to-fail scenarios by enforcing not only bank capital requirements, but also by adding minimum standards on liquidity and leverage. Basel 3 requires banks to hold 4.5% of common equity. This is an area in which CEO Brian Moynihan has taken a personal interest in an effort to help build back trust in the bank.

In that regard, there are signs that the bank is starting to regain both investor and consumer confidence after a long-fought battle toward recovery. There's still plenty of work to be done, but with mortgage originations on the rise as the housing recovery continues, it's safe to say that the worst for Bank of America is over. I would be a buyer here ahead of earnings.

At the time of publication, the author held no position in any stock mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Richard Saintvilus is a private investor with an information technology and engineering background and the founder and producer of the investor Web site Saint's Sense. He has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr 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

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
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!
SYM TRADE IT LAST %CHG
BAC $15.54 -0.13%
JPM $62.34 0.00%
WFC $54.97 0.00%
AAPL $135.45 2.10%
FB $81.91 0.00%

Markets

DOW 18,037.97 -42.17 -0.23%
S&P 500 2,108.92 -8.77 -0.41%
NASDAQ 5,060.2460 -31.8390 -0.63%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs