Bank of America reported first-quarter net income of $653 million, or three cents a share, however, the results included "negative valuation adjustments of $4.8 billion pretax, or $0.28 per share, from the narrowing of the company's credit spreads." CFO Bruce Thompson pointed out that "the narrowing of our credit spreads reflects the significant progress we've made to strengthen the balance sheet," and said that the negative adjustment to earnings "should not overshadow the positive momentum that we are seeing in our businesses." Mosby rates Bank of America a Buy, and said on April 19 after the company announced its first-quarter results that excluding the debit valuation adjustment and an estimated "$2 billion in significant items included in this quarter's earnings," brought "BAC's operating EPS down to $0.15, 3 cents favorable to our estimate of operating earnings per share of $0.12." The analyst said that "until short-term rates begin to rise, BAC's earnings power is between $10 billion and $12.5 billion a year." Bank of America's shares closed at $8.25 Friday, returning 49% year-to-date, following a 58% decline during 2011. The shares trade for just 0.6 times their reported March 31 tangible book value of $12.87, and for eight times the consensus 2013 EPS estimate of $1.05. The consensus 2012 EPS estimate is 61 cents. Mosby rates Bank of America a "Buy," with an $11 price target, and said that "current discount to tangible book value per share represents the potential upside once the market decides that BAC can cover future losses from Countrywide's residential real estate overhang issues with future earnings." Guggenheim Securities has "calculated a range for potential remaining after-tax losses of $15-40 billion." Interested in more on Bank of America? See TheStreet Ratings' report card for this stock.