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Ray Merola  

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  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    I like your style, Phr3d

    "Tactful understatement," indeed.

    Perhaps I've become a sort of half-baked statesman in my latter years........
    Apr 23, 2015. 02:46 PM | 1 Like Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    A reader who follows the brokerage community closer than I may have to help on that one.
    Apr 23, 2015. 02:44 PM | Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Thank you, nasa_rs

    My price target for BAC is $21. I wrote a S.A. article about the bank earlier this year and outlined that thinking. My problem is Bank of America isn't very transparent about details, nor setting concrete financial targets.

    I'm willing to give management about a year to see if they can pull things together.

    On the other hand, Wells Fargo is a *very* core position for me.
    Apr 23, 2015. 01:31 PM | 1 Like Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    You are welcome, sheldond

    There are some good community banks out there that I want to review.

    Agree that Wells Fargo is at approximate fair value. There's MSD earnings growth and a solid dividend, but I would not be excited about adding to my position at these levels, either. I've had a good run with WFC.
    Apr 23, 2015. 01:29 PM | 1 Like Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Thank you for some very kind remarks, CapeCapMgmt.

    We fully agree Wells is the best large bank on Main Street. There's a couple of smaller ones out there that deserve a look, too!
    Apr 23, 2015. 01:26 PM | 1 Like Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    buckallred

    I might accumulate on any garden-variety general market pullback. Ideally, the "sweet spot" is about a 5% to 8% off the near-term high. That's ~$52. Of course, I cannot recommend specifically you buy Wells Fargo.

    Another avenue to check are Wells Fargo warrants. Some can be attractively priced, since bid/ask can be thin, offering temporary discounts. There are a few flavors out there. Be sure to check the details closely.

    Finally, with a solid blue-chip like WFC, I like to scale in (or out) slowly. Buying in one-quarter increments has worked pretty well for me. I never jump in or out at once. Sometimes Mr. Market provides a gift.
    Apr 23, 2015. 01:24 PM | 3 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    We are thinking alike, Ernie Mac

    However, since Moynihan got himself named both CEO and Chairman, I suspect he's not going anywhere right away.
    Apr 23, 2015. 01:15 PM | 3 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Interesting comments, IP

    As WS analysts begin to weigh-in, I will be following closely to see how many pick up on your RWA analysis perspective. It would seem these guys should be able to discern what's going on at some level. Likewise, I suspect Buffett will have some insight. He's worth watching/listening, too.

    Fully agree that when one cannot understand the business/financials, it's time to get out. This is what drove me away from Citibank in 2010-11. Just too much mumbo-jumbo.

    On the other hand, notice how there's so few comments on Wells Fargo? That enterprise just goes out and creates shareholder value.
    Apr 23, 2015. 12:53 PM | 2 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    auto44

    Understand the skepticism. However, I believe BAC does understand its numbers; and that's what worries me most. Lack of transparency. See Investor Psyche's comment below.
    Apr 23, 2015. 12:48 PM | 2 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    plumchair2

    We agree that BAC is a bit speculative. If management can avoid tripping on themselves, there may be a pony in there somewhere.
    Apr 23, 2015. 12:17 PM | Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Thank you Robert,

    You've made several good points.

    Some speak to my view that a healthy economy MUST have bank participation. While it's not perfect, the American economy is one of the best games in town (or globally, for that matter).

    In a post TBTF and Dodd-Frank world, I wonder where the banks will shake out in the long run. Experience tells me smart guys go into finance, and the smart guys always figure out a way to juice the system; until the next crash. Then the regulators try to close the barn door after the horse it out.

    Let's see how this cycle plays out.
    Apr 23, 2015. 12:15 PM | 2 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    bsorge

    I was not aware of that. Interesting.

    However, I don't generally put too much faith in broker Buy/Sell recommendations......
    Apr 23, 2015. 12:10 PM | 5 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    jblau

    The trick is to pick the one that does best. This is where the challenge lies.

    For the long haul, I've cast my lot on Wells Fargo. It's a core position. I envision Bank of America as more speculative, holding greater risk and (potential) reward.
    Apr 23, 2015. 12:09 PM | 2 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Thank you, mag1205

    My problems with BAC management are a combination of things. Moynihan is an attorney by trade. My view is he answers Street analyst questions like a lawyer, not a banker. Now that the major litigation is (purportedly) in the rear-view mirror, a change to a more financial-oriented CEO could be helpful.

    In these cases, I like having Warren Buffett as a co-shareholder.
    Apr 23, 2015. 12:07 PM | 4 Likes Like |Link to Comment
  • A Tale Of 2 Banks: Pondering Wells Fargo And Bank Of America [View article]
    Globally, the American economy is one of the few doing well now. I like the fact that Washington is grid-locked for now and Obama is winding up his last term; no news is good news.
    Apr 23, 2015. 12:04 PM | 2 Likes Like |Link to Comment
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