RonB

The Next Step in the Bank Implosion Cycle

Warren Buffett is one of the best evaluators of risk in the world. He has a huge investment in Wells Fargo, which he recently increased. I don't see the name of the author, or of any of the people who are forecasting gloom and doom, on any top perfoming investor lists. Bottom line: if people are stupid enough to keep selling Wells stock on these broad based "analyses", buy it. You are getting another great opportunity.

Wells Fargo: An Example of Why I'm Bearish on Banks

Myopic thinking. Wells has the best net interest margin of all the large banks, an enormous deposit base, and superior loan quality. Picking at hedging, MSR's and the like may sound clever but it misses the point. Wells basic banking business is solid and extremely well managed. The credit crisis is gradually improving, and the writeoffs will abate over the next several quarters. There may well be some near-term volatility in the share price because of misguided thinking, but Wells remains an extremely attractive long-term investment, with earnings power above $4 per share. When we look back in five years, we will see that this wa a great opportunity. As for Bove, he is trying to do everythiong he can to justify his $25 price target. Remember that he advised shorting Wells Fargo in 1992, not long before it had an enormous runup when that era's banking crisis improved. Billionaire investors like Warren Buffett and Prem Watsa are substantial Wells investors. I'd much prefer to pay attention to them than to analysts seeking headlines.

Ron Beasley
Investment Advisor
rwbi.net

Get Ready to Short the Banks

Ahh, another article desparately written by someone who missed the rally and wants a lower entry point. Full of broad-brush generatlities. Specifics matter here. Wells Fargo is a good example. Wells has pre-tax pre-provision earnings power well above $40 billion. It will do $40 billion this year. In a more normal environment, after the current spate of writeoffs has subsided, provisions will be under $10 billion. A $10 billion provision level would result in after-tax income of around $4.20 to $4.30 a share. At a historically low PE multiple of 12, you have a $50 stock price. Wells is now trading at $30. Which is why it is the largest holding in my personal and client portfolios, and it is why Warren Buffett and Prem Watsa own so much of it.

Ron Beasley
Investment Advisor
rwbi.net

Wells Fargo's Commercial Book: Implosion Alert?

The volume of this sort of moronic commentary on Wells Fargo is truly remarkable. Some are trying to influence the stock price, others simply do not understand the bank, but in either case, do not be influenced. Prem Watsa and Warrn Buffett are two billionaire investors who are very impressed with Wells Fargo. I think that is a much better source of evaluation than this type of rhetoric.

Disparity in Bank Asset Valuations

It would be nice if people who wrote these articles understood bank accounting. This individual does not.

Enough with the Buffett Critics

Excellent article. Buffett's wisdom and success provide great lessons for all investors.

Ron Beasley
rwbi.net

Wells' 'Under the Radar' Subprime Loans

Many of the loans Wells Fargo is selling have most likely been charged off in connection with the Wachovia acquisition. Also, the vast majority of Wells' subprime loans are debt consolidation loans, not the questionable stand alone mortgages to high risk borrowers that are held by most other banks. Their subprime is performing better than than their competitiors. The author is of this piece is generalizing, as so many do, when the intelligent thing is to look at each individual bank's loan portfolio. Wells has superior asset quality.

Wells Fargo is the largest holding in my personal and client portfolios.

Ron Beasley
Investment Advisor
rwbi.net

Banks: Rebuilding the House of Cards

One only needs to look at Wells Fargo's net interest margin, the doubling of its deposit base from the Wachovia acquisition, the writeoffs it has already taken, and the growth in new business to see the benefits that will be recognized over the next few years.

Don't let silly articles like this distract you from fundamental value. There is nothing wrong with Wells' accounting. The writer seems to think that only declines in market value should be booked, but not their reversals.

Wells Fargo is the largest holding in my personal and client portfolios.

Ron Beasley
rwbi.net

The Next Wave of Foreclosures

Re. Wells Fargo, yeah, let's listen to Dirk whoever and ignore Warren Buffett. Yeah, there's a good idea.

7 Reasons Not to Buy Berkshire Hathaway

Let's pay attention to Hao Jin and not Warren Buffett. Yeah. That makes sense.

7 Reasons Not to Buy Berkshire Hathaway

The last time people like this author came out in force and said to avoid Berkshire was in 2001, at the height of the Internet bubble. At the time, people said Buffett had lost it, was outmoded, etc. Berkshire's stock had dropped nearly 50% in the previous nine months. It as a tremendous bargain, and nearly tripled over the next seven years.

Buffett's portfolio is solid and undervalued, his insurance business should soon be recovering from cyclical lows, Geico is doing very well, and his deriviatives investments are very misunderstood. The stock is very attractively priced and offers low risk in a high risk environment. Berkshire is a substantial holding in my personal and client portfolios. Note also that Mason Hawkins took a large position last quarter.

Wells Fargo Is Broke: Poor Forecasting Slays Another Giant

It is sad...no, pathetic, that people like this make up such falsehoods. No one could possible believe all this, so we must write it off to the bleatings of a desparate short-seller who will do anything he can to influence the share price negatively. including spreading lies and false rumors.

Curious Accounting Tactics at Wells Fargo

The two comments above are on point. People have become so paranoid and suspicious about bank earnings that even highly ethical companies like Wells come under attack. Fortunately, the comments in this article have virtually no basis, the writer does not understand Wells operations or the imact of the Wachovia acquisition. Wells earnings power is substantial, its deposit base has doubled, its cost of funds is the lowest of all major banks, its credit quality among the highest.

Wells Fargo is presently the largest holding in my personal and client accounts.

Ron Beasley
rwbi.net

A Bull Market That Few Are Buying

It is remarkable to watch so many people come out with harsh criticsm, and to recognize that these people have no constructive ideas, and no responsibilities. And of course, they do it after the economy is showing signs of stability. Where were all these self-acclaimed brilliant people before things fell apart?

Now Is the Time to Consider Buying Level 3 Communications

Level 3 now has positive cash flow (annually, not in Q1), improving margins, its industry is growing rapidly, partiularly in content delivery and video, two outstanding investors have added substantially to their holdings, it is run by very competent management, and is the low cost provider. All this for $1 a share. The upside is substantial. I own Level 3 shares.