fcharlie

Nobody Knows What Bank Stocks Are Really Worth

I for one can say that i am not at all attempting to guess what earnings will be and slap a multiple on it to decide what these stocks are worth... there is no point...the reality is that many banks need only to survive and they are seriously undervalued, and the federal reserve is ensuring their survival with 0% interest rates as far as the eye can see.

Take Bank of America, if you net out the value of it's interest in China Construction Bank, it's selling for one times normalized earnings. You can argue all day long that it is technically insolvent, bankrupt, etc.. but the Federal Reserve is seeing to it that they are not going to fail.....deposits are growing, so they have no funding problem, and with $29 billion in loan loss allowances and $60+ billion pre tax pre provision earnings, all they have to do is continue to operate and eventually BofA will see the end of this. It may not be fair, but it's reality. The banks will survive, and once they have, it won't matter whether you bought them in feb. march, or april. you don't have to nitpick over what earnings will be next quarter or what multiple should apply to those earnings, because long term, the margin of safety is huge and the opportunity to make money is so great that you just have to buy them and either take some dramamine, or just tune out the noise....

Three Value Stocks

Goodfigs.

www.bbt.com/bbt/about/...

Three Value Stocks

BBT, as much as i like them, did not increase their dividend recently. unless you consider last June recent.

BB&T Corp.: Quarterly Dividend Up; Projected Payout Ratio Down

Do your homework next time. This is not a new increase. The 47 cent dividend rate was first declared in June, and has now been held steady for 3 quarters in a row.