District Banker

Wells Fargo: Please Dilute Shareholders and Repay TARP Now!

oh - you're one of those EPS bank stock investors that has gotten mowed over in the last 2+ years.

don't worry about the balance sheet - those toxic assets won't come back to bite you!

Wells Fargo: Please Dilute Shareholders and Repay TARP Now!

What dilution are you talking about?! WFC is trading well above TBV, and thus any issuance would be ACCRETIVE to book value. Yes, today's shareholders would own a smaller percentage of Wells, but it would be a smaller piece of a larger pie.

Do you know what would be dilutive? REPURCHASING SHARES (contrary to your suggestion). This is basic finance, and you shouldn't be posting if you don't understand it.

Chart of the Day: The Big Banks Get Bigger

The FDIC is going to insure all those deposits under the specified limit whether they are scattered across 1,000 community banks, or all held at JPM.... so what's your point?

Wells Fargo, JPMorgan and Bank of America: Stock Prices Can Double

We will have to agree to disagree on this issue. But how can you have a serious discussion of bank stock valuations without a TBV figure?

What’s My Payment?

The name of the song is just "Beverly Hills." Get your Rivers Cuomo straight

M3 Funds: U.S. Banking Sector Remains Undercapitalized

At the time this idea was presented, FNB was at $9. Now it's at $7.

Thanks!


On May 08 06:07 PM sethmcs wrote:

> Funny I am up 45% on FNB and want it to go down to buy more. I feel
> the same thing about FNB that Warren Buffett feels about Wells Fargo.
> FNB is a good regional customer oriented bank. I will buy more between
> $6.50 and $7.00 for a long-term dividend investment. I am a very
> satisfied customer of this bank.

Five Midget Banks I'm Watching

I realize that you post a caveat saying, "I have not done enough work on these 5 names..." - but how could you post this article without a single piece of fundamental analysis??

The closest piece of relevant info you posted is P/Book - which no bank investors look at (we all look at P/Tangible Book). If you have to ask the difference, you shouldn't be investing in any financials, and certainly not banks.

On what basis would you say that FITB was the riskiest buy?

The Case for Shorting Bank of America

Yeah - real tough to remain nimble in BAC.

Please.... bandwagons abound on this thread.

The Case for Shorting Bank of America

Since when is the "smart money" decided by what the masses do? These are the same people that got toasted in 2007 and 2008.

As for your comment on Lewis, I agree that it could actually take some overhang off of the stock - but that's difficult to quantify/measure. Could go either way.

Bear markets never (EVER) go straight down, and banks are renegotiating CRE loans at a furious pace. You keep loading up... I need someone on the other end of my short sells!


On Aug 19 10:34 AM JosephN wrote:

> Actually, its because of BAC's exposure to california real estate
> that I believe it is a buy. Its one reason I think BAC, JPM, and
> WFC have all had nice runs. Exposure to california home real estate
> is now a positive rather than a negative in my opinion.
>
> I live in Orange County, CA. Probably one of the 'worst' areas of
> the housing bubble pop and I'm telling you it is over with here.
> People are buying or refinancing and the banks exposed to the market
> here will do very well on fees. I've even heard people are flipping
> foreclosures after only a few weeks from buying them at auction for
> 20-30% profits.
>
> If Lewis were to go I suspect there would be a pop up in price rather
> than a pop down. So I'm not worried there either. Commercial real
> estate so far has been a red herring for keeping people out of the
> financials while others (like me) loaded up, but so far so good.
> Only the closing of the car dealerships really has me worried on
> that front, as these dealerships often occupy large amounts of prime
> land in central locations.
>
> In any case, if you think 'insane to short BAC' is a little over
> the top that certainly is your opinion. Short interest in BAC looks
> to be around 1%, so maybe we could just agree that it looks like
> the smart money isn't taking the short side on BAC here.
>
> On Aug 19 10:10 AM District Banker wrote:

The Case for Shorting Bank of America

I don't know where to start with your post, Joseph.

I agree, on a TBV basis, BAC is not that expensive. (As an aside to the author - TBV multiples are how bank investors look at these animals today - NOT P/E multiples.) But let's think about WHY BAC might be trading at a discount.... could it be CFC and the exposure to CA real estate that it added to the balance sheet? Could it be the toxic waste dump that was MER? Could it be constant rumors of Lewis being pressured to resign? Could it be the other shoe that is looming: commercial real estate?

In any case, while I agree that when looking at a short, you MUST focus on fundamentals, (and WFC is many attributes of a potential short) - I reject your statement that "you'd be insane to short BAC."

That's just a little over the top.


On Aug 19 08:24 AM JosephN wrote:

> Shorting on technicals is like russian roulette. You have to look
> at the fundamentals.
>
> On fundamentals, BAC is still trading below tangible book value and
> being a huge multinational bank there are money managers that will
> have to buy this bank as the economy turns as they are required to
> match this or that index. Throw in the fact that housing has bottomed
> and the fees from refinancing mortgages for some real earnings power
> and you'd be insane to short BAC.
>
> WFC does look weaker though, trading above tangible book value and
> being USA centric with little overseas exposure. There is also a
> Buffett halo with WFC for what that might be worth. Maybe you could
> squeeze a small profit here on the short side.
>
> Really though, shorting banks was last year's trade. This year's
> trade is to buy and hold the financials tight.
>
> (long BAC)

Bank of America's Tangle with the SEC Is Quickly Settled

Tom -

We do not care. Please stop flooding SA posts with your personal issues.

Sincerely,
Everyone Else

How TARP Paybacks Expose Weakest Banks

I agree with the main contention of this article - but anyone who didn't already know that BAC and C were two of (if not #1 and #2) weakest banks in the country? If you need the government to tell you which banks are (relatively) strong, and which are at risk of failure, you shouldnt be investing in the sector.