FIG trader_

The Long Case for Ameriprise Financial

Seems like fairly well reasoned investment case, though I would quibble with a few things. First, the stock has done well since being spun off bottoming in the low thirties in late 2005 (to $54 currently). That suggests the market does recognize the "value". In fact, it has outperformed significantly AXP, which I think is still 'rich". If there is any skepticism, it may be over investors' keen memory of having been burned badly in the Nineties by substantial junk bond losses by prior management, and poor "handling" of the disclosure. It is a crowded field though, and I think the premium valuations for asset managers/gatherers will be hard to expand. Prices/book relative to forward looking ROE's are probably near peaks rather than troughs, unless one assumes the bull market in equities to proceed unimpeded through decades end I give it less than 50/50. Its been a pretty good three year run from the lows, and this bull phase seems long in the tooth. One question I would ask is why did AMP give up the AXP brand; could they not agree on fee structure; seems like years of wasted invested by AXP??