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Would You Buy Bank of America Common?

Ken Lewis did indeed say that he'd had enough fun with investment banking.

Having the government execute the original TARP plan and buy bad securities seems to be gaining more traction than having the government nationalize the banks. It would also be pretty hard for the government to nationalize all the big US banks. If the government doesn't nationalize, I don't see BoA being worth in the single digits.

That said, I don't have the stones to buy BoA.

What to Buy and Why: Barron's 2009 Roundtable, Part II

As for AMAT, semis are cyclical, but AMAT is probably the best among all the semi stocks. It has larger scale than its competitors as well as an emerging solar business. I think we're around the bottom of the cycle - this is the time to buy AMAT.

As to Abby's pick of BAC common, I have to say that BAC (which I bought around $48) is starting to look like a deep value play. Ken made a blunder with the Merrill acquisition. However, BAC is not as scattered as Citi. Merrill's brokers are a solid asset. The bank has a dominant and stable retail presence in the US. The terms of the last aid package were not onerous. BAC is also too big to nationalize. I would prefer that Ken Lewis step down in atonement for the Merrill fiasco, but I think the bank will survive. $7 a share is not reasonable, either.

Bank of America: Bank on This Opportunity

On paper this is a good deal. But there are too big hurdles.

One is BoA's capital position. Merrill may have purged itself of a lot of iffy securities, but they still have MBS and CDO exposure. Can BoA sustain further write downs without needing to raise capital with a depressed stock price? I'm guessing even odds of a capital raise going forward. Additionally, investment banking can be really profitable in good times and really unprofitable in bad times - as we're seeing now.

Two, I'm surprised no one's mentioned the integration risk. Investment banking is not retail banking. BoA has competency in the latter - that's their core business. They will have to integrate Merrill and their personnel while still digesting Countrywide. BoA's bitten off a big mouthful for sure.

Singapore's sovereign wealth fund apparently was averaging down into Merrill as it fell. Now it's going to end up with a bunch of BoA shares. Folks, those are my tax dollars in there. I personally own BoA. I really, really hope BoA knows what they're doing.

BofA's Lewis Is Still Making Deals, But Now Aiming for Distressed Assets

BoA doesn't have a lot of avenues for organic growth, so it's not surprising to me either that Ken would seek to acquire companies in this environment.

As a fellow shareholder, the question for me is, can BoA integrate Merrill while still digesting Countrywide? Can they stay well capitalized? And did they pay too much?

Merrill did purge a lot of dodgy assets last time, but they still have some mortgage and CDO exposure. BoA's capital position was a hair above well capitalized as of last quarter. Given their CFC acquisition, they really needed to rebuild their position. And now they've gone and bought a bunch of dodgy assets. Personally, I wouldn't object if they reduced or even suspended the dividend temporarily so that they won't have to raise capital while their stock is depressed.

Meanwhile, their stock is down over 10% today. I understand the MER deal is in stock. Let's hope that BoA's stock price will remain high enough that Merrill's shareholders will vote yes on the deal.

20 Top High-Dividend Growth Stocks

Re tanker stocks, I don't think they have the durable competitive advantages that many of the 20 listed stocks do.

Of the 20 that are listed, though, I don't think Fifth Third Bank is well positioned going forward. Wrigley is, but it's a) a little on the pricey side and b) is getting bought out. I like Bank of America a lot, but I'm not sure they're going to be able to consistently grow their dividend after buying Countrywide (although they seem to have contained the losses so far).

I would say that GE and Pfizer are my favorites on the list. GE will see loads of infrastructure demand from emerging economies. Pfizer's pipeline may be dry, but their boatload of cash and extensive sales network mean that they can partner with or buy any firm with an exciting drug on favorable terms.

Year to Date Performance of Dow 30 Members

Any votes for the stocks which have lost over 15% but don't deserve the punishment? I vote American Express and Pfizer. Pfizer's pipeline may look dry, but they have the financial clout to partner anyone with a hot drug, or to buy them outright. American Express' problems are overstated, I think.

Dow 'Dirty Dozen' Offers High Yields and Good Value

Re Nurseb911's comment, in addition to Pfizer and GE, I would also pick Bank of America among the high yielding stocks. In addition, I'd pick JP Morgan Chase. I believe both banks have reasonably strong balance sheets and are well positioned to pick up market share.

What Should We Make of Warren Buffett's Stake in Mega-Financials?

for the record, Capital One (COF) is no longer rated as wide moat. has it been dropped from WMW?

I do think Capital One is a buy at today's price, and I think it can widen its moat over time. actually, it was upgraded to wide moat not too long ago, and then downgraded after the credit crisis.

Seeking Stocks With Cheap, Safe Dividend Streams

PS, Rothmans trades on the Toronto stock exchange; the ticker ROC in the US is for Rockwood Holdings, which I think does specialty chemicals. I don't see a US ADR for the former.

for faster growing companies that pay decent dividends, I like:

Compass Minerals (CMP), which produces salt and sulphate of potash. They are the lowest cost US producer of the former, which gives them an advantage over everyone else, and we will always need salt. They also are a major producer of the latter, which is a specialty fertilizer for plants that may be damaged by potassium chloride. They've managed to consistently hike prices on the latter.

Enterprise General Partners (EPE), which is kind of a MLP closed end fund. it controls the general partner interest in Teppco, and has a stake in Energy Transfer Equity. both are good gas MLPs.

Realty Income (O) pays dividends monthly, and buys and leases retail properties. it's a more slow and steady pick, but it yields nearly 7% today and has been paying a rising dividend for nearly 40 years.

Johnson and Johnson (JNJ) doesn't have as hefty a payout as Pfizer, but this company has had double digit sales growth most of the time for decades. they're diversified between medical devices, pharma, and consumer medical goods, and can be expected to weather most economic downturns. I also expect their dividends to grow nicely.

Seeking Stocks With Cheap, Safe Dividend Streams

"Citi Bank said the US Bank Corp. USB is a failure and they don't recommend that you buy them?"

that's a bit like the pot calling the kettle black, isn't it? if anyone's dividends are in danger, it's Citi's. USB, on the other hand, is a conservative bank, and I have every expectation that they will be growing their dividends even in this market.

"On my orginal investment the dividend yields 18%."

I'm a young investor. companies that consistently grow dividends have a place in anyone's portfolio. when you reinvest the dividends, your future stream of dividends grows even further. your yield on cost rises. besides, companies that pay dividends and grow them constantly are probably growing themselves. USB, I admit, probably isn't growing that fast. however, Bank of America and Pfizer will grow. Pfizer's had a hard last few years, but their pipeline is strong.