Bank Stocks Beaten Down on Bove's Bearish Note
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More News related to C
- Citi Appointed Depositary for 7 Days Group's NYSE-Listed ADR Program
- Willem Buiter to Join Citigroup (C) As Chief Economist
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- Bove Says US Banking System, Dollar to Benefit from Dubai Crisis
- Active equity option families in first 30 minutes of trading: C BAC GE AAPL
More News related to GS
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- Goldman Sachs (GS) December volatility low at 29, January at 34
- ING Sets Terms for Its EUR 7.5 Billion 6 for 7 Rights Issue
- Telegent Systems Files Registration Statement for Proposed Initial Public Offering
- Some Goldman Sachs Shareholders Want a Bigger Piece of the Pie
More News related to Analyst Comments
- Canaccord Adams Reiterates a 'Speculative Buy' on Delcath Systems (DCTH); Raises Estimates & PT
- Goldman Says We're Entering Final Third of U.S. Bank Losses; Says Stress Test Was Enough (XLF, BAC, JPM, COF)
- Piper Jaffray Maintains an 'Overweight' on Apple (AAPL); Comments on Black Friday Sales
- American International Group (AIG): AIG Reserves Deficient - Sanford Bernstein
- Citigroup Lifts Price Target on Human Genome Sciences (HGSI) to $38
Financial stocks are sliding today following (among other things) a bearish note by Rochdale Securities' popular banking analyst, Dick Bove.
Bove suggested investors lock in profits following the recent surge in financials since rebounding in early-March, saying that bank stocks are "trading on fumes". As Bove believes earnings will not improve in Q3, or even Q4, and that most banks will report losses, the analyst sees a near-term pullback in these stocks.
The Financial Select Sector SPDR (NYSE: XLF), a very heavily-traded ETF which attempts to mimic the movement of the broader financial sector, is down about 3.6% today.
Here's how several banks are performing today:
- Bank of America (NYSE: BAC) down 4% to $15.98
- JPMorgan (NYSE: JPM) down 3.7% to $41.13
- Citigroup (NYSE: C) down 7.2% to $3.66
- Wells Fargo (NYSE: WFC) down 5.2% to $27.14
- Goldman Sachs (NYSE: GS) up 0.2% to $160.76
- US Bancorp (NYSE: USB) down 4.4% to $22.00
- Morgan Stanley (NYSE: MS) down 2% to $30.19
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Banks vs GSE MREITS
I wouldn't own a big zombie, but I am happy with my recent TBNK purchase. That's about the only bank I would own, not because there are no other undervalued banks but because they can't compete with GSE MREITS like AGNC. Why? Because of FDIC premiums and special assessments. The FDIC fees only let banks keep about 80 cents on every dollar deposited. Efficiency ratios at the profitable banks that I am possibly interested in are all north of 60%, whereas at the MREITS efficency ratios are less than 20%. The low cost of funds via deposits, instead of repos, was the only advantage banks had over mreits, and the FDIC has taken that advantage away. Same NIM as banks but, lower efficiency ratios, no NPA's or NCO's, GSE MREITS win.
bove
bove said bac was the best buy ever when it was below 3 dollars. he says its now overvalued, i bought at 3 dollars on his say. i will scale out on his advice it is over priced its been a good run. thanks
Bank stocks
Bank stocks have been very crazy, You hear buy this and buy that. It seems to me that if you buy just about any bank stock that is trading under value and can afford to hold on to, It will eventually go back to normal trading value. Such as (RF) normally trades at around 20.00 but now it is trading under value@ 5.00 a share, If you buy and can afford to buy enough stocks like this and hold them long enough you could create a great nest egg for your kids.
the banks, markets, politicians etc.
This is not the country I grew up in. One scam after another. I am going to short banks and hopefully make a few dollars. If that does not work, I will pitch a tent. Whatever.
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Banks vs GSE MREITS
Taymere on Aug 12, 2009 03:22 AMI wouldn't own a big zombie, but I am happy with my recent TBNK purchase. That's about the only bank I would own, not because there are no other undervalued banks but because they can't compete with GSE MREITS like AGNC. Why? Because of FDIC premiums and special assessments. The FDIC fees only let banks keep about 80 cents on every dollar deposited. Efficiency ratios at the profitable banks that I am possibly interested in are all north of 60%, whereas at the MREITS efficency ratios are less than 20%. The low cost of funds via deposits, instead of repos, was the only advantage banks had over mreits, and the FDIC has taken that advantage away. Same NIM as banks but, lower efficiency ratios, no NPA's or NCO's, GSE MREITS win.