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Dick Bove Said Goldman (GS) Stock Has Hit Bottom, Calls Citigroup (C) His Best Pick

July 12, 2010 5:22 PM EDT
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Popular bank analyst Dick Bove from Rochdale Securities talked financials on Fox Business Network today ahead of the highly anticipated earnings season.

Discussing Goldman Sachs (NYSE: GS), Bove said the "stock has hit the bottom," but "it's going to be a long haul to get the earnings back to where they were."

On JP Morgan (NYSE: JPM), Bove said, "Most people think earnings are going to be in the low 70’s, I think they are going to be in the mid 60’s. The key problems are the companies invested in banking business did poorly and I think there are going to be problems with their trading activity. Plus there has been no easing in the loan losses in residential real estate."

Commenting on his best pick right now, Bove said it is Citigorup (NYSE: C). Bove said, "The price is being held down by the government sales, but the company has turned around, the earnings power is there, the ability of this company to earn 70 cents at some point in the next 2-3 years is there which means I think it will get to eight and a half dollars a share. It’s not going to be next week but over the next 12-18 months you should expect to see it coming into that range."

Bove called Fin Reg a "misplaced bill" and he expects Regional banks earning to be better than people expected ad they are not going to add to their reserves in the quarter.

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