Berkowitz Comments on BofA's (BAC) Value - "It Doesn't Get Better"
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Bruce Berkowitz of Fairholme Fund commented on bank stocks and specifically Bank of America (NYSE: BAC) in an interview posted Wednesday.
He said he is comfortable with his portfolio composition, including financials - an area he is very familiar with and has seen multiple cycles. He said we are currently finishing up the down cycle and beginning an up cycle.
Commenting on Bank of America, he notes it has book value of $20, tangible book value of $12-$13 per share, and earnings power of $4 per share. "It doesn't get any better" when it comes to value investing, Berkowitz said.
Commenting on the ongoing litigation between Bank of America and MBIA (NYSE: MBI), another portfolio company, he notes the company has already reserved for, or almost all reserved for, the settlement. Bank of America has such significant cash flow, it will not be a big deal. However, it will be a big win for MBIA. He said both stocks should go up on a deal as Wall Street hates uncertainty, and this will remove it.
He said he is comfortable with his portfolio composition, including financials - an area he is very familiar with and has seen multiple cycles. He said we are currently finishing up the down cycle and beginning an up cycle.
Commenting on Bank of America, he notes it has book value of $20, tangible book value of $12-$13 per share, and earnings power of $4 per share. "It doesn't get any better" when it comes to value investing, Berkowitz said.
Commenting on the ongoing litigation between Bank of America and MBIA (NYSE: MBI), another portfolio company, he notes the company has already reserved for, or almost all reserved for, the settlement. Bank of America has such significant cash flow, it will not be a big deal. However, it will be a big win for MBIA. He said both stocks should go up on a deal as Wall Street hates uncertainty, and this will remove it.
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