John Paulson Thinks Bank of America (BAC) Shares Will Double

In a letter to clients of his Paulson & Co. hedge fund, investing guru John Paulson said he thinks shares of Bank of America (NYSE: BAC) can double in the next two years.

In the letter obtained by Bloomberg news, Paulson said shares of Bank of America could rise to $29.81 by December 2011 as writedowns ease. "Banks will have passed the current writedown cycle and have visibility for growth in 2012," the letter said.

Paulson's latest quarterly filing showed he owned 159,794,229 common shares of Bank of America, down from 167,990,464 shares. He said while the fund is up on its investment in Bank of America "considerable upside remains."

Among other banks stocks, in the quarter ended September 30, Paulson also accumulated 300,000,000 million shares of Citigroup (NYSE: C), lowered his stake in JPMorgan Chase (NYSE: JPM) and liquidated his stake in Goldman Sachs (NYSE: GS).

Paulson gained notable fame over the past few years after making billions for himself and his firm betting against the US housing market.

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