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Bank of America Stock
Old 04-28-2008, 03:32 PM   #1
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Bank of America Stock

Im looking for one good buy and hold stock. BAC is now trading at 2004-2005 levels and is way off its high. 6% dividend. WB is also way off its highs sporting a 5% dividend.

Should I pull trigger?
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Old 04-28-2008, 05:43 PM   #2
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I have about 300 shares of BAC that I acquired when other banks, whose stock I owned, were bought by or merged with BAC. My average cost is around $20 per share so the current price of $38 would still raise my average cost basis if I bought more now.

Despite the credit crunch and big write-offs, I don't think the dividend is in any danger, in the near term so I will hold onto the shares I have. As a dividend play, buying BAC now would probably work out well. I recommend you dollar cost average in if you decide to invest.

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Old 04-28-2008, 10:27 PM   #3
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I bought some call options on Citi and National City for 2010. I am bullish on the financial stocks....Just my opinion.
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Old 04-29-2008, 08:18 AM   #4
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Should I pull trigger?
Pull the trigger Mr Chang! Sorry, I couldn't resist that. I love that E-Trade commercial.

Seriously though, I am staying away from the financial stocks.
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Old 04-29-2008, 10:55 AM   #5
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C has already reversed upward. For whatever reason, it looks like the better buy right now. That would be my bank pick, although I'd appreciate greatly if you'd load up on HBAN to get their share price back up.
JMO
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Old 04-29-2008, 03:30 PM   #6
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I think I would rather own a bank that didn't own Countrywide. I would much prefer to own a bank that avoided making many bad loans in the first place, like US Bank or Wells Fargo.

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Im looking for one good buy and hold stock. BAC is now trading at 2004-2005 levels and is way off its high. 6% dividend. WB is also way off its highs sporting a 5% dividend.

Should I pull trigger?
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Old 04-29-2008, 04:08 PM   #7
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Well I am glutton for punishment cause I own, and/or have written puts on a bunch of banks including BAC, Wells Fargo, and US Bank, plus Countrywide.

Still if I was going to pick a single conservative bank, I'd go for BB&T. Currently yielding 5.1%. This 14th large bank in the US has 104 year history of paying dividends, with a single penny cut during the depression. It has raised dividends for the last 36 years. Most importantly despite increase in non-performing loans, and credit loss, Its first quarter 08 earning exceeded Q1 07 earnings (albeit only by a penny). Pretty much every other bank I followed show year over year decrease in profits. With a PE of 11. and and payout ratio of 58% I think it has margin of safety despite the prospect of future loan losses in its south eastern base.

M* dividend investor has buy up to $37. and projects a 10% increase in dividends once the credit crisis is behind us. When that event happens is an exercise left to the reader
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What do you think now, a month later?
Old 05-28-2008, 09:44 AM   #8
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What do you think now, a month later?

BAC is at 33.52 as I write this with a div of over 7%. Its range has been between the now near 52 week low and to last month around 40. Unless there are some nasty surprises it looks like a good play. Even if it does not move much upward, it is still a nice div.
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Old 05-28-2008, 11:01 AM   #9
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Personally, I wouldn't buy BAC. Not because of it's stock performance or potential, but because I wouldn't bank there personally. Won't rant on about them, but all things considered NYB is the most conservative bank I can find with a decent yield.

Jim
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Old 05-28-2008, 04:16 PM   #10
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Thanks for the response. I am tempted to buy BAC. It closed at 33.87 giving it a 7.5% div. But I guess I will wait and see what happens. It will probably go back to 40 while I watch.

BTW, I don't bank there.
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Old 05-28-2008, 05:01 PM   #11
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Hmmm - BAC, JPM, C, UBS-AG all bought in the early 90's as under DRIP plans - often as other companies subsequently merged into the above.

Sloth says keep them unless they go under. If I decide to be an active trader - I may dump a few after twenty yrs - 2013 or so.

heh heh heh - greed/hormones has me looking at more BAC a tad, but keeping a grip so far.
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Old 06-04-2008, 04:31 PM   #12
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BAC at a new 52 week low......time to buy? (again for me )
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Old 06-04-2008, 04:47 PM   #13
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BAC at a new 52 week low......time to buy? (again for me )
Averaging down on single stocks, especially financial stocks, can be tricky. B of A is huge. It should be OK, but you can never tell. There are many safer possibilities, though perhaps none so totally wiped out.

I've been investing in single stocks now for 40 years- and my only 2 bk experiences were with financials- though not of the size or prominence of BAC.

ha
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Old 06-09-2008, 10:16 AM   #14
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Wow, trading at $30.43 at 11AM and a yield of 8.39%.

Gotta love that. But why is it tanking? Just overall market sentiment?
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Old 06-09-2008, 12:35 PM   #15
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I don't think the market is too keen on BOA's purchase of Countrywide and there are not enough believers that the dividend is going to be maintained to support the stock price. As was pointed out in the WSJ on Friday, the amount of construction loan writeoffs by banks was only .5% in 2007 but is expected to be 2.7% in 08 and nearly 5% in 2009.

Watching Central Pacific Financial try to exit California just as fast as they can (they plan on cutting their loan portfolio in the Mainland US from 1.2 Billion to 500 million in 3 years and cutting 75% of their US positions by the end of this year) confirms there are real problems with loans in that state. So as more and more banks report problems it puts doubts in the minds of people who might otherwise buy BOA stock. I would be a buyer at 12-13 though.
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Bought Some
Old 06-14-2008, 07:04 AM   #16
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Bought Some

I bought 100 shares at 32.40 but plan to hold for a while. If the Div continues it will pay 7.9%. However, it is now even lower so I just wonder if anyone is buying. I see some have suggested averaging down on this stock.
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Old 06-16-2008, 03:17 PM   #17
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I bought 10,000 shares today at 30.19, so it's bound to go to $15.10. Luckily I almost never lose more than half.
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Old 06-16-2008, 03:26 PM   #18
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$300,000.00!! That has got to be a significant percentage of your assets. Unless you know something that no one else does, that's quite a risk.
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Old 06-16-2008, 03:42 PM   #19
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In the Barron's mid-year Roundtable, Archie MacAllaster offered 3 bank stocks - JP Chase which he called the best managed, WFC which he called the growth story and BAC which he considered speculative.

Hard to say whether or not they will cut the divi. I can't tell what is in or what is not in their war chest but I usually don't trust the 7-8% yields on common stock. Still would take my chances on USB.

Bill Gross tossed out the idea of buying Countrywide which was trading about 10% below the offer price and throw in the yield.
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Old 06-16-2008, 03:49 PM   #20
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I currently own some. However, with the question about the dividend I feel no need to increase my stake. There are safer dividends out there.
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