Guys,
I advise we stay off the banking sector for now. I do not think we have seen the bottom yet as the US sub-prime mortgage crisis is not yet over. Most analysts believe that Citigroup will likely cut the dividend in Q1 2008 which will cause further erosion in share values.
I see BAC as a good buy but it becomes a screaming buy with some margin of safety if or when it falls below $40/shr. I recommend this stock because it is still a very solid bank with good fundamentals and relatively minimal exposure to sub-prime related writedowns. It is a good income stock as the dividend seems solidly secure in the face of current crisis in the sector.
Even at $40/shr you are getting a sweet 6% dividend yield
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1 comment:
Great! thank you Kunle for opening the blog!
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