Long-Term Investor in Bank of America? What to Do Ahead of Earnings

By ChartLabPro.com  OCT 16, 2012 3:10 PM

Plus, the reasons Citibank is now a buying opportunity.


MINYANVILLE ORIGINAL Tomorrow Bank of America (NYSE:BAC) will report earnings. The company is expected to report Q3 earnings of -$0.07 EPS according to Thomson Reuters. We went to a Buy in this name back on August 24 (see A Look at Banking Stocks, Including Wells Fargo, Bank of America, and JPMorgan). Bank of America is trading off 1.50% from its highs and has rolled over; we would not read anything into this. If you’re a long term investor, we suggest remaining long at this juncture.

We also mentioned this morning at 9:00 a.m. (pre-market) that Vikram Pandit's departure from Citigroup (NYSE:C) was an opportunity to buy (see Vikram Pandit's Departure From Citibank Means Buying Opportunity for Investors -- But Wait!). We had several emails this morning asking why we felt this way. For one, there was the positive price action off a solid earnings report. Another reason was that the regulators didn’t like Pandit. If you've ever been involved with a bank on the operating side, you would realize this is a big issue in growing a bank’s balance sheet. Citigroup is no longer the complex behemoth it once was, and it sold off many assets. It is easier to replace Pandit with a traditional banker now than it was prior to the divestitures of the other business lines.

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No positions in stocks mentioned.

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