Bank of America Corp.'s first-quarter income fell 39 percent on higher costs related to its mortgage business and higher litigation expenses. The bank also settled a claim over faulty mortgage investments and set aside less money to cover soured loans.
The Charlotte, N.C. bank on Friday said it earned $1.7 billion, or 17 cents per share, compared with $2.8 billion, or 28 cents a share in the first quarter of last year. The earnings fell short of the 28 cents a share estimated by analysts surveyed by FactSet.
Revenue fell to $26.9 billion from $32 billion in the same period last year.
The nation's largest bank by assets also announced that the bank's chief risk officer, Bruce Thompson, will become chief financial officer, replacing Chuck Noski, who was named vice chairman. Noski couldn't relocate to Charlotte to fulfill his CFO duties because of an illness of a close family member, the bank said in a statement.
Bank of America continued to fight losses, lawsuits and higher costs related to its mortgage businesses. Its real estate services business reported a loss of $2.4 billion compared to loss of $2.1 billion for the same period in 2010.
Continue reading Bank of America Earnings Fall 39%
NYSE Euronext (NYX) acquired American Stock Exchange (Amex) in 2008 to expand its equities, options and exchange-traded funds (ETFs) trading business. Recently NYSE announced plans to sell the majority of its stake in the Amex stock options market to seven companies -- including top banks, trading houses and brokerages. With this move, the company hopes to increase its trading volumes by giving major brokerages an incentive to bring their business to Amex. Major competitors are Nasdaq OMX (NDAQ), CME Group (CME), BATS Global and Direct Edge.
Continue reading NYSE Looks at Selling Stakes in Amex Exchange to Drive Volumes
Fourth quarter GDP ended on a uptrend, coming in at 3.1%. The state of the economy was healthy and it looked like growth would continue to match or exceed Q4. Based on that scenario, Bank of America (BAC) analyst Ethan Harris, forecast first-quarter 2011 GDP to come in at 3.3%.
But in the few short months of 2011, the world is getting turned upside down. The conflict in Libya has cut OPEC oil production and sent oil prices skyrocketing. In turn, the price of gasoline is nearing $4.00 per gallon. And food processors are raising prices due to higher raw commodity prices. These two factors have put a dent in the household budget.
Continue reading Bank of America Cuts First-Quarter GDP Forecast
Bank of America (BAC) is a pretty big player in its industry; it's got brand equity -- everyone has heard of it. How is its stock looking these days?
At the time of writing, shares could be had for $13.44. The 52-week low for the company is $10.91; the 52-week high is $19.86. That's a tight range, and as one might imagine, this company has been a vehicle for traders trying to ride whatever volatility is available at any given time.
Continue reading BAC: Checking In on Bank of America's Stock
It should surprise no one that oil stocks have taken the lead in the first quarter, while financial stocks -- after a good two-year run -- have been tamed. This is how things have shaped up through the first quarter for my 2011 stock picks. (For a look at my original picks, see here: part 1, part 2,
and part 3
Normally, if I said a business was underwater, investors would think the worst. Actually, in the summer Noble Corp (NE
) was underwater -- and investors were not impressed. However, this was a great buying opportunity, and although the company is still underwater, it is also a market leader among my stock picks and the overall market -- even among oil industry players. With its fleet of 69 offshore drilling rigs, Noble stands tall.
Continue reading Chasing Value: 2011 Stock Picks Q1 Review -- A Platform for Success
Let's go back to the financial crisis and the practices that brought this country to its knees. Banks developed a fancy scheme whereby they absolved themselves of all risk from the loans they made. They simply wrapped them up in a bundle and sold them to someone else. What they were doing is essentially packaging and reselling "junk."
When the news of how bad things were became known, the markets froze and collapsed. No one knew who had which securities, and if they did, they didn't know their true value.
Continue reading Banks Lobby Against Risk Retention on the Loans They Make
- Red Hat (RHT) to outperform from neutral at RW Baird.
- Cogdell Spencer (CSA) to buy from hold at Citigroup.
- Micron (MU) to neutral from reduce at Nomura.
- El Paso Electric (EE) to buy from hold at Jefferies.
- MICROS Systems (MCRS) and Harmony Gold (HMY) to outperform from sector perform at RBC Capital.
- Meridian Bioscience (VIVO) to buy from hold at Canaccord.
- Verso Paper (VRS) to outperform from neutral at Credit Suisse.
- Sony (SNE) to buy from hold at Deutsche Bank.
- Noble Corp. (NE) and Baker Hughes (BHI) to buy from neutral at UBS.
- Tyson Foods (TSN) and Smithfield Foods (SFD) to buy from hold at BB&T.
Continue reading Analyst Calls: BAC, BHI, KKR, MU, NE, RHT, SNE, TSN, WMT ...
Charles Schwab (SCHW) has announced its decision to acquire optionsXpress (OXPS) in a friendly all-stock deal. This deal will help Schwab compete with other firms like E-Trade (ETFC), Ameritrade (AMTD), and Bank of America (BAC), which all have large online brokerage services and are vying to provide investors with the best tools and services.
The deal, which is expected to close by the third quarter of 2011, will cost Schwab $1 billion, and the company will issue 60 million new shares to swap each outstanding share of optionsXpress with 1.02 of its own shares. Our $19.74 price estimate for Charles Schwab is at a premium of almost 12% to its current market value.
Continue reading Chuck Adds optionsXpress to Schwab's Portfolio
Just when we thought the banking crisis was finished, we get another jolt. The U.S. Federal Reserve denied Bank of American (BAC) permission to raise its dividend.
If you recall, Bank of America is still struggling to absorb toxic assets it acquired with its purchase of Countrywide Mortgage. It has been on a slow climb back to fiscal health. At the end of 2010 the company was still bleeding, with a net loss of $1.2 billion.
Continue reading Fed Says No to Bank of America Dividend Increase
Monday could have been far worse. Japan led things south with news that the nuclear reactors were not shut down and could pose serious risks ahead. This sent Japan's NIKKEI 225 down more than 6% and back under the dreaded 10,000 mark. US markets held up better than expected, while news that Saudi troops were being asked to enter into protect Bahrain's infrastructure sent oil back up. US markets came back from larger losses late in the session.
Here were today's unofficial closing bell levels:
Dow Jones 11,993.16 -51.24 (-0.43%)
S&P 500 1,296.39 -7.89 (-0.60%)
Nasdaq 2,700.97 -14.64 (-0.54%)
Top analyst upgrades and downgrades
Top Japanese fund, ETF, and ADR movers
Continue reading Closing Bell: Woes Move from North Africa to Japan (FSLR, BTU, CCJ, CBLI, NDAQ, NYX, BAC, GE, TM)
Banks are back in the news -- in a good way. Speculation is that mergers and acquisitions will be picking up, so are profits. Some are looking to raise their dividend and/or buy back more shares. Bank of America (BAC) is one of them.
The CEO, Brian Moynihan, announced that B of A wasn't looking to buy other banks. Instead, the bank would be focused on returning more capital to shareholders in the form of a regular dividend (now 4 cents a year), share buybacks and special cash dividends. The reason: he feels the bank will earn between $35 billion and $40 billion a year (yes, billion ... a year) in pretax earnings when the business normalizes. (But there's the catch: when does business get to normal?)
Continue reading Comfort Zone Investing: Are the Banks Back?
Back in the summer of 2010 when the market was down, the gulf was full of spewing oil and investors were running away from bad news stocks shocked most notably by BP (BP
) oil spill, I decided to post a contrarian story
reminding readers that the fear was overblown and created a buying opportunity.
"My pal Warren" has said for years that we should buy on fear and sell on greed. The toxic stock portfolio was a result of this sentiment.
This is the fourth update to my ranting eight months ago that acquiring six of the most hated, and most highly traded stocks with constant negative headlines would outperform the overall market. The theory has born fruit as the toxic stocks are ahead and the difference is increasing over time.
Continue reading Chasing Value: Toxic Stock Update #4 -- BAC, BP, C, GE, GS, RIG
"Even when the market is up a lot, you can always find some good stocks that have been left behind but could be on the verge of a rebound," says George Putnam.
The editor of The Turnaround Letter explains, "That's where we suggest you focus your efforts right now. These eight stocks all have strong business franchises and have all significantly lagged the market over the last two years.
"In fact, several of them are still trading near or even below where they were in early 2009. Here, we look at Bank of America (BAC), Best Buy (BBY), Campbell Soup (CPB), Cisco Systems (CSCO), Microsoft (MSFT) and Sprint Nextel (S).
Continue reading Turnaround Expert: A Six-Pack of Rebound Buys
Oil inventories failed to markedly turn the tide despite more and more public commentary (and perhaps realization) that Libya and unrest elsewhere that is currently on the table may have gone too far in oil. Still, the fear is what lies ahead tomorrow rather than what is happening today. PIMCO's Bill Gross has exited US Treasury bonds from the PIMCO Total Return Fund as well. The markets fought between being up and down on the two-year anniversary of the start of the end of the bear market.
Here were today's closing bells:
Dow Jones 12,213.09 -1.29 (-0.01%)
S&P 500 1,320.03 -1.79 (-0.14%)
Nasdaq 2,751.72 -14.05 (-0.51%)
Continue reading Closing Bell: Celebrating the Death of the Bears, Sort of (AEO, BAC, FNSR, POT, ROYL)
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