3/17 Bears Stearns (BSC) goes for $2. Clearly their president "maximized shareholder value" as promised!. It is not over, but may be time to slowly nibble.
US Banking, Insurance and Brokerage is currently in crisis.. Cheap
money will be helpful, despite a difficult
economic environment, e.g. record bankrupties, housing crisis etc.. Best
performers
are distressed giants Citigroup that has been clobbered. Our public
forecast calls for Citibank to be the best {or one of the top)
performing Dow stocks in May. Will this be compan specific or sector
specific? Similarly,
brokerage stocks like Merrill will benefit from increasing profits and
trading,
albeit a recovery less robust than some bulls are hoping for. We await the next reporting period when banks will be forced by the SEC and the
Financial Accounting Standards Board (FASB) to acknowledge in annual
reports just how much (or little) some of their esoteric securities are
really worth.
Blue indicates price target has been met and that
we recommended buying in some portfolios.
Red indicates we have changed price target - up
or down - after quarterly forecast.
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| AMERICAN INTERNATIONAL | AIG | 3 | 2.5 | 45 | 53 |
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| BANK OF AMERICA | BAC | 3 | 2.5 | 38 | 44 |
| BANK OF NOVA SCOTIA | BNS | 2 | 2.5 | 44 | 48 |
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HANOVER INSURANCE
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TGH | 2.5 | 2.5 | 38 | 42 |
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JP MORGAN CHASE
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JPM
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3
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2.5
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36
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40
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MERRILL LYNCH
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MER
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3.5
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2.5
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40
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45
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STRONG BUY |
OUTPERFORM |
HOLD |
UNATTRACTIVE |
SELL |
NO OPINION |
On Watch:
Mizuho Holdings, UBS, USB, RBS.L, AFL
SUGGESTED USE
Ideally, one buys at a value price or better, stocks with a 1 or 2 rating.
In our view, one should NOT buy price alone. For example, just because
a stock is fairly valued, if it had a 4 or 5 rating, it is best to avoid
or under-weight. However, if a stock were well below our value
price and it has a 3 or better rating, it could be a profitable trade or
good investment. Remember, unless we are your personal money manager,
ALWAYS use our ratings IN COMBINATION with your own research or those of
your financial advisor or broker.
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