One Analyst Thinks Banks Are A Steal

I don’t know if this guy is smoking something illegal or if he has insights that everyone else has missed, but he deserves a hearing on guts alone. Richard Bove, a bank analyst thinks bank stocks are an excellent value and that the negative assumptions about the U.S. economy may be excessive.

Mr. Bove sees profits coming from a mortgage boom and feels that the consumer now looks on banks as a safe haven. He indicates that banks need to add to capital just to offset the drain that losses are imposing. Nevertheless, gains in asset quality as the economy improves will largely take care of this problem and not jeopardize dividends, according to Mr. Bove.

Certainly against the grain but you do have to admire a guy that will come out and put his name on such a contrarian prediction. I hope he’s right.

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