Don Vialoux Bank of America BAC-N COMMENT Dec 22, 2017

Loves the money-centre banks. Not quite as expensive as JPM, but more interest-rate sensitive. A gently falling interest-rate environment (which he thinks will come to pass, though it's up for debate), net interest margins will widen and that's traditionally good for banks. Capital markets business has really built up, and will open up post-Biden. Economy in pretty good shape. Undemanding valuation. Yield is 2.3%.

Likes US financials. Quietly up ~49% last 12 months. Just watch that's it's coming up to potential resistance around $50, which it hit in early 2022. If it breaks above, great sign; but might also bounce down below it. He owns GS. 

See his Top Picks.

If the US consumer struggles and can't buy goods and job losses rise due to tariffs, this will slow down the economy and directly impact banks like BAC. It's hard to know where tariffs are going. The dividend is high and BAC has a good, long track record. Best to collect the dividend and wait.

Financial sector offers great promise, though it's reacted to current markets by pricing in a potential recession. Slower economic growth would not be good for banks. Absent a recession, with consumer confidence returning and unleashing M&A, the sector provides a good opportunity.

A less expensive choice further down the food chain from the likes of JPM.

Still positive on financial sector and on money centre banks in particular. Yield curve is starting to normalize, a positive for banks. 

He'd rather an investor look at JPM. JPM has a rock-solid balance sheet, and probably the best technology platform and management.

Likes TD a lot. Very undervalued at 10x PE. Potential for multiple to rerate in medium term. More upside as it distances itself from the overhang of regulatory infractions. All that should give you a better total return. He'd pick TD.

For BAC, even with deregulation in US, the big banks are already so large, it's hard to imagine they'd be allowed to get even bigger.

Stock's fallen a fair bit, which was unexpected given the numbers reported last week. Lots of capital; lots of room to increase dividend and buy back shares. Environment is tough with potential recession. Trading at 1x book, 10x PE. Some of the best businesses in the world -- asset management, financial services, capital markets (one of the top 4 players globally), retail, credit cards. Yield is 2.74%.

High quality. Globalization is starting to move in a different direction, so this option provides a more domestic focus.

The US banks are cheap in valuation, and benefit from an M&A cycle that will come.