Bank of America (BAC)

BAC vs. WFC Trading at same valuation. WFC yield is a bit higher, but has more scandals which continue to hurt their brand. Missed earnings, and missed 8 of last 12 quarters. BAC is more diversified in capital markets. BAC has beaten 12 of last 12 quarters. BAC has outperformed WFC since 2011.

BAC vs. JPM Driving US banks is a strong economy and flat yield curve. Unlike last year, bank movement now will be on a valuation basis. JPM trades at a 50% premium to book value, and BAC at book value, but Citibank (which he owns) trades at 70% book value and is narrowing that gap. Citi is his choice.

Have interest rates bottomed out? JPM's earnings were spectacular and so he thinks there is no reason why this one can't do as well. He prefers JPM-N from an execution point of view.

BAC-N or C-N? He owns BAC and liked their recent earnings announcement. BAC is more of a traditional structure, but is more conservative as a result. C has more leverage however. The US banking sector looks good and is well priced. He would buy more BAC on weakness on a pullback.

BAC-N vs C-N? When Donald Trump became President, he bought both these stocks. He thinks BAC-N can go to $36.84 and stays around his definition of book value. C-N has moved up on positive fundamentals and he sees $114 as value. He would prefer C over BAC-N. Both should do well in the long run.

JPM vs. BAC Both are first-class banks. He owns JPM which trades at a much higher valuation than BAC. Both are tops in their business lines. For the next 5-10 years they'll be in a sweet spot of reducing costs with few regulatory issues to deal with. They'll use tech to drive their business, an advantage for larger banks who can afford that. They will do some small acquisitions. They should be trading at higher multiples. Cash flow allows them to raise dividends and buyback shares. Their payout ratios are much lower than those of Canadian banks.