Bank of America (BAC)

The US banks had had a tremendous run. He is not surprised they pulled back a little bit. The shape of the interest curve is flattening and is not favoring the banks much. He just added to his portfolios. One of the few sectors he is long in the US in any significant way.

This stock needs to be evaluated in the broader outlook of the macro market drivers. He thinks this is one of the better national banks, because of the balance between retail and merchant banking. Goldman Sachs lacks the retail side, so their earnings are lumpy, for example. He expects a dividend increase. He has stayed away in general, favoring to cherry pick the regional banks in niche markets.

U.S. banks have been going sideways since February. His model suggests a 15% upside for B of A from this price. The bank pays only 18% of their earnings this year. The stress test will probably prompt positive announcements about its dividends. (Analysts’ price target is $34.48)

Money is being reallocated out of the financials after the run a year ago. This is because of the flattening yield curve. After the trade war threats blow over it will help equity markets, you will see growing dividends out of BAC-N and the stock will break $30. This is a nice holding for the next 10 years.

He likes U.S. financials, but are not testing their 100-week moving averages, so they're coming into great support levels now. He likes Bank of America.

He likes U.S. financials, but are not testing their 100-week moving averages, so they're coming into great support levels now. He likes Bank of America.

Once we get through trade issues we will start to see 10 year rates rise higher. He thinks loan growth will continue to grow in the US. This along with MG-N he has no problem putting into the portfolio.

He prefers the US banks to Canadian banks. US economy is stronger than Canadian for next couple of years. American banks are still recovering from 2008/09. US banks are much lower yields compared to Canadian banks but likely will increase. More upside in US banks but US banks will likely be more volatile. Long term, should do well and should benefit with steepening yield curve.

He continues to like this. Regulatory reform and roll back is allowing regional banks to do more deals with BAC-N. It is trading only 1.2 times book value – good valuation. A great franchise, with a good business model. You might get a better bang for your buck with KRE-N.

Hold for another 3-5 years? Has done very well since the crash. Good play on the US economy and consumer, and she is positive on both. You can continue to hold it. Banks should continue to do well, as long as US economy and consumer continue to. At end of June they should hear about capital return and any increase in dividend. Anticipates a dividend raise and share repurchase at that time.

(Past Top Pick on April 13, 2017, Up 37%) Have a great wealth franchise, investment bank, retail franchise and global operations. Also, banking regulations are changing in their favour. Warren Buffett owns 6%. The wind's at their back.

His favourite U.S. bank. Shares have pulled back, but earnings are kicking in. They're buying back a lot of shares and can increase their dividend. They are in the sweet spot with exposure to the boomingU.S. economy. Strong jobs report today points to continued strong U.S. economy. (Analysts' price target: $34.77)

Banks stocks have come under a lot of pressure recently. They look like a lot of value now. The recollection of what happened during the financial crisis is hanging over these banks. What’s going on in Italy brings fears of some instability seeping through. He doesn’t think so. As long as you have some US dollars, US banks are probably one of the best places to allocate capital. (Analysts’ price target is $34)

He's long BAC and prefers US to Canadian banks. Expect share buybacks by BAC for the next five years. There's a long runway here.

He likes the financials. 35% of their portfolio are financials. Better than expected results for Q1. Trading at 1.2 times price to book. He thinks there is going to be dividend increases going forward. In 2017 they announced a share buyback program for $17 billion. Pays a 1.6% dividend yield. (Analysts’ price target is $34.77)