24/7 Wall St. » BK

Big Changes to Buffett and Berkshire Hathaway Stock Holdings, A to Z

Administrator — Tue, 15 May 2012 21:05:01 +0000

Berkshire Hathaway Inc. (NYSE: BRK-B, BRK-A) and Warren Buffett have just released their most recent U.S.-listed equity holdings for the Berkshire Hathaway empire. This cut off date is as of March 31, 2012 and Mr. Buffett has already said that he was buying some shares since the end of the quarter on weakness.

Also, keep in mind that portfolio managers Todd Combs and Ted Weschler are still new and those new positions of under $200 million $300 million are likely tied to them.

24/7 Wall St. has gone through line by line of each position to see which stocks have been bought and sold as new positions, as well as having added in whether or not the number of shares grew or shrank on each since the prior quarter. We had added some color in on some of the positions if applicable.

Be advised that the number of subsidiaries that this filing covers is 14 entities rather than 18 entities in the prior quarter. There is also a note in the 13F filing showing that the SEC has granted “Confidential Treatment” on some Berkshire stock holdings and that likely suggests that Buffett is still acquiring a position he does not want the public to know about yet. This filing does not signal the half-dozen or more European shares that Buffett said he bought so that remains an outstanding issue as well.

The value of the stock portfolio was $66,151,587,000 at the end of 2011 and this was listed as $75,300,250,000 at the end of March 2012.

American Express Co. (NYSE: AXP) was over 151.6 million shares, SAME AS last quarter.

Bank of New York Mellon Corp. (NYSE: BK) is now 5.6 million shares, HIGHER THAN the 1,793,915 shares last quarter.

CVS Caremark Corporation (NYSE: CVS) is the SAME SIZE at 7.106 million shares after having been a new holding in a recent quarter and having been raised one quarter ago.

Coca Cola Co. (NYSE: KO) was right at 200 million shares, SAME AS BEFORE.

ConocoPhillips (NYSE: COP) is roughly 29.1 million shares, roughly the SAME AS BEFORE but it is still lower than previous quarters in past reports.

Costco Wholesale (NASDAQ: COST) 4,333,363 Shares, SAME AS last quarter after having lowered it before.

Da Vita Inc. (NYSE: DVA) is now 6 million shares worth $541 million and that LARGER THAN BEFORE after having been a new position of 2.684 million shares.

DirecTV (NASDAQ: DTV) is a LARGER POSITION listed at 22.999 million worth over $1.13 billion. This one had been 20.348 million shares worth $870 million one quarter earlier and it had been a new position just two quarters ago at 4.249 million shares.

Filed under: Activist Investor, Buffett, Buffett Holdings, Compensation, Conglomerates, Insider Activity, Mutual Funds Tagged: AXP, BK, BRK-A, BRK-B, CDCO, COP, COST, CVS, DG, DVA, featured, GCI, GE, GM, GSK, IBM, INTC, IR, JNJ, KFT, KO, LMCA, MA, MCO, MTB, PG, SNY, TMK, UPS, USB, USG, V, VIA, VRSK, WFC, WMT, WPO

What Happens to Warren Buffett’s Top 10 Performing Stocks of 2012? (BRK-B, BRK-A, USG, IR, MCO, AXP, WFC, V, BK, VRSK, INTC, MA, AAPL, JNJ, BAC)

Administrator — Wed, 18 Apr 2012 10:46:56 +0000

Berkshire Hathaway Inc. (NYSE: BRK-A) (NYSE: BRK-B) will be in the news quite a bit now that the world’s most famous investor, chairman Warren Buffett, has been diagnosed with prostate cancer. We already have offered a brief road map of what investors can expect in the months ahead based on the face value of the news and based on Mr. Buffett’s comments. With so many investors wondering what comes next, we wanted to take a look at Berkshire Hathaway’s best-performing stock holdings so far in 2012.

Some investors may worry that, if Buffett were to leave, the portfolio would perhaps find a large rotation out of current positions. While anything is possible, we expect almost no change whatsoever to the Berkshire Hathaway portfolio based on the cancer news. Some new stocks may still get added with two new portfolio managers inside the conglomerate. Some stocks also may get paired down further. That being said, Buffett has treated these holdings in many cases as though they are “partner companies” rather than mere stock investments that are to be bought and sold solely based on the price gain or loss at a certain time.

Buffett’s top 10 performers so far this year are significantly outperforming the broader market indexes. The DJIA is currently up about 8.1% so far in 2012, and the S&P 500 Index is outperforming the DJIA with a gain of 11.3%, due to such a high weighting and strong performance of Apple Inc. (NASDAQ: AAPL). Berkshire Hathaway Inc. (NYSE: BRK-A) is only up by 5.7% so far in 2012, and that is before the effect of Buffett’s cancer news. Only one of Berkshire Hathaway’s 30-plus common stocks is down so far in 2012, and that is Johnson & Johnson (NYSE: JNJ), with a loss of only 1.2%.

What was most interesting about the holdings noted as 2012’s 10 best performers is that the dividends are often paltry. Most have dividend yields that are well below average. We have given some color on each position, shown some trends on each, and shown the price and relative price performance on each. It is no coincidence that the financial stocks in the Berkshire Hathaway portfolio are up so much when you consider that the financial sector led the market in the first quarter and so far this year.

USG Corporation (NYSE: USG) is Warren Buffett’s single best stock performer so far in 2012, as Americans continue to look for ways to play a coming housing recovery. The latest NAHB confidence dip may be a concern, but perhaps a remodel housing economy can be enough to return a turnaround here. What is interesting is that Thomson Reuters is currently looking for a loss of $1.30 per share in 2012 and a loss of $0.52 in 2013, despite what it expects to be rising sales. Unlike most of Buffett’s top stocks, USG pays no common dividend. The $16.89 share price compares too a 52-week trading range of $5.75 to $19.44.

Ingersoll-Rand Plc (NYSE: IR) turned out to be Buffett’s second-best common stock in 2012, with a gain of 32%. The company makes tools, compressed air systems, ARO fluid products and lifting and material handling products, among other products and services. The dividend yield here is roughly 1.6%. At $40.06, its 52-week trading range is $25.86 to $52.33.

Filed under: Activist Investor, Banking, Buffett, Conglomerates, Dividend, Editor's Picks, Financial Stocks, Insider Activity, Large Cap Stocks, Mutual Funds, Shareholder Issues Tagged: AAPL, AXP, BAC, BK, BRK-A, BRK-B, INTC, IR, JNJ, MA, MCO, USG, V, VRSK, WFC

Big Banks Still At Big Discounts To Book Value Before Earnings (BAC, BK, C, GS, JPM, MS, NTRS, STT, STI, USB, WFC)

Administrator — Tue, 10 Apr 2012 12:10:09 +0000

This week will be the start of earnings season as we get to start reviewing some key earnings for first quarter of 2012. The banking sector is going to be of particular interest since we have had such a strong rally in financials since the end of December. Many banks have gotten permission to raise their dividends and buy back shares, and many of the key banks are still trading at substantial discounts to book value and/or tangible book value.

We will be paying extra attention to the money center banks of Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), J.P. Morgan Chase & Co. (NYSE: JPM), and Wells Fargo & Co. (NYSE: WFC). We will also be watching the bank holdings companies without any bank operations from Goldman Sachs Group Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS). On the trust bank side and fiduciary side, there is Bank of New York Mellon Corporation (NYSE: BK), State Street Corporation (NYSE: STT), and also Northern Trust Corporation (NASDAQ: NTRS).

We have shown the most recent closing prices, added in the Thomson Reuters consensus price target objective, and added in a 52-week trading range. We have then shown the tangible book value and/or the stated book value, depending upon what was available from each bank. The book values were taken from January press releases as of the end of 2011, but a couple had to be taken from ycharts.com as they did not report their stated book values. You will see some of the banks still trade at healthy discounts to their book value and to their tangible book values, while others now trade at premiums again.

Bank of America Corporation (NYSE: BAC) recently closed at $8.93, its Thomson Reuters consensus target is currently $9.79, and the 52-week trading range is $4.92 to $13.64. The company most recently noted that its tangible book value per share was $12.95 at December 31, 2011, compared to $12.98 at December 31, 2010. The stated book value per share was $20.09 at December 31, 2011, compared to $20.99 at December 31, 2010.

Bank of New York Mellon Corporation (NYSE: BK) recently closed at $23.34, its Thomson Reuters consensus target is currently $25.67, and its 52-week range is $17.10 to $30.29. The bank most recently noted that its book value was $27.62 at the end of 2011, down slightly from the $27.79 at the end of the third quarter but up from $26.06 at the end of 2010. On a tangible book value per share, that figure was $10.57 at the end of 2011 versus $10.55 at the end of the third quarter and up from $8.91 at the end of 2010.

Filed under: 24/7 Wall St. Wire, Accounting, Banking, Brokerage Firms, Earnings, Economy, Editor's Picks, Financial Stocks, Value Investing Tagged: BAC, BK, C, GS, JPM, MS, NTRS, STI, STT, USB, WFC

Looking for Big Dividends & Buybacks After Stress Tests (JPM, WFC, C, BAC, BK, STT, GS, MS)

Administrator — Mon, 12 Mar 2012 16:34:14 +0000

The next wave of stress tests on the U.S banks is due to come out by the end of this week. The Federal Reserve is expected to show that bank balance sheets have improved, and regulators are likely to allow big dividend hikes and buybacks to return to somewhat normalized levels. Deciding how much these big banks can really raise their dividends is one issue, but more important is that the banks may still remain conservative in their payouts. Doubling or tripling dividends might be possible, but most managers do not want any public backlash and they may opt to just do nominal dividend hikes along with larger share buybacks.

J.P. Morgan Chase & Co. (NYSE: JPM) is likely to be the first of the too big to fail banks to raise its shareholder payouts. JPMorgan might not double its dividend from the current $1.00 now (about 2.4% yield) to $2.00 (about 4.8%) on an annualized basis, but Thomson Reuters has estimates of $4.70 EPS in 2012. A 40% payout ratio would take the dividend to about $1.88 on an annualized basis. Expecting an 88% hike seems high, but that implies a 50% dividend hike is very doable and a large buyback will come.

Wells Fargo & Co. (NYSE: WFC) pays out $0.48 on an annualized basis today, and Thomson Reuters has estimates of $3.20 EPS for 2012. A 40% payout ratio would generate $1.28 on an annualized basis or about 4.1%. We do not expect that it will raise the payout that much, but it may use much of its excess liquidity to buy back stock selectively.

Bank of New York Mellon Corporation (NYSE: BK) and State Street Corporation (NYSE: STT) are both also expected to come out fine in the stress tests. These banks could probably double their dividends based upon expected earnings of the trust banks, but we are not as sure that they will formally do that. Bank of New York pays out $0.52 annualized today and yields 2.3%, and Thomson Reuters has estimates of $2.25 EPS for 2012; a 40% payout ratio would generate a $0.90 per year dividend and that yields close to 4%.

Bank of America Corporation (NYSE: BAC) and Citigroup, Inc. (NYSE: C) are both expected to try to increase their dividends and share buybacks. Prince Alwaleed bin Talal has recently said he would demand Mr. Vikram hikes the payout soon. Bank of America does not have a key holder making the same demands and it is still up for grabs as to just how much the bank will really have to allocate for mortgage losses and other settlements. BofA could be a disappointment on the dividends and buybacks. If it was just having to raise capital last year, regulators are likely to be less eager to allow Bank of America to start sending money out the backdoor to its shareholders.

Of the bulge bracket investment banks, remember that these are bank holding companies that really have no bank operations. Goldman Sachs Group, Inc. (NYSE: GS) yields only about 1.2% today and Morgan Stanley (NYSE: MS) yields about 1.1% today. Each are expected to be able to raise their dividends, but these banks are still more dependent upon the trends of financial market trading and investment banking than they are real loan and balance sheet performance of the traditional banks.

Starting on Monday we should be getting more of a focus on the stress tests. This week has been dominated by Greece and a slowing story of China and Brazil. More details and more predictions should start coming front and center on Monday.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Banking, Brokerage Firms, Corporate Governance, Dividend, Financial Stocks, Regulation, Shareholder Issues Tagged: BAC, BK, C, GS, JPM, MS, STT, WFC

After Bank Stress Tests: Dividend & Buyback Predictions… A Double? (JPM, WFC, BK, STT, BAC, C, GS, MS)

Administrator — Thu, 08 Mar 2012 17:35:44 +0000

The next wave of stress tests on the U.S banks is due in the coming week. While many of the banks have reportedly been asking regulators to be less transparent, there are some banks which are likely to come out well ahead under almost all scenarios. The big trick is not just figuring out how much these big banks can really raise their dividends, but how much they really will start paying back to avoid public backlash. Some banks could easily double their dividends and some could triple their dividends. We expect dividend hikes, but some will likely choose share buybacks plus dividend hikes rather than throwing it all into dividends.

J.P. Morgan Chase & Co. (NYSE: JPM) is likely to be the major winner when it comes to dividend hikes and buybacks as far as the safe banks of the “too big to fail” institutions. JPMorgan might not double its dividend from the current $1.00 now to $2.00 on an annualized basis, but it might be able to if it believes that it can sustain $4.00+ in earnings per share. The bank is likely to do a 50% dividend boost at first and begin buying back stock more selectively.

Wells Fargo & Co. (NYSE: WFC) could take its dividend up to $1.50 per share per year with its earnings estimates above $3.00 per share for each of the next two years and that would be a tripling of the payout today. We do not expect that it will raise the payout that much (from only $0.48 annualized today), but it may use much of its excess liquidity to buy back stock selectively.

Bank of America Corporation (NYSE: BAC) and Citigroup, Inc. (NYSE: C) are both expected to try to increase their dividends and share buybacks. Prince Alwaleed bin Talal has already suggested that he will be demanding that Citi raise its dividend. The question is Bank of America because it was only a few months ago that the run on the bank was feared and that Warren Buffett came to the rescue. If it was just having to raise capital last year, regulators are likely to be less eager to allow Bank of America to start sending money out the backdoor to its shareholders.

Of the bulge bracket investment banks, ergo bank holding companies which have no bank operations, there is the case of Goldman Sachs Group, Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS). Each are expected to be able to raise their dividends, but these banks are still more dependent upon the trends of the financial markets than they are real loan and balance sheet performance of the traditional banks.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Banking, Dividend, Financial Stocks, Regulation Tagged: BAC, BK, C, GS, JPM, MS, STT, WFC

Buffett & Berkshire Hathaway Stock Holdings, A to K (BRK-B, BRK-A, AXP, BK, KO, CVS, CDCO, COP, COST, DVA, DG, GCI, GE, GSK, INTC, IR, IBM, JNJ, KFT, XOM)

Administrator — Tue, 14 Feb 2012 21:48:43 +0000

Berkshire Hathaway Inc. (NYSE: BRK-B, BRK-A) and Warren Buffett have just released the latest holdings of U.S.-listed equities as of December 30, 2011. These public stock holdings have been broken down into two groups so it is more concise. Keep in mind that portfolio manager Todd Combs is still relatively new and none of the positions from the newer portfolio manager Ted Weschler will likely be reflected at all in these positions yet as the cut-off date is December 31, 2011.

American Express Co. (NYSE: AXP) was over 151.6 million shares, SAME AS last quarter.
Bank of New York Mellon Corp. (NYSE: BK) was 1,793,915 shares, SAME AS last quarter.
CVS Caremark Corporation (NYSE: CVS) is LARGER POSITION at 7.106 million shares after having been a new holding in a recent quarter.
Comdisco Holdings (NASDAQ: CDCO) was roughly 1.5 million shares, SAME AS BEFORE.
Coca Cola Co. (NYSE: KO) was right at 200 million shares, SAME AS BEFORE.
ConocoPhillips (NYSE: COP) is roughly 29.1 million shares, roughly the SAME AS BEFORE but it is still lower than previous quarters.
Costco Wholesale (NASDAQ: COST) 4,333,363 Shares, SAME AS last quarter after having lowered it before.
Da Vita Inc. (NYSE: DVA) is a NEW POSITION of 2.684 million shares worth $203 million.
DirecTV (NASDAQ: DTV) is a LARGER POSITION listed as 20.348 million shares worth $870 million; was a new position of 4.249 million shares one quarter earlier.
Dollar General Corporation (NYSE: DG) is that SAME SIZE as before at 4.497 million shares; was a new position and a grown position before. This one of our Top Stocks for the Next Decade.
Gannett Co. (NYSE: GCI) was 1.74 million, SAME AS BEFORE but decreased in prior quarters.
General Dynamics Corporation (NYSE: GD) is a LARGER POSITION of 3.877 million shares worth $257 million after being a new position before of 3.064 million shares.
General Electric Corp. (NYSE: GE) is 7.777 million shares; SAME AS before.
GlaxoSmithKline (NYSE: GSK) 1.51 million shares, SAME AS last quarter.
Ingersoll-Rand (NYSE: IR) was 636,600; SAME AS last quarter but still way down from prior reports.
Intel Corporation (NASDAQ: INTC) is a LARGER POSITION of 11.495 million shares worth $278 million; this was a new position of 9.333 million shares last quarter.
International Business Machines Corporation (NYSE: IBM) is now 63.905 million shares worth some $11.75 billion now after having been a new position with an average cost of about $170 per share.
Johnson & Johnson (NYSE: JNJ) was a LOWER POSITION of about 29 million shares; lower than 37.4 million last quarter and way under the peak of 62 million shares at one point in prior quarters.
Kraft Foods (NYSE: KFT) was a LOWER POSITION at about 87 million shares, down from 89.7+ million last quarter and this has continued to be lightened up since the Cadbury purchase.

Exxon Mobil Corp. (NYSE: XOM) was ELIMINATED FROM THE PORTFOLIO after having been only 421,800 shares last quarter and lowered earlier.

PAGE TWO…BUFFETT HOLDINGS ‘L to Z’

JON C. OGG

Filed under: 24/7 Wall St. Wire, Buffett, Buffett Holdings, Conglomerates, Mutual Funds, Personal Finance, Private Equity Tagged: AXP, BK, BRK-A, BRK-B, CDCO, COP, COST, CVS, DG, DVA, GCI, GE, GSK, IBM, INTC, IR, JNJ, KFT, KO, XOM

Bank of New York Versus State Street Earnings… Two Different Tales (BK, STT)

Administrator — Wed, 18 Jan 2012 12:39:17 +0000

Bank of New York Mellon (NYSE: BK) is in a different boat than State Street Corporation (NYSE: STT) after earnings this morning.

Bank of New York missed on the top and bottom line with earnings of $0.42 EPS versus $0.52 estimates; revenues were down over 5% to $3.54 billion versus the $3.74 billion estimate. Assets under custody and administration rose 3% to $25.8 trillion; Assets under management were up 8% to $1.26 trillion. The company talked up general uncertainty in the financial markets and lower levels of client activity.

State Street reported $0.93 EPS after charges versus $0.94 EPS estimates; revenue rose by 13% to $2.315 billion versus estimates of $2.4 billion. The company ended with a tier 1 common ratio of 16.9% and it has submitted its 2012 capital plan to the Federal Reserve Bank with plans for dividends and our share repurchases.

Bank of New York is down 3.6% at $20.49 and State Street has not yet started trading and we have not yet started seeing early indications in the early pre-market with about two hours until trading opens in New York.

JON C. OGG

Filed under: Banking, Brokerage Firms, Earnings, Economy, Financial Stocks Tagged: BK, STT

Many More Banks Report Earnings This Week (GS, STT, BK, USB, NTRS, AXP, BAC, MS, COF)

Administrator — Tue, 17 Jan 2012 16:20:59 +0000

We have already seen the first wave of bank earnings, but the rest of the week is full of bank and financial earnings. In fact, the real bank earnings season is all taking place on Wednesday and Thursday of this week.

We have compiled basic earnings previews and shown Thomson Reuters estimates from the following: Goldman Sachs Group Inc. (NYSE: GS); State Street Corporation (NYSE: STT); Bank Of New York Mellon Corp. (NYSE: BK); U.S. Bancorp (NYSE: USB); Northern Trust Corporation (NASDAQ: NTRS); American Express Co. (NYSE: AXP); Bank of America Corporation (NYSE: BAC); Morgan Stanley (NYSE: MS); and Capital One Financial Corporation (NYSE: COF).

Goldman Sachs Group Inc. (NYSE: GS) is set to report earnings on Wednesday morning and the earnings estimates have been coming down more than just marginally ahead of the expected earnings report. It is no longer expected to have the name “Golden Slacks” attached as a nickname right now. The current target is $1.24 EPS on $6.54 billion in sales, but the earnings targets were above $2.00 EPS recently and the street expected almost $3.00 just about 90 days ago.

State Street Corporation (NYSE: STT) is set to report earnings on Wednesday morning and the consensus estimate for the trust and custodial bank is expected to rise about 8% to $0.94 EPS. Bank Of New York Mellon Corp. (NYSE: BK) is set to report earnings on Wednesday morning and the earnings estimates are $0.53 EPS and $3.75 billion in revenues. We will be waiting to see if any of the charges to trust and custodial customers taking the cash holdings operations to a cost rather than as an interest bearing account will have made a difference. That seems to have gone away but it may have just been lost in the shuffle.

U.S. Bancorp (NYSE: USB) is expected to report earnings on Wednesday morning. The estimates are $0.63 EPS on $4.76 billion in sales. Northern Trust Corporation (NASDAQ: NTRS) is also due Wednesday morning and estimates are $0.68 EPS and $972.3 million.

American Express Co. (NYSE: AXP) is due on Thursday after the close and earnings estimates are $0.98 EPS and $7.92 billion in sales. As with the rest of the lenders and credit cards, we expect to hear continued improvements in credit metrics regarding the customer base.

Bank of America Corporation (NYSE: BAC) is due to report on Thursday morning. The most unpopular of the big ‘too big to fail’ money-center banks in America, has a consensus earnings estimate of $0.23 EPS on $24.08 billion in revenues. This has been the best DJIA stock so far in 2012 even including the last two trading sessions. It is a bit more than just interesting that earnings estimates have ratcheted higher over the last ten days when estimates elsewhere have been cut so much in banking. The huge discount to book value is again likely to be less material than in years passed.

Morgan Stanley (NYSE: MS) is set to report on Thursday morning as well. Long gone is worrying about the relative book value and long gone is the comparison to Goldman Sachs. Estimates are for a loss at -$0.57 EPS and $5.57 billion in revenues.

Capital One Financial Corporation (NYSE: COF) is due to report earning on Thursday and this is the credit card bank “for the rest of America.” The earnings report could be wildly far off of estimates because the bank is in the process of acquisitions which could greatly skew the headline numbers. A fresh SEC filing showed that monthly data showed a continued improvement in default rates and in late payments in December. The consensus estimate is $1.55 EPS and $4.08 billion in sales.

JON C. OGG

Filed under: Banking, Brokerage Firms, Calendar, Earnings, Financial Stocks, The Week Tagged: AXP, BAC, BK, COF, GS, MS, NTRS, STT, USB

J.P. Morgan Preview, Huge Bank Sector Book Value Discounts On Deck (JPM, WFC, BAC, C, STT, BK, MS, GS, AXP, COF, FAS)

Administrator — Thu, 12 Jan 2012 15:30:12 +0000

J.P. Morgan Chase & Co. (NYSE: JPM) is about to report earnings Friday morning as the first bank and second DJIA component kicking off earnings season. We wanted to make a preview on Jamie Dimon’s company as well as to highlight some of the discounts to book value and other color on rival banks as they are all likely to react to Friday’s news.

We will be paying extra attention to the money center banks of Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), and Wells Fargo & Co. (NYSE: WFC); and then there are the “bankless bank holding companies” of Goldman Sachs Group Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS) to consider as rival trading outfits. Then there is also American Express Co. (NYSE: AXP) with much of the same client base as Chase Banks and then the more mainstream Capital One Financial Corporation (NYSE: COF) to consider as well. On the trust bank side and fiduciary side, there is Bank of New York Mellon Corporation (NYSE: BK) and State Street Corporation (NYSE: STT).

We have added in color on each group as well as shown trading ranges, implied price targets, and the implied discounts to the stated book values.

J.P. Morgan Chase & Co. (NYSE: JPM) is the best of the large diversified money center banks to most investors and it still trades at 0.76-times its stated book value. The stock is at $36.35, the 52-week range is $27.85 to $48.36, and the consensus analyst price target objective is $46.29. Thomson Reuters has estimates of $0.91 EPS and $23.05 billion in revenues for the quarter. Keep in mind that estimates have ticked lower almost each week during the last quarter.

Bank of America Corp. (NYSE: BAC) was recently listed as being at well under 0.5-times book value, but the stock has been the top performing DJIA stock. With shares at $6.87, the 52-week range is $4.92 to $15.31. The consensus target is $9.02.

Citigroup Inc. (NYSE: C) was recently about 0.52-times stated book value. Shares are trading around $31.27 with a 52-week range of $21.40 to $51.50 and the consensus price target is $41.98.

Wells Fargo & Co. (NYSE: WFC) was recently trading at 1.1-times book value, making Warren Buffett’s favorite bank stock the only of the money center banks not at a discount to its stated book value. That is partly because the new trading rules and regulations are believed to have the least impact on it out of the money center banks. Shares are trading around $29.62 with a 52-week range of $22.58 to $34.25 and the consensus price target is $32.37.

Goldman Sachs Group Inc. (NYSE: GS) trades at about 0.7-times its stated book value and some now expect a loss when it reports earnings. At $99.76, the 52-week range is $84.27 to $175.34 and the consensus price target is $128.80.

Morgan Stanley (NYSE: MS) trades at a steep discount even to Goldman Sachs with a price/book ratio of only about 0.52-times stated book. Shares trade at $17.10 and the 52-week trading range is $11.58 to $31.04. The consensus price target is currently about $21.80.

American Express Co. (NYSE: AXP) is not at a discount to book value at all at 3.19-times book value because it is classified in such a different manner. Shares are trading at $48.95, the 52-week range is $41.30 to $53.80, and the consensus price target is $56.63.

Capital One Financial Corporation (NYSE: COF) may not be accurate on book because of the acquisitions and changes there. It is stated as being 0.75-times its stated book value. Shares trade at $47.71, the 52-week range is $35.94 to $56.26, and the consensus price target is $56.85.

Bank of New York Mellon Corporation (NYSE: BK) trades at 0.77-times its stated book value at the custodial and fiduciary bank. Shares are at $21.50, the 52-week range is $17.10 to $32.50, and it has a price target of $25.33.

State Street Corporation (NYSE: STT) is at a premium of 1.08-times its stated book value for the custodial bank. State Street;s stock is at $43.05, its 52-week range is $29.86 to $50.26, and the consensus price target is $47.36.

Price-to-book and price-to-earnings data provided by Finviz.com, consensus price target (mean target) provided by Thomson Reuters.

Many estimates have been trimmed by analysts of late for the banks and financials. We still expect modest credit metric improvements in most of the big banks and more importantly expect improvements in customer credit metrics to have improved again. The difference this quarter is that there should be a tick up in loan demand actually being met by the banks, but don’t expect any huge gains there.

Before you get too excited about the discounts to book value, this may still be more of a ceiling rather than a floor. Cash may have to be paid out in settlements, carrying cash balances yields literally nothing, and many banking operations remain in a state of muted flux.

Lastly, look for this to impact the wild triple-leverage ETF of the Direxion Financial Bull 3X Shares (NYSE: FAS), but watch the tracking error when the markets are not open.

JON C. OGG

Filed under: Banking, Brokerage Firms, Earnings, Financial Stocks Tagged: AXP, BAC, BK, C, COF, FAS, GS, JPM, MS, STT, WFC

Media Digest (1/11/2012) Reuters, WSJ, NYT, FT, Bloomberg

247wallst — Wed, 11 Jan 2012 11:51:26 +0000

Dell (NASDAQ: DELL) to launch its first tablet PC late this year. (Reuters)

NYSE Euronext (NYSE: NYX) and Deutsche Boerse will try to save their merger with a case for EC regulators. (Reuters)

Fannie Mae’s CEO to depart. (Reuters)

New York State is examining the use of force-place insurance by Bank of America (NYSE: BAC) and other large financial firms. (Reuters)

Motorola (NYSE: MMI) and Lenovo will launch smartphones powered by Intel (NYSE: INTC). (Reuters)

Apple (NASDAQ: AAPL) will have substantial exhibits at the Consumer Electronics Show. (Reuters)

Kodak (NYSE: EK) sues Apple and HTC over patent infringements. (Reuters)

Some of Spain’s banks continue to make home loans despite an oversupply. (WSJ)

The Fed gives the U.S. Treasury $76.9 billion in profits. (WSJ)

Orange juice futures hit a record high. (WSJ)

Alpha Natural Resources (NYSE: ANR) reaches a settlement with miner families arising from an explosion in a Massey mine in 2010. (WSJ)

Egypt will ask the International Monetary Fund for money. (WSJ)

Fitch says that Italy is the largest risk to the euro. (WSJ)

The Hostess relationship with unions may determine whether it can stay out of bankruptcy. (WSJ)

The New Republic is for sale. (WSJ)

Tiffany’s (NYSE: TIF) sales stumble. (WSJ)

Google (NASDAQ: GOOG) launches a new product to tie search more closely to its social network. (WSJ)

The head of WebMD (NASDAQ: WBMD) departs. (WSJ)

Office owners hurt by expiring five-year leases. (WSJ)

Bank of NY Mellon (NYSE: BK) is close to settling on overcharging for currency trade cases. (WSJ)

Copper rises on demand from China. (WSJ)

Some Chinese exporters have such a large share of market that they cannot expand. (WSJ)

Investors add to positions in Greek bonds on the assumption of a bailout in March. (NYT)

Dividend increases are a sign of better corporate recoveries. (NYT)

India will again offer foreign retailers more access to its markets after reneging on an earlier arrangement. (NYT)

The head of Citigroup (NYSE: C) says banks should disclose more of the risk assessments of their assets. (FT)

Carlyle Group will list on the Nasdaq. (FT)

The battle between Intel and Qualcomm (NASDAQ: QCOM) over smartphone chips intensifies. (FT)

Microsoft (NASDAQ: MSFT) sues more Chinese companies over piracy. (FT)

Banks in the eurozone continue to cut lending despite European Central Bank attempts to change the practice. (Bloomberg)

State-funded pensions in Europe are $39 trillion short on money to fund obligations. (Bloomberg)

Germany’s economy contracts in Q4. (Bloomberg)

Microsoft says interruptions of parts supplies from Thailand will slow PC sales. (Bloomberg)

Douglas A. McIntyre

Filed under: Press Digest Tagged: AAPL, BAC, BK, C, DELL, EK, GOOG, INTC, MMI, MSFT, NYX, QCOM, TIF, WBMD