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BAC and BAC WS A: Much Cheaper Than WFC?

October 29, 2012 | About:
Alejandro Vazqu

Alejandro Vazqu

5 followers
BAC: $9.12 per share (market cap: $98.29 billion)

BAC WS A: $3.63

As the research was too long, I uploaded it to Scribd.

Disclosure: Long BAC WS A.

BAC and BAC WS A: Much cheaper than WFC?



About the author:

Alejandro Vazqu
I am an individual investor who concentrates on his best ideas. I have worked in one of the big investment banks in its fixed income division and I am currently an entrepreneur.

Rating: 4.4/5 (49 votes)

Comments

johnheiderscheit
Johnheiderscheit - 1 year ago


I am NOT an expert in bank valuation, that is for sure. But I needed some exposure for portfolio construction targets. I bought the A warrants at $3.60 and expect to generate 50 cents per year selling way out of the money naked calls on BAC common. I like the fact that the warrants are pricing in very low volatility and interest rates at this price. Even if I take an occassional loss on the short call position I think I can have my basis in the warrants down to $1-$2 on expiration so the risk reward is maybe $2 down and $15-20 up. This approach is NOT margin efficient, however.
clemo69
Clemo69 premium member - 1 year ago
Good Analysis. Thanks!
supratik
Supratik - 1 year ago
Excellent analysis, thanks.
guruburu
Guruburu - 1 year ago
good work. its "BUFFETT", not "Buffet"

guruburu
Guruburu - 1 year ago
good work. its "BUFFETT", not "Buffet"

guruburu
Guruburu - 1 year ago
Nico,

Only reason the other analysis makes more sense to you is probably that you wrote it. Please keep your day job.

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