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U.S. Bancorp Message Board

  • dangonegolfing dangonegolfing Jan 5, 2011 10:16 AM Flag

    What Gives on Stock Price

    Since the beginning of the 2011 new year, USB stock price has been going down each day, but most other Bank's stock prices have been going up, including the overall Bank stock index. This is against the grain. What gives?? What does the street know that the average investor doesn't know?? Can someone put an explanation spin on this??

    Dangonegolfing

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    • Cincy, you were correct, 1 star did not show up on one computer. Good catch! Billy you are the bogey man!

    • Check your ratings; you may only be showing folks more than one star rated...Billion usually is one star, for obvious reasons.

    • Great topic.

      I have a belief that we should not compare USB with the 4 largest banks because of all the derivatives they hold. And only one WFC is a regional while the other three are international.

      Last quarter Wells mortgage servicing rights was hedged ineffectively. This was astonishing to myself in that its MSR lost more value than its hedge made up for.

      I dont know exactly how WFC is positioned during the past quarter, but the counterparties on wallstreet might.

      Wells holds derivatives on currencies, treasuries, etc etc. Wells says they never speculate, however sometimes they are less than fully hedged versus other times they are fully hedged.

      Last quarter as rates dropped they had a bad month, perhaps this quarter as the yield curve steepend they'll have a great month. Who knows?

      My point is that USB is a different animal with much smoother revenues. You have no fear of suprises like the bigger brethren.

      The 50 AG will announce soon that they won and go home, USB couldnt care less because they did not suffer from the robosigning issue like Wells.

      Investment banking probably did ok.
      Wells equity trading probably did ok.
      Wells MSR hedge can easily add a billion to its bottom line in any given quarter.

    • wouldski4food@rocketmail.com wouldski4food Jan 5, 2011 5:32 PM Flag

      My only thought is since B of A settle their mortgage liability to FNMA/FHLMC and others such as WFC and JPM may have similar exposure where USB did not. That was holding back banks with mortgage liability exposure.

      Sure a big divergence of say USB and WFC prices since Monday and that's the only public news I have heard.

 
USB
40.27+0.89(+2.26%)Oct 21 4:01 PMEDT

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