marginally safe bet More than a year ago, Hudson City Bancorp (Nasdaq: HCBK ) proved me wrong. Then again, a few months ago, I switched course and warned investors to avoid the stock, which now appears to have been a good call. Well, I'm once again going to do my best NFL referee impression and flip my stance back to optimistic.
Despite reporting a 33% drop in income in its latest quarterly results, Hudson City had plenty of positives built into its report. The bank's loan loss provision dropped to $30 million from $50 million and net margin interest ticked slightly higher to 2.14% from 2.13% a year earlier. While I'd hardly call Hudson City's business booming, it is stabilizing, and the prospects for the company turning a profit in 2012 look very good. Not to mention that the company is currently yielding a handsome 5.5% even after a recent dividend haircut. Bank of America (NYSE: BAC ) and Citigroup (NYSE: C ) may trade more cheaply to book value, but it's very hard to overlook Hudson City, which is at 57% of book value while yielding 5.5%.