Kelly King has said that he might raise the dividend in the fourth quarter of 2010 or the first quarter of 2011. How much?? You guys who love BB&T tell me why I should buy. IT IS NOT FOR THE DIVIDEND FOR SURE!
I like BBT, think they are one of the best (maybe even the best) of the larger banks. That said let's look at some numbers. BBT is trading at a PE of 32 (ttm).
With the estimated earnings growth maybe they would be at a 15 PE by mid 2011 - which is a more nomal PE for a bank (banks often trade at even lower PES that that).
If banks get hit with a slew of defaults on Alt-A, interest only and other exotic mortgages this fall as these mortgages reset (peak resets expected to exceed sub-prime) then banks will get hit. Now admittedly BBT was not into underwriting these types of mortgages, but if other banks get taken down so will BBT.
Given this I believe BBT is richly priced above $30 (even over priced).
BBT made money when others lost billions, they picked up assets on the cheap last year, they still pay a dividend and will increase it again. The stock is beat up from a lousy market. The company is well run and lots of growth in the future. I'm more worried about the markets than BBT. In fact if Obama ran the country like Kelly King we would be just fine.