Today's job report was not nearly as weak as it looks. CES Birth/Death Adjustments were -233,000 for January.
2016 Net Birth/Death Adjustment, not seasonally adjusted (in thousands)
CES Series Code Supersector Jan
Mining and logging
Trade, transportation, and utilities
Transportation and warehousing
Professional and business services
Education and health services
Leisure and hospitality
As per CC, the total loans to China, mostly through US based companies is $10.4 Billion.
'As an example, if we held oil prices at $30 per barrel for nine quarters we estimate our potential losses on the energy portfolio would be roughly $700 million. In energy and across our commercial sector we continue to support clients while managing lending limits and actively engaging with stressed borrowers ' IT IS IMPORTANT TO NOTE THAT OIL HAS ONLY DIPPED UNDER $30 FOR 4 DAYS IN 2016 (no days in 2015) and HAS ONLY BEEN UNDER $40 SINCE DECEMBER 10, 2015. (going above $40 several times after).
Within that $21 billion, $8.3 billion or less than 1% of total loans is loans to borrowers in two subsectors, "...exploration and production as well as oilfield services. We consider these two subsectors to have significantly higher risk than the rest of the energy portfolio.
Of our $8.3 billion utilized exposure to these two higher risk subsectors $2.9 billion has already been downgraded to criticized. So 35% of the higher risk subsectors has already been downgraded to reservable criticized exposure, thereby driving a portion of the reserves. And allowances for loan losses for the entire energy portfolio is approximately $500 million, or 6% of the funded exposure of these two subsectors.
Companies in the vertically integrated subsector represent $5.8 billion of the energy portfolio. We believe this subsector has a better ability to withstand lower oil prices. Nearly 100% of the companies have a market cap of $10 billion or more or they are sovereign owned and the average company has a market cap greater than $60 billion.
We believe the remaining exposure in refining and marketing as well as other is also less dependent on oil prices. As part of our standard risk management process we stress test our credit portfolios including our pension portfolio. Our stress analysis of the energy portfolio includes various sustained low oil prices over extended periods.
As an example, if we held oil prices at $30 per barrel for nine quarters we estimate our potential losses on the energy portfolio would be roughly $700 million. In energy and across our commercial sector we continue to support clients while managing lending limits and actively engaging with stressed borrowers. "
Analyst Target Update: Bank of America Corporation (NYSE:BAC)
JAN 25, 2016 Markets Staff
Wall Street brokerage firms that regularly track Bank of America Corporation (NYSE:BAC) have released a consensus price target on its stock. As per these firms, the price target is set at of $18.375, aggressive target at $20 and the conservative target price is stated as $15.
Zacks Groups surveyed several analysts to compute the consensus target price. These research firms expect this quarter’s earnings for the current period to come at $0.3. The recent updates given by the company confirms that it intends to post quarterly earnings on or around 2016-04-20. The company reported quarterly earnings of $0.28 per share for the period ended 2015-12-31.
Smart shorts will cover tomorrow. They can't afford to risk a statement from the Fed that sends the market on a rocket blast off. There's a ton of shorts here - get ready for takeoff.
16:13 $ 12.96 1,259,000
16:13 $ 12.96 151,110
16:13 $ 12.96 26,090
16:13 $ 12.96 16,640
16:13 $ 12.96 6,398
16:12 $ 13.1245 128,700
16:12 $ 13.11 493,314
16:11 $ 13.025 355,100
16:11 $ 13.025 103,600
As you said, they don't have near the exposure as other financials. Yet BAC is down 3 times what the financial sector etf, XLF is today and there is heavy buying taking place in BAC. They drove it down to buy cheap.
LOL Ha, Ha ha! Less than 2% of total loans. Even if 15% went bad - which would be ultra-extreme - it would be less than 1/3 of 1%. Better cover while you can.
By Abdul Wasay on Jan 25, 2016 at 11:42 am EST Bidness Etc looks at the possibility of a hike, and the potential increase bank earnings. We take a closer look at Bank of America, the bank that poses an attractive buying opportunity, irrespective of the hike. Bank of America Corp (NYSE:BAC) is one of the top beneficiaries among large cap banks in the US. These banks have high asset sensitivity and excess deposits, that were invested in yields when rates were low. Soon after the Federal Reserve raised rates in December, these banks raised their prime lending rates by 25 basis points (bps) Bank of America
Amid the increase in volatility and uncertainty in markets, bank stocks have been hammered alongside the overall index. Most big bank stocks carved fresh lows in recent trading. In light of this sell-off, investors have pulled out of the stock market, especially so following uncertainty from China. But on the flip side, bank stocks including Bank of America trade at a cheap price, posing an attractive buying opportunity.
Bidness Etc believes Bank of America holds significant upside potential considering the discount on its share price. According to the bank’s recent earnings release (4QFY15), its book value is $22.54. Additionally, the last closing price of $13.56 suggests the stock trades at a discount of almost 40%. Its price-to-book value ratio is 0.6x. At this time, most of Bank of America peers trade near 1.0x book value. Additionally, its return on average common stockholders’ equity improved to 5.1% in 4QFY15, as opposed to 4.8% in 4QFY14.
As for the recent earnings release, the bank was able to post record annual profits in 2015. Bank of America’s profits for the 3-month period ending December 31, 2015 saw an increase of 10%, while it set aside $334 million in provision reserves for potential losses on its loans. The bank has been able to surpass analyst estimate
The specialist is accumulating many shares and will post at end of day or afterhours. Someone big is buying heavily. The volume is not changing in sync with the transactions. I've seen this many times before and it means only 1 thing. They will run this up afterwards. They drove this down to scoop up shares for this fund. If you're not buying here, you're crazy.
You might want to go look at a chart. BAC did the same 50/200 DMA crossover in early October and the stock climbed from 15.50 to 18.00 right afterwards!
This is down more than twice the xlf today, yet BAC has less exposure in oil than the other banks. The price movement is not rational so you have to buy.
On the earnings call CFO, Paul Donofrio, noted that the company has $21.3 billion in loans with energy-related exposure. This represents approximately 2% of its total loan portfolio. Even if 15% of these loans would default (which would be extreme), it is less than one-third of 1% of loans. I now think the stock is underpriced here.