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Is Bank of America undervalued?
Two steps forward, one step back. That’s the analysis from senior equity analyst Jim Senegal at Morningstar Research on the large US banks. He says costs such as the cyber security budget are beginning to mount up.
Senegal also notes that with everyone paying back money, there isn't much loan growth. This is exacerbated by the fact that interest rates remain low.
But he says there is one bank that looks undervalued and that's Bank of America. He says most of the big legal costs have been paid and the core business is "doing very well". Senegal says Morningstar has raised its 'fair value' this quarter from USD 16 to USD 18 per share.
01:36 minutes
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