Analysts Cut ’08 Estimates for B of A

0

Several analysts, including Punk Zeigel’s Richard Bove and Oppenheimer analyst Meredith Whitney, cut their 2008 earnings estimates on Bank of America Corp (BAC.N: Quote, Profile, Research) on fears of higher credit costs and loan loss provisions, after the largest U.S. retail bank posted a 77 percent drop in first-quarter profit, Reuters reports.


“As declining housing prices continue to weigh on all aspects of the economy, deteriorating credit quality is reverberating through bank earnings as provisions and charge-offs rise,” Whitney said in a research note to clients.


On Monday, Bank of America said it expects earnings this year to take an “upward trajectory,” even as it posted weak quarterly results, adding that it would not change its “dividend philosophy” but could review it if the environment got “noticeably worse.”


Punk Ziegel’s Bove, who rates the stock a “buy,” said the bank’s margins, loans and net interest income were rising at above average rates, adding that it was well capitalized, very liquid and its dividend appeared to be safe.



Read the full Reuters story

.

No posts to display