Beaten-Up Banks Can Be Bargains
Banks are the group everyone loves to hate right now. So far this year, they have been getting beat on like Joe Frazier in the "Thrilla in Manila." In addition to the ongoing loan loss issues, they now have to deal with a harsh regulatory environment and the Fed's Operation Twist, which promises to squeeze interest rate margins. As unpopular as the sector has been, when I look at the technical charts (don't tell the other value guys. I might get kicked out of the club!), it appears that they could well go lower before they find support and begin to work higher, as the levels seen at previous major banks stock bottoms have not been reached. In spite of the potential weakness, I am always looking for cheap bank stocks because I believe they will be long-term investments that offer tremendous returns for patient investors.
Given the recent selloff in the group, I decided to look back at the second-quarter 13HF filings. I looked for bank stocks that had been purchased by some of the world's best value and distressed managers that might be on sale at current levels and worth investigating. I found a few banks that are owned by successful investors that seem to have extraordinary long term potential....401 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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