Bank of America Will Emerge a Healthy Survivor, Reiterate Neutral

4/22 - "The nation’s largest retail bank saw its net profit fall 77% and its earnings per share were $.23 -- a significant disappointment from consensus estimates of $.41 per share. Bank of America CEO Ken Lewis blamed $1.3 billion in trading losses and the need to increase reserves for potential charge-offs of bad loans...BofA does have some options when it comes to shoring up its balance sheet and--when compared to other investment banks--BofA’s overall risk exposure to the credit markets is fairly modest."

"Bank of America’s results do not greatly concern us as they are relatively unremarkable in comparison to the rest of this distressed sector and it seems curious that the market interpreted BofA’s news negatively. Recall, last week Citigroup announced another huge write down and cut 9000 more jobs and that stock rallied. It certainly appears that Bank of Amer...