Market Overview

CLSA Analyst Sees Bank Stocks Gaining 50% Over Next 3 Years

Share:
Related BAC
8 Takeaways From Warren Buffett's Annual Letter To Berkshire Shareholders
Cramer Advises His Viewers On Fluor, Bank of America, MGM Resorts And Jack In The Box
Tracking Allan Mecham's Arlington Value Capital Portfolio - Q4 2016 Update (Seeking Alpha)
Related C
Is The Rally In Bank Stocks Over?
Fast Money Traders Share Their Profit-Taking Candidates
Wells Fargo: Outperformer In The Long Run (Seeking Alpha)

Bank stocks are expected to gain 50 percent over the next three years, at least according to CLSA's bank analyst Mike Mayo.

Speaking as a guest on CNBC, the analyst doesn't believe bank stocks have moved ahead of themselves in the recent stock market surge.

Mayo justified his bullish stance by highlighting President-elect Donald Trump's economic policies, which will support jobs and GDP growth. He added that a vital component of accelerating jobs and GDP growth is counting banks as a key partner.

Mayo said Trump's administration is expected to help banks in the regulatory environment, not necessarily be removing regulations by stop piling on new ones.

"The most important point - even if you don't get a 'Trump-bump' to the banks, and we think a 'Trump-bump' can add 20 percent to bank earnings, even without that we still think that banks create value for the first time in a decade," Mayo said. "Banks in the U.S. earn their cost of capital and that is what the market is collectively missing."

Here are Mayo's stock ratings and price targets:

  • Bank of America Corp (NYSE: BAC) - Outperform rating, $27 price target.
  • Wells Fargo & Co (NYSE: WFC) - Outperform rating, $64 price target.
  • Goldman Sachs Group Inc (NYSE: GS) - Outperform rating, $275 price target.
  • Morgan Stanley (NYSE: MS) - Buy rating, $54 price target.
  • Citigroup Inc (NYSE: C) - Buy rating, $80 price target.
  • JPMorgan Chase & Co. (NYSE: JPM) - Buy rating, $102 price target.

Latest Ratings for BAC

DateFirmActionFromTo
Feb 2017MacquarieUpgradesNeutralOutperform
Jan 2017Societe GeneraleUpgradesHoldBuy
Jan 2017UBSDowngradesBuyNeutral

View More Analyst Ratings for BAC
View the Latest Analyst Ratings

Posted-In: bank stocks CLSAAnalyst Color CNBC Long Ideas Analyst Ratings Media Trading Ideas

 

Related Articles (BAC + C)

View Comments and Join the Discussion!