The Moneygardener submits:
It was nice to see my adjusted cost base plummet today as I quadrupled my stake in Bank of America (BAC). The stock is trading around $14.25 per share. The dividend was all but wiped out during the financial crisis but I believe that it will come back with a vengeance over time.
Bank of America is very well positioned to reap the benefits of a slow US economic recovery, which is probably in the works. The risk/reward on Bank of America trading at these levels seems very attractive as they own several valuable franchises, have great market share in US deposits, and have paid back their TARP funds. The bank is currently trading at a multiple on around $1.00/share of earnings, which I believe has the potential to expand to $2 without much trouble. This would put the stock price easily into the $20s, which is a signficant jump from here.