Topic: Growth Stocks

The Wall Street Stock Forecaster Hotline – Friday, January 16, 2009

Article Excerpt

BANK OF AMERICA CORP. $7.18, New York symbol BAC, moved down this week as losses from recently acquired brokerage firm Merrill Lynch & Co. were higher than originally anticipated. In the fourth quarter of 2008, Merrill lost $15.3 billion due to writedowns of securities backed by mortgages and other loans. Bank of America completed its $19 billion all-stock purchase of Merrill on January 1, 2009. Fears over rising loan losses also weighed on Bank of America. In 2008, Bank of America’s earnings fell 73.3%, to $4.0 billion or $0.55 a share from $15.0 billion or $3.30 a share in 2007. The drop was mostly because of an $18.4 billion rise in loan loss provisions. These earnings figures do not include Merrill Lynch. The U.S. Treasury has now agreed to buy $20 billion of new preferred shares from Bank of America. These new shares carry an annual dividend of 8%. In 2008, Bank of America sold $25 billion of preferred shares (5% dividend)…