Bank stocks are clearly more attractive to value investors because of their book values.  The concern is their growth levels.

C-CITIGROUP INC-Selling at 42.47 they are at their 52 week low.   They have a 126b cap, and a .47% dividend. P/E is at 7.85.  Analysts are neutral/negative.  Their book is at 75.12 per share.  Earnings growth this year is at 4.55%.  Moving forward, growth is looking like 33%…right.  Book growth per share is at like 5.6.  Debt/equity is at like 98%.  Return on equity is at like 8%.  Compounded earnings growth rate is at like 2.76%.  Average return on equity is pretty fairly stated at about 4-5%.  If they were to grow at 5% per year, i’d buy em at 30.  If they were to grow at 8%, they’d be a good buy at 40.  I’ll put an alert down for 39.  Upon revision, maybe they pay 20cents a year in their dividend.   EPS are at like 5.41-less .2 is 5.21 per share in retained earnings.  It’s feasible that they have 153 in book per share in 10 years.  And so they’d be looking at earnings of 12.24 per share.  Plus another 1.75 per share in after tax dividend earnings.  With historically low multiples of 7.85, the stock could be worth 100 per share on that low multiple  which would be an 8.94 growth rate.  If we went with a p/e of 15 we’d be looking at our 15% growth rate.  I think its reasonable to have their price point at 39, but if we got down to 35, we’d be in great shape.

WFC- WELLS FARGO AND COMPANY-Selling at 48.82 just above their 52 week low of 47.75.  The stock is down over the last 52 weeks.  Cap is 249.36b.  Dividend is at 3.07.  P/E is 11.76.  Analysts are high neutral.  Book per share is at 37.93.  Growth going forward is a reasonable 9.59 per share. Past five years its been at 13.43.  This coming year expected to come in at 6.51.  Book growth per share is at like 7.79.  Return on equity is at like 12.65.  Debt to equity is at like 110%. Growth rate of earnings  is at like 5.84.  Historical return on equity is like 10+ on average.  I think they are a bit more consistent, maybe a bit better managed than Citigroup.  They cost too much I think.  I’m not going to get the kind of earnings i want from this bank, unless they really come down to like 25.  And they aren’t gonna fall by that much.  They have the dividend, so they are priced high.  Upon revision, EPS is at 4.15 and they  pay a dividend of about 1.5 per share.  So over 10 years, I might get after tax dividends of about 14 per share.  If we go with 66% of that averge return on equity figure of 11~, we’re looking at bookin 10 years of about 74.61, so earnigs of maybe 8.2 per share plus dividends of 14.  With a p/e of 11.76 maybe a price of 96.43 plus after tax dividends of 14.  We’re looking at a growth rate of 8.46%.  If we broght he price down to 35, the rate is at 12.13.  At these p/e’s we’d need the price to come down to 27 for our 15% return.  If we say a p/e of 15, we’d need the price to come down to like 33 per share.

FITB-FIFTH THIRD BANCORP-is near their 52 week low of 16.75, currently trading at 17.12. They have a cap of 13.6.  They pay a 3% dividend.  P/E is 10.31.  Analysts are very bullish.   Book per share is at 19.9.  Forward growth is expected to be in the 4.89 range.  This coming year is at 4.22.  They are coming off of negative earnings growth.  Book value growth over the past 5 years has been at 7.65%. Return on equity is like 9.49.  Long term debt to equity is at about 100%.  Earnings growth is kinda lame, spotty over the past 10 years for sure.  I think I can justify buying them at about 8-9.  Their growth kinda sucks.  Never know what they have in the works…I’ll do more due diligence if they come down to a better price.  Upon review, EPS is about 1.66.  Dividend is at about .52 per year.  So after 10 years maybe we’d have a dividend of 4.55 after tax, and maybe we’d be looking at a book of like 35.64.  And maybe EPS of like 3.564 if we went with the current P/E of about 10 we’d be looking at a share price of about 35.64 maybe as high at 53.46 plus after tax dividends of 4.55.  With current p/e and price, we’d be looking at a rate of 9.09.  With the higher p/e we’d be looking at a 12.31 rate of return.  Problem with this bank is that it’s not protected by a brand name or a moat.  I’ll put 10 as a price point, but I’d really need to get lower than that for safety.

MA-MASTERCARD INCORPORATED-selling at 88.71, well above their 74.61 52 week low.  They’ve gained 7.86% on the year.  P/E is at 27.3. Short interest doesn’t exist  Dividend is at .86%.  Analysts are neutral.  Cap is at 99.6b.  Book per share is at 5.57 per share.  Book growth over last 5 is at 14.15.  Future earnings are expected to grow at 16.26%.  Return on equity is at 57.74.  Debt to equity is at 23.86.  Earnings growth is good lately, but they’ve been a bit down since some funny business in 2010-2011.  Return on equity is always historically very high.  They, of course, don’t need all that capital to build facilities or whatever…it’s all salaries and profit.  I can’t really justify purchasing these guys unless they come way down.  I’d buy em at 45.  And there is a speculative element there.  Upon review, EPS is about 3.25.  Dividend is at about .76c, about 23% of earnings.  So after 10 years, maybe I could expect 5.95 in after tax dividends.  Plus, book value of maybe 35 per share…conservatively calculated.  Going with a conservative p/e of 15, they could be worth 131.25 per share plus that  5.95….we’re looking at 4.44% growth.  If we went with the crazy high P/E of 27.3, we’re looking at 162.43 per share, plus that 5.95 for a return of 6.59.  Now to be fair here, I did use a more conservative average of about 25 ongoing return on equity.  I agree with my price point of 45…even that is pretty high.  This company could face headwinds when other means of processing payment come around.

MS-MORGAN STANLEY-selling at 25.97.  They are near their 52 week low.  They have a P/E of 16.23.  They have a 2.31% dividend.  There’s a .59% short interest.  And they have a cap of 50.28b.  Analysts are very negative.  Book per share is at 38.85.  Earnings growth this past year sucked…negative 36.25.  Forward they are looking at 15.66 per year. Book value growth per share is at 11.83%.  Return on equity is at 4.78.  Long term debt to equity is at 199%.  Earnings are pretty shitty.   Historical return on equity is sorta shitty and spotty.  I’d give them an average of 5…and that’s generous.  I think they are overpriced.  I’d pay 15.64 on the low side.  Splitting the difference between historical return on growth and return on equity of this year…so 9, I’d buy em at about 19.  EPS is at about 1.6.  And they pay a dividend of about .6 per year about 37.5%.  Maybe we’d be looking at an after tax dividend of 12.84.  Book could very well grow to 53.91, and with a return on equity of 5 we could be looking at a share price of 40.43 plus after tax dividends of 12.84, we’re looking at a 5.29% growth rate.  Lame.  I’d pay 11, this is a downward revision.  Never know they could actually start generating returns…but who knows.

GS-GOLDMAN SACHS-selling at 155.61.  They are pretty much at their 52 week low.  Cap is at 66%.  Short interest is at 1.31.  Dividend is at 1.67.  P/E is at 10.24.  Dividend is at 1.67%.  Analysts are neutral/negative.  Book is at 196/share.  Earnings growth are terrible over last few years.  But things are looking ok this year, and in the next 3-5 with 24% and 6% respectively.  Book growth per share is about 2.91.  Return on equity is 9.29.  Debt to equity is 237%.   Looks like they are getting back to ok on the earnings but they are spotty.  Historical return on equity is pretty high.  Assuming 5% growth, I can justify purchsing them at about 80.  I don’t know about these guys.  EPS is pretty much 15.19.  Dividend is 2.6, about 17%.  So after tax dividends in 10 are like 22.18.   Book could very well be in the 423 range…conservatively.  So we’re looking at EPS of 42.3, and with a p/e of 10: we’re looking at a share price of 423 plus after tax dividends of 22.18.  We’re looking at a halfway decent growth rate here of 11.08.  If I could get em at 110, I’d have a great rate of return at present p/e levels.  If p/e went up to 15, they are a buy right now.  They have a nasty debt level.   I’ll revise them upwards to 145, with additional price points of 135,125, and 115.

LUK-LEUCADIA NATIONAL CORP-Selling at 15.74/share.  They are near their 52 week low of 15.2.  They have a 2% short interst.  They also have a 1.59 dividend.  Analysts are very bullish.  Cap is at 5.7.  Book is 28.96 per share.  Earnings have been down lately.  Earnings this coming year are looking to be like 48% higher.  Book value growth is at 18% per year.  Return on equity is at 2%.  They have 75% debt to equity.  Their earnings have been sorta spotty, but why?  Historical return on equity was good, but is now sucking big time.  Weird.  P/E is at 28.62.  If they come down to 12.  Read a bunch of blogs on seeking alpha…it’s a value play.  Upon review, allowing their book price to stay there, but keeping their return on equity at 5, EPS is like .55.  They pay a dividedd of like .24 per share.  After tax dividends might be in the 2.10 range after taxes.  Book could very well be in the 42.87 range.  I could see their earnings being in the 1.53 range, and at current inflated p/e levels that would put their price at 43.81 plus that 2.1.  I think a more reasonable p.e is 15, and that would put their price at an uninspiring 22.95 plus that 2.1.  Wow people really are buying this stock on the hope of future earnings, which is pretty reasonable.   With the high p/e we’re looking at a return of 11.32.  On the low end, we’re looking at 5% growth.  I’ll keep the price point of 12.

BAC-BANK OF AMERICA CORPORATION-Selling at 14.46, they are pretty much at their 52 week low.  Short interst is at .68%.  Cap is at 150.56b.  Dividend yield is at 1.38%.  P/E is at 10.79.  Analysts are very neutral. Book is 24.54 per share.  Earnings growth next 3-5 is 9.  This year 13.5.  This finally got going for bank of america this past year after the recession.  Return on equity is at 6.  Debt to equity is at 101.  Earnings are looking ok now after being in hell for a long time.  I could call return on equity an average of 5.  I’d buy them at 10.86, using a 6 percent growth figure on my book value.  Upon review, earnings are at 1.34 per share.  Dividend is at like .2 per share.  After tax dividends are at like 1.75.  Book may very well be in the 40 per share range…conservatively.  So earnings could very well be in the 2.4 range.  That would put our price at 24 on the low range and 36 on the high end of valuations…conservatively speaking.  That would put our growth rate at 6% on the low end and 9.55 on the high end.  I’ll leave that 10.86 price point, but I think they would be a safer buy at 9.  Conservative but safe.