Fairholme Capital Management’s Bruce Berkowtiz still likes Bank of America even though the stock hammered his fund’s returns in 2011.The fund manager recently released a so-called “case study” on the Charlotte, North Carolina-based bank as to why it’s a good investment. [via ValueWalk]
Basically, his argument is that the stock is still trading well-below book value and the bank will start to see “incredible earnings power” thanks to reductions in risks and expenses as part of Project “New BAC”
As of December 31, 2011, Fairholme had more than 104.1 million shares in BofA, according to Bloomberg Data citing a 13F regulatory filing. Berkowitz started building his stake in Bank of America more than a year after it acquired Countrywide Financial in 2008.
Bank of America’s stock is up more than 57% YTD.