Bank of America: peak returns on equity is a poor entry point
Quality is not in dispute. The price assumes the current return on equity is the through-cycle number, and it is not.
Evidence · 4 cards
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Discussion · 4
Agree with the direction, less with the magnitude. Second source in a constrained market is genuinely underrated. Curious whether you would still size it the same at a higher entry.
Reasonable, and I have thought about it a lot. That is the objection in the steelman card. My answer is that the supply response is slower this time, which changes the timing rather than the direction.
Been long since the last one. The comp table did more work for me than the narrative did. Has anything in the last print changed the entry you would take?
Strong piece, one objection. The comp table did more work for me than the narrative did. What does the bear actually have to be right about?