Benj Gallander is president of Contra The Heard Investment Letter.
Bank of America
BAC continues to deal with many issues that have hammered results over the last few years and caused many to question the company's survival. However, the recent quarterly profit was $2.5-billion and the Tier 1 Common Capital Ratio hit a record. It would not surprise to see the current dividend more than double over the next couple of years.
Management has ably operated this outfit not only through the difficulties of the recession but during a period where newspapers have been having tremendous difficulties with the transition to digital. Over the past few years, the debt has decreased and the dividend grown. Excellent upside potential.
ATS has turned the page on its turnaround and is now moving into a growth phase. A takeover or two is likely. The quarterly results this week were excellent with revenues up 20 per cent and earnings from continuing operations up 45 per cent. The backlog is at a record level. A triple from this level is not out of the question.
Past Picks: Aug. 25, 2011
Total return: +41.56%
Total return: %
Bank of Commerce Holdings
Total return: +27.21%
Total Return Average: +32.29%
Predicting where markets go in the near term is beyond tricky. The number of wild cards that can create volatility in both positive and negative ways is far greater than normal. The best an investor can do is attempt to ignore the noise that is fervent these days and be extremely disciplined when investing.
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