Bank Of America (BAC): Very Dangerous Rating — for Ask Matt Readers

Bank Of America (BAC) gets our Very Dangerous rating because it has misleading earnings and a very expensive valuation. Here is my free report on BAC.

My free stock screener delivers my quality-of-earnings and valuation ratings on 3000+ stocks.

Here is a quick preview of my recent articles Sell BAC: Management Is Running Out of Gimmicks and “Raising Fees Is a Desperate Measure“.

BAC’s reported earnings are misleading in 2011 because they are positive and rising while the economic earnings are negative and declining. Much of the difference between the accounting and economic earnings comes from the $7.2 billion draw down in the firm’s loan loss reserves.

My regular readers know that I am bearish on the financial sector as it ranked last out of all sectors as detailed in our sec­tor roadmap.

My rat­ings and free reports (updated daily) on all funds in this sec­tor are available from my free fund screener.