Bank of America WS B and Gold Consolidation

March 12, 2017 Bank of America WS B and Gold Consolidation Good Sunday Morning, I frequently talk about of the resource sector in my writings and my weekly audios, however, there is another world of warrants trading in all of the other sectors. Some of my subscribers are only interested in the non-resource shares and stock warrants and there are many opportunities, from banking, pharmaceuticals, bio-techs, restaurants, etc. Today before I discuss the resource markets, let’s take a look at the amazing rise in the price of the shares of Bank of America but more specifically the rise in the price of the WS.B in just a few months. With the election of Donald Trump as President and the view or likelihood of the relaxation of banking rules and regulations, the shares shot up from a recent low of $12.05 to a high last week of $25.80, a gain of 114%. However, the real action has been in the WS.B trading on the NYSE, going from a low of $0.0626 to $1.55, a potential gain of 2,376%. The leverage was and continues to be amazing with the WS.B outperforming the shares by a leverage of 20.8 to 1. My Message? Don’t overlook the other markets where monster gains can also be made with warrants. Resource Sector: The consolidation continues as gold and silver hit recent lows are Friday morning before coming back slightly to close up on the day at $1204.50 (up $3.70), $17.02 (up .07), respectively. There is a slight chance that on a … Continue reading

How Warren Buffett Wins From Bank of America’s Capital Plan

By Jordan Wathen March 19, 2015 Warren Buffett has a sizable stake in Bank of America (NYSE: BAC  ) , even if it’s hidden from plain view. Berkshire Hathaway (NYSE: BRK-A  ) (NYSE: BRK-B  ) owns warrants that entitle it to purchase 700 million Bank of America shares for $7.14 each at any time before 2021. At the current price, it’s as if Berkshire has an $11.2 billion stake in Bank of America, making it one of Buffett’s largest investments. Owning warrants is not exactly like owning stock, however. Because Buffett hasn’t exercised his right to buy the shares, Berkshire Hathaway isn’t entitled to any dividends Bank of America pays on its common stock. In fact, every time Bank of America pays its quarterly dividend of $0.05 per share, Buffett gives up a little bit of a return. Berkshire Hathaway is missing out on $140 million in annual dividends by holding on to the warrants. Buffett contends this is a good play for Berkshire Hathaway. Exercising the warrants would require the company to hand over nearly $5 billion in cash to Bank of America in exchange for the 700 million shares. Berkshire could part with the $5 billion and start collecting $140 million in dividends — a yield of about 2.8% on the cash outlay — but Buffett isn’t budging. He has said on numerous occasions that he likes the warrants as they are, and he intends to hold them until expiration in 2021, unless Bank of America starts paying out a really big, really tempting, dividend on the common stock. … Continue reading