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Friday, September 12, 2008
Bove: Bank Of America Will Win Lehman Auction
John Spence
MarketWatch Pulse
BOSTON -- Ladenburg Thalmann analyst Richard Bove in a research note Friday wrote that Bank of America Corp. (BAC) will win the auction for Lehman Brothers (LEH), arguing there is a "natural fit" between the two firms.
"Lehman needs Bank of America to lower its borrowing costs. It also needs the bank to portfolio its commercial real estate loans," the analyst wrote.
Bove said a Lehman deal would be a "major plus" for Bank of America that would boost its presence in fixed-income, investment banking and management, research and other areas. He has buy ratings on both Bank of America and Lehman.
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FOX Translator
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Cost basis is the cost at which you entered a position or purchased an asset. It is the total price you paid for, say, your house, a stock, mutual fund, etc...--and by total we mean including all commissions, accrued interests and other expenses. Cost basis is used to determine tax liabilities.
For example, if you bought 100 shares of IBM at $111.45, and IBM is now worth $120 a share, the current value of the position is $12,000, but the cost basis is $11,145.
Do the math and you'll see this would give you a profit of $855, so, Uncle Sam's piece would be based on that.
