Why Bank of America Shares Are Soaring

The following video is part of our "Motley Fool Conversations" series, in which senior analyst Anand Chokkavelu, CFA, discusses topics around the investing world.

Bank of America got pretty good news from the recent Federal Reserve stress tests. Its stressed-out numbers under an economic-meltdown scenario were acceptable and in line with its peers. And unlike Citigroup, it was smart enough not to try to request a boost in dividends or share buybacks, as it has tried in the past. This news isn't earth-shattering, but because B of A has been so beaten down, its shares respond extra favorably to good news. Anand explains.

The financial heavies are getting a lot of press these days, and much of it is negative. But there's one small bank that's flying under the radar, and it has some of the best operational numbers you'll ever see. The Motley Fool featured it in its brand-new free report: "The Stocks Only the Smartest Investors Are Buying." We invite you to download a free copy. To find out the name of the bank Warren Buffett would probably be interested in if he could still invest in small banks, just click here.

At the time thisarticle was published Anand Chokkavelu, CFA, and The Motley Fool owns shares of Bank of America and Citigroup. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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