Morgan Stanley Overweight On Bank of America (BAC)

Morgan Stanley continues to be Overweight on shares of Bank of America BAC after the Charlotte-based bank reported earnings this morning. It has a $22 price target on shares. In a note to clients, Morgan Stanley writes, "Impact on our views: 1c miss on higher mortgage cleanup expenses. Shows BAC is taking action to cut its tail risk. Yes, we expect this will continue throughout 2011. And, as BAC chews through its mortgage cleanup, and the mortgage business breaks even, BAC's ROE will lift 2% points. That plus improving mortgage efficiencies and lower credit costs in other parts of its business get it another 2% points to 10% ROE by year-end 2012. Earn your cost of capital and you are worth 1x book which is the basis for our $22 pt." Shares of BAC are down 5 cents to $13.08, a loss of 0.38% so far this morning.