Doug Kass is a Believer in the Big Banks on Rebounding Real Estate

By on April 17, 2012

Doug Kass - April 2012Citing housing affordability and pent-up demand, Doug Kass told CNBC’s Maria Caruso Cabrera he would put money in the big banks with large real estate exposure.

Kass mentioned there had been a decisive positive turn in the jobs market, mortgage rates are at generational lows, and housing surveys are improving along with consumer confidence.

Kass expects interest rates to rise as the economy achieves a self-sustaining recovery; good for the banks because their margins widen in that environment.

Doug Kass - Berkshire HathawayKass said his favorite stock, by far, is Berkshire Hathaway (BRKB) citing its investments in Wells Fargo and Bank of America. BRKB is also exposed to housing through its wholly owned subsidiaries Benjamin Moore Paint, Clayton Homes, Star and Nebraska Furniture, and Shaw Industries.

By Kass’ estimation, BRKB trades at a 30% discount to intrinsic value.

Kass also likes Wells Fargo (WFC) and Bank of America (BAC).

The interview with Kass continued with his response to questions from the Fast Money crew surrounding USG as a housing related investment, and his assessment regarding changing housing market dynamics in various parts of the U. S.

One Comment

  1. Anita Mantiblo

    April 19, 2012 at 6:45 am

    Interesting position. Nice to hear someone say something other than apple.

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