JPMorgan Chase & Co. (JPM), Wells Fargo & Co (WFC), Bank of America Corp (BAC): Are Banks Cheap?

Yet it’s critical to appreciate how much the banking industry has changed since 2008 and how this works in certain banks’ favors. For example, Wells Fargo’s 2008 acquisition of Wachovia gives it a much-coveted nationwide footprint. And while Bank of America Corp (NYSE:BAC) and others retreated from the mortgage market to lick their wounds, Wells Fargo & Co (NYSE:WFC) stepped in to fill the void. It now originates or services a staggering one in three mortgages.

The same can be said about JPMorgan Chase & Co. (NYSE:JPM). Its distressed purchase of Bear Stearns gave it an industry-leading prime brokerage to further service its institutional clients, and its acquisition of Washington Mutual completed its own transcontinental branch network.

The moral of this story is that, from a historical perspective, there’s reason to believe that certain lenders are indeed cheap for good reason. Bank of America and SunTrust Banks, Inc. (NYSE:STI) fit this description. Meanwhile, others seem to have suffered by association. Wells Fargo & Co (NYSE:WFC) and JPMorgan Chase & Co. (NYSE:JPM) are obvious inclusions here.

The article Are Banks Cheap? originally appeared on Fool.com and is written by John Maxfield.

John Maxfield owns shares of Bank of America. The Motley Fool recommends Wells Fargo and owns shares of Bank of America, JPMorgan Chase, and Wells Fargo.

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