John Paulson: Bank of America's stock will double by 2012

18 November 2009

Bank of America's stock will double over the course of the next two years, hedge fund investors have been told.

In a letter to clients, Paulson & Co, which is run by billionaire John Paulson, predicted that Bank of America shares may rise to almost $30 by December 2011.

The share price currently stands at $15.77 on the New York Stock Exchange, reports Bloomberg.

In February this year, Bank of America shares stood at $2.53 but investment by John Paulson's hedge fund has helped the turnaround.

The letter told investors that Paulson & Co believes they have yet to reach their peak.

"[While the bank] has risen from when we purchased the stock, we believe considerable upside remains," it said.

Paulson & Co is a respected name in the financial sector and had its reputation improved last year after it made an estimated $2.5 billion by betting against the US housing market.

Last month, Bank of America reported a net loss of $1 billion for the third quarter of 2009, partly due to paying $402 million to terminate an asset guarantee term sheet with the government.

By Gary Cooper

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