Dividends4Life: Interest Rates Will Stabilize Eventually - Buy This Dividend Stock Before They Do

Dividend Growth Stocks News

Early in the pandemic, I bought Bank of America (NYSE:BAC) stock for my retirement account. I believed interest rates would rise, and that when money cost money, the big bank would prosper. I was still confident in January 2022, but I was wrong. Since the pandemic began abating, as interest rates have risen, BAC stock has been a poor investment. Over the last two years it’s down 38%, while the market has been flat. In 2023 it’s down 17%, while the S&P average is up 14%. I admitted this to myself and sold out of BAC in February. Is it time to get back in?

The turn will come. Interest rates will stabilize. When that happens, Bank of America will benefit more than its peers, because it has been hurt more. If you wait until after the turn, you’ll miss the easy profits. Even the hint of a turn sent BAC stock up 3% on October 10. This makes BAC the safest speculation a long-term investor can make right now. You’ll likely get the dividend while waiting, but then earnings will rise, along with the PE multiple, and you’ll look like Warren Buffett.

Source: InvestorPlace

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