This post was published on ZYX Buy Change Alert.
DB is the largest German bank. The bank has been crushed this year on rampant rumors of losses in its derivative portfolio. These rumors have been vague. In our analysis, there are certainly big losses on loans to Eastern European companies and in oil rich countries in Middle East and Africa; there is a high probability that losses are not as big as rumor mongers claim.
There is credible information that the bank may start huge buybacks. If the bank starts huge buybacks and the sentiment turns, and there is a better disclosure of its losses, the stock can show handsome gains in a very short time.
The flip side is the rumor mongers may be right and the stock may have further to fall. The other risk is the company may do a large secondary which will depress the price.
The foregoing makes this a high risk high reward situation suitable only for aggressive investors.
Consider accumulation up to 35% of the full core position size in the zone of $13 to $15.52. It is trading at $15.20 as of this writing. Target zone is $22 to $27. Stop zone is $12.23 to $12.43.
Please adjust the quantity to suit your own risk preference.
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