Now here's something a bit cheeky. Goldman Sachs has put rival investment bank Merrill Lynch on its Conviction Sell List, and forecasting further credit crunch write-downs.
Analyst William Tanona told clients: "Merrill currently trades at the highest price to book multiple in our large cap brokerage universe, despite having some of the most significant exposures to troubled assets such as CDOs, mortgages and leveraged loans.
"With these markets still under pressure, we believe additional write-downs (in addition to write-downs assumed after the partial sale of CDOs to Lone Star) and book value deterioration will continue to plague the stock. As a result, we see no reason why the stock should be trading at such a premium."
The effect has been marked, with Merrill shares falling nearly 8% in pre-market trading.
