If I was the CEO of a big canadian bank...

If I was the CEO of a big canadian bank, I'd surely buy Home Capital Group (HCG.TO).

At the actual price of about 27$, this stock is selling at less than 6 times next year earnings, which is a total bargain given the fact that this company is making money and has a great track record (even though the last months have been hard: no growth).

At 6 times this year's earnings, you'll get a company that has an historic ROE of almost 25 (however, the ROE should be between 16 and 20 this year).

Some people have been buying AIG and Bank of America because these stocks have been trading under book value. Well, with Home Capital Group, we have a financial stock that is selling almost at book value, with a PE ratio under those of AIG and BAC without any heavy charges comparable to AIG and BAC. HCG has been managed much better than AIG and BAC over the years. As a bonus, you'll get a great dividend of about 3,2% with HCG.

I think there's not a single stock in the TSX with a comparable track record that is selling for such a low price.

So, maybe not any CEO of a big canadian bank will buy HCG. But if they did, it would be a great move in my opinion. They would get financial assets that are performing better than their actual asset and they would pay a ridiculous price.

If they don't buy it, you could do it. I've done it yesterday. And if my position wasn't so high, I'd surely put a lot of money on HCG right now.

I don't see how that stock could go much lower than that.