Wachovia Worth $7.29+ per Share?

Wachovia (NYSE: WB) shares are trading down sharply despite an activist investor's belief that the firm is worth far more than its current share price. William Ackman's Pershing Square believes that the financial firm could be worth between $7.29 per share and $19.59 per share, which is well above its recent trading range.

How does Ackman come up with this lofty valuation? Well, the activist began by noting that there could be as much as $20 billion of cash in Wachovia's holding company. Meanwhile, the bank's brokerage and asset management units could be worth $4.3 billion to $8 billion and could see interest by the likes of Goldman Sachs and Morgan Stanley.

Wachovia itself has yet to disclose many of the details of the transaction, which ultimately makes it difficult to tell. Meanwhile, the company is the center of a lawsuit between Citigroup and Wells Fargo claiming that the higher bid was a violation of rights. Citigroup insists that the Citi/Wachovia transaction would have been signed and announced on Friday had it not been unlawfully subverted by Wells Fargo.

Shares of Wachovia Corporation fell $0.35, or 5.48%, to $5.87 per share on the day.