The Bank of New York (NYSE: BK) has recovered strongly from The Great Recession.  But it is still lagging behind others such as JP Morgan (NYSE: JPM) and Wells Fargo (NYSE: WFC).  Due to this, there are three reasons investors should consider buying shares of the Bank of New York.

The first has nothing to do with the merits of the company, even though it is a fine business.

Activist investor Norman Peltz has targeted the Bank of New York.  He feels the stock should be trading at a higher price.  As a result, he has taken a sizeable position in the Bank of New York.  The stock price has responded by going up immediately!  It should go up even more!

The Bank of New York pays you to wait.

Right now, it pays a dividend of around 1.8 percent.  That is the average dividend yield for a member of the Standard & Poor’s 500 Index (NYSE: SPY). The dividend amount will most likely rise in response to Peltz’s demands.

The last reason is that the Bank of New York has a very solid business model.  It does much institutional work.  That solidifies the earnings stream.  This is shown by the high level of institutional ownership, more than 80 percent, for the Bank of New York.  That institutional investors such as mutual funds and pension groups own so much of the stock is a very bullish sign.

The Bank of New York has hardly performed poorly as it is up more than 27 percent for the last year of market action (chart below).

But Norman Pelt, who is very successful, thinks the share price should be higher.   That in itself is compelling to other investors due to how well Peltz has done in the past.  But there are many other reasons why the Bank of New York is very appealing to long term investors.