Lloyds share - Worth a punt?
Discussion
Was chatting with my brother this weekend his Mrs works for the Halifax. I was surprised to hear they were still paying into a sharesave scheme there but apparently the general feeling within the group is pretty positive and all the staff are hoping to make some considerable money from schemes that mature in 2/3/4/5 years time.
Now I seem to remember that there were some rumors that the Lloyds group was going to be split up by the competition commission? How would that potentially leave you if you were sat on a load of shares? Must admit I'm quite tempted at 68p
Now I seem to remember that there were some rumors that the Lloyds group was going to be split up by the competition commission? How would that potentially leave you if you were sat on a load of shares? Must admit I'm quite tempted at 68p
Yes worth a punt in my opinion, as long as you know its exactly that a punt.
I'm playing a bit of a long term strategy on these, got in during the last rights issue and now sitting on an average price of about 45p. I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
As of today they have already hit the year highs as earnings are due soon and we may see 75+ before the earnings are released.
I'm playing a bit of a long term strategy on these, got in during the last rights issue and now sitting on an average price of about 45p. I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
As of today they have already hit the year highs as earnings are due soon and we may see 75+ before the earnings are released.
twinturboz said:
I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
for all I know you are Buffet of Soros, so I mean this in the nicest possible way, you do realise that £2 a share would mean Lloyds would have a market cap of £134 Billion, and £3 would mean a market cap of about £200 BillionThats a huge valuation for a company with a NAV of £44 Billion at the last year end
twinturboz said:
Yes worth a punt in my opinion, as long as you know its exactly that a punt.
I'm playing a bit of a long term strategy on these, got in during the last rights issue and now sitting on an average price of about 45p. I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
As of today they have already hit the year highs as earnings are due soon and we may see 75+ before the earnings are released.
I agree that £2 is very probable in 2 years, I got in before rights issue and have a spread of prices paid, highest £1.08 lowest about 48p, rights issue I took maximum and investment running @ +72%. Lloyds 1st Q figures out tomorrow so lets see, they are a massive bank now! RBS figures out wednesday and have a lesser exposure on them but positive outlookI'm playing a bit of a long term strategy on these, got in during the last rights issue and now sitting on an average price of about 45p. I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
As of today they have already hit the year highs as earnings are due soon and we may see 75+ before the earnings are released.
matsmith said:
twinturboz said:
I reckon in about 2 years these should be close to the £2-£3 mark providing the economy recovers and we don't have a double dip.
for all I know you are Buffet of Soros, so I mean this in the nicest possible way, you do realise that £2 a share would mean Lloyds would have a market cap of £134 Billion, and £3 would mean a market cap of about £200 BillionThats a huge valuation for a company with a NAV of £44 Billion at the last year end
Since the merger went through LLoyds is the UK's biggest bank with control of over 1/3 of the UK's mortgage market. Providing they can shake off the losses that it acquired through HBOS, which they have begun to do and again providing the economy recovers then I think LLoyds are best placed to take advantage.
In essence playing a long term trade on LLoyds is betting that the Uk economy and housing market will recover within the next 2 years.
Henna- lets hope tomorrows announcement is a good one, although I reckon there could be a bit of profit taking.
Edited by twinturboz on Monday 26th April 14:37
Henna- lets hope tomorrows announcement is a good one, although I reckon there could be a bit of profit taking.
Edited by twinturboz on Monday 26th April 14:37
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If the results are good then I am sure there will profit taking but as it drops the big institutions will dive in and they will be for the long term so end 2md, 3rd quarter will strengthen, I read on google finance that target has upped for RBS to go to 65p and Lloyds 81p. That is a good little site! They still are not lending though! I wanted a largish sum to do a repeat of what I have done twice now in 3 years but not interested unless charge on house, I was putting 50% in! its pathetic, loan paid back in two years all under contract. That's what worries you some businesses must be really up against it because of "our banks" attitude!
Lloyds had 5637 million shares in issue in 2007, and according to Yahoo they got up to about £6 in 2007- thats a peak market cap of about £34 billion
HBOS had 3735 million shares in issue in 2007, and peaked at about £11- thats a peak market cap of about £41 billion
so the combined peak market caps of these is £75 billion, and thats based on spikes. the VWAP for the year would be around 10% lower than this
to match that peak market cap the lloyds banking group share would hit 112p. with all thats happened in the past few years, do you really think that in just 2 years they are going to be worth 2 or 3 times the value that they had at the peak of the massive bubble we experienced??
maybe (hopefully) you'll be right, but I dont see it somehow
HBOS had 3735 million shares in issue in 2007, and peaked at about £11- thats a peak market cap of about £41 billion
so the combined peak market caps of these is £75 billion, and thats based on spikes. the VWAP for the year would be around 10% lower than this
to match that peak market cap the lloyds banking group share would hit 112p. with all thats happened in the past few years, do you really think that in just 2 years they are going to be worth 2 or 3 times the value that they had at the peak of the massive bubble we experienced??
maybe (hopefully) you'll be right, but I dont see it somehow
Well...they definitely won't be worth what they were at the peak, that's for sure. Since then they bought business (HBOS) that nearly took them down too.
The shares may be worth a punt but you should remember that Lloyds fortunes are very much tied into the prospects for the UK economy so if you have a job that you think is susceptible to a slowdown in the economy or if your have a lot of your wealth is tied up in your house you are simply inreasing your exposure to it. Having said that Lloyds are much probably much more sensitive to the recovery on the upside so if you are a believer in the UK economy buy them.
I wouldn't take much notice of people that work for them to be honest, they tend to get blinded by management memo's etc telling them how well the company is doing etc. And of course they want to believe things are going to get better. I knew people at both RBS and Lehman who were oh so bloody bullish about the companies they worked for.....one guy at Lehman was a senior strategist who I remember saying how bad things were going to get pretty much before anyone else and everyone thought he was mad! Yet he still thought Lehman would be fine......
The shares may be worth a punt but you should remember that Lloyds fortunes are very much tied into the prospects for the UK economy so if you have a job that you think is susceptible to a slowdown in the economy or if your have a lot of your wealth is tied up in your house you are simply inreasing your exposure to it. Having said that Lloyds are much probably much more sensitive to the recovery on the upside so if you are a believer in the UK economy buy them.
I wouldn't take much notice of people that work for them to be honest, they tend to get blinded by management memo's etc telling them how well the company is doing etc. And of course they want to believe things are going to get better. I knew people at both RBS and Lehman who were oh so bloody bullish about the companies they worked for.....one guy at Lehman was a senior strategist who I remember saying how bad things were going to get pretty much before anyone else and everyone thought he was mad! Yet he still thought Lehman would be fine......
Fesuvious- Lloyds "only" have assets of about £1 trillion, compared to RBS £1.6 trillion, Barclays £1.38 trillion and HSBC at $2.36 trillion (£1.53 trillion at current exchange rate)
Lloyds may claim that they are deleveraging and derisking their portfolio, but at the end of the day if you have £1.027 trillion in assets and £983 billion in liabilities, it only takes a 4% drop in asset prices to wipe out the shareholders equity
I dont see how it would be possible to make the vast profits you foresee with that kind of balance sheet, nor do I see where they are going to get £20 billion to buy back HMGs shares?? thats assuming the price stays at 70p...if it goes to the £2 or £3 or £4 (thats gotta be a record optimistic guess!!) then they will need £60-£120 Billion to buy them back!!!!
Lloyds may claim that they are deleveraging and derisking their portfolio, but at the end of the day if you have £1.027 trillion in assets and £983 billion in liabilities, it only takes a 4% drop in asset prices to wipe out the shareholders equity
I dont see how it would be possible to make the vast profits you foresee with that kind of balance sheet, nor do I see where they are going to get £20 billion to buy back HMGs shares?? thats assuming the price stays at 70p...if it goes to the £2 or £3 or £4 (thats gotta be a record optimistic guess!!) then they will need £60-£120 Billion to buy them back!!!!
Beardy10 said:
They won't be buying the shares back....the govt will sell it's shares either in the market or we'll have public offerings like we did when the Tories sold off Utilities, BP etc
Did anyone listen to the discussion on radio 2 today about Lloyds & RBS, two very different views one to sell now but I see that "darling" said he is not in a hurry to unload them which is why I think Beardy is probably right. Both shares dropped but seem to be rallying again, probably proft taking. The US gov are selling 20% of the 7.7 billion Citigroup shares they hold so it will be an interesting comparison to see what happens over the pond, the numbers are crazy!Gassing Station | Business | Top of Page | What's New | My Stuff