Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Great post :-)
Thought I’d make it one more comment 22 than the RNS figure 21. Standard Chartered (not cartered). I’ve carefully studied their investments and I think long term they’ll beat even Barclays. The computer algorithms might not look at the facts I research. They are heavily invested in India, Singapore, Taiwan. Check out their stock markets, inflation etc and the future looks promising. Next results on 2nd Nov.
I’m a physics teacher with an obsessive fascination with share prices and compared to most, very little to lose - it’s in an ISA. When I saw today’s results I was expecting a rise of about 4% ( based on what? Bank of America’s recent results). When it didn’t rise, but fell slightly I wasn’t surprised. Those in the know and most others had heard the annual profits were in excess of 6bn. If a physics teacher knows this info then everyone does. It’s actually relatively healthy to have the knowledge beforehand. As the news is released, typically the sp drops, it’s no longer speculation. It will be the same with interest rates. Everyone knows they’re going to rise. When it’s announced that it’s happening bank shares will fall. Not a surprise.
Instead, look at the longer term prospects. Interest rates will continue to rise. B of E and UK Govt can’t stop it. They may halt it but it’s predestined to happen. Just like Glencore has returned so will banks. You can get 1% on your savings account now. Next year you may get 3%. Instead buy Barclays shares and other banks like Standard Cartered and VMUK. In my opinion, they will increase by more than 3% in the next 12 months….
The UK Banks are currently sat on huge sums of capital that isn't making them a lot of money with the interest rates at the current level (0.1%) - which is the lowest in the Bank of England's history.
Inflation is rising, and there is pressure on the Bank of England to raise interest rates. Now currently the Bank of England is buying Bonds on the open market and this is known as quantitive easing. This is going to stop soon and UK Banks will be there to pick up the slack. Typically in any economy if inflation was running at 3-4% then you would expect interest rates to be fairly close to that. The BOE won't increase rates that high - it will be gradual. Likely to be moved to 0.25% in November and then to 0.5% in February 2022. If that happens then the banks can sink an awful lot of money safely into Government Bonds where it will immediately start earning them money which they aren't getting today. If inflation doesn't start to cool then interest rates could rise further still without causing any serious issues to the economy - as with inflation comes wage increases, then comes interest rate rises etc. It's only when interest rates get higher like 10% where it can have a serious negative effect on the wider economy and can then become a problem for banks due to large increases in defaults. (I am fully aware that there are people today with Mortgages where an increase to say 2% could be the difference between them keeping there home or losing it - this is true - but not in numbers large enough to destabilise the entire economy).
In the meantime, UK Banks will start to receive a lucrative income that isn't there currently. Barclays aren't as reliant on that type of income as Natwest or Lloyds because they have a strong investment bank. However, the retail side of Barclays that has also done well will definetly benefit so the headwinds are favouring UK Banks currently and long suffering shareholders are in for a good couple of years - and hopefully beyond.
A few points to note:
Jes Staley and Tushar Morzaria advised they weren't surprised by the initial drop on results day and it can be typical as professional investors take to profit taking. But todays drop shouldn't be a worry as the stock is still bearish and will continue to climb.
Buybacks - There have been two major buybacks this year. One of £700m at year end results for 2020 and recently the still 'ongoing' £500m buyback. These are being bought every day at market prices and there is a limit on the volume of shares traded per day that can be bought. So it's not as simple as saying we'll buy £500m @£1.70. They have to buy gradually each day and the price has recently crept up. But even @£2 per share they're being bought back cheap when compared to the net asset value for each share of £2.87. If the share price was above that then shareholders would be better served getting excess capital back as a dividend (noted some would just prefer that anyway but that's not my talking point)
The example quoted by the CEO was this, "Essentially right now if our stock is worth £1 we are buying back at 70 pence. So you are getting that 30 differential for free. That is why buying stock back is so attractive"
Whilst he was using those figures to explain the banks approach I actually think we're getting a far better deal on the two buybacks over the last year.
In terms of progress, the bank has had a target for a number of years of a 10% return on equity. The last few years they have fallen short of that target. We're on the 3rd quarter this year and the figure is already at 15%. So even if Q4 is really bad they will comfortably hit that target of 10%. The bank is well positioned now to hit a 10% return on equity year in year out.
Dividends - The bank has announced at the interim results that they will pay a dividend on a progressive basis. So that has already been confirmed as 6p for 2021. They will pay a slightly higher dividend in 2022 and slightly higher again in 2023. The aim is to have a dividend that grows with the growth of the bank every year and that it is very consistent. So if in 2021 the bank has made 35p per share and it has paid out 6p in dividends then there is a lot of room for a progressive dividend over the coming years. A consistent buyback program in support of this and a consistent return on equity of 10% then the stock will grow.
Back to a point in an earlier post, you only have to look at the experience of the major US Banks. They were all trading at this sort of level two years ago, but they kept generating levels of profitability that Barclays is now looking at. So I believe the markets will eventually, within a couple of years value Barclays above it's net asset value which is what we were used to pre-financial crisis.
All week barc share price was hitting £2 based off of expected earnings/profits. Today actual real earning/profits came out, earnings up profits nearly doubled and the share price goes DOWN. The sp is down more than likely because one cylinder out of six wasn't performing as well as it might have. But they were more than happy to invest in barc on the news, but dump the stock on very good facts. Its the craziest sh*t I have ever witnessed!!!
Staley should start the buybacks around about now, he would do us investors in this stock proud, but they always seem to buyback when the stock is near a peak, never when its at its trough. So in conclusion the bank is much stronger financially than it was yesterday and its sp is less. Barc has to be a bargain, but the buyers have run for the hills today because the profits have doubled and the news is much better as fact, rather than yesterdays fiction.
Afternoon bald_eagle,
Not forgetting our gardens are being infiltrated by entish tree shepherds who interrogate gardeners and sun bathers whilst under the influence of a mind control substance known as 'Secret Soya' #5, to gather intelligence which is passed on to spy masters based in a network of takeaways.
"First they create and spread" .... baked noodles!!
And noodles and soya sauce contain a mind altering control substance
.... yeah, cos Enron, RBS, Marconi and other Company failures never happened.
" First they create and spread Covid to every country..."
======================================================
Their mobile phones have mind control software embedded in them....and I'm pretty sure they are kidnapping our HGV drivers, dipping them in clay & turning them into figures in their Terracotta army!!
" Cum-ex is understood to have cost governments nearly €10bn. But according to researchers at the University of Mannheim, that figure is dwarfed by losses stemming from another long-standing form of dividend arbitrage, known as cum-cum (a 'very conservative 'estimate of £141bn).....experts say cum-cum sits in a legally grey area.
"It's not against the law," explains Christoph Spengel, a professor of international taxation and the leader of the Mannheim team.
"But in individual cases, in Germany it is against the law if the sole purpose of buying and repurchasing shares is to have a tax benefit.""
[https://www.bbc.co.uk/news/business-58984813]
"Major tax evasion and avoidance schemes have cost governments an estimated €150bn (£127bn) in lost revenues, research shows. So-called cum-cum and cum-ex schemes are designed to exploit weaknesses in national tax laws."
[https://www.bbc.co.uk/news/business-58984813]
Cum-cum & Cum-ex sounds more like a pawn(sic) movie. The governments will want their money back....let us hope BARC weren't too involved but 'probably' up to their neck (as usual)!!
China are getting great at fking the global economy! First they create and spread Covid to every country and yet they seem to be the only economy undamaged by it and now Evergrande!
I know it doesn't always work like that.
I guess I was making two points here. Barclays are still classed as cheap because they're trading below their book value - and Jes Staley said one of the reasons he's deploying buybacks is if shareholders are willing to sell shares back to him for less than they're worth he's happy to buy them.
My second point, is that American banks are trading at a higher price than their book value. As cyclical stocks British Banks tend to follow American Banks - it can just take a while.
The market decides on the share price. Net Asset Value is just one of many things to take into account when looking at where to invest. If Barclays was to get taken over, broken up and then sold off then after selling the assets it would be worth more than what the market is currently valuing the firm. They're trading at 0.6 of the value of the assets - so they are classed as cheap or 'Value' shares.
The stars seem to be aligning for financials. Barclays have today announced their best ever year to date results. Better than the golden times before the financial crisis. So for a number of reasons I agree with Brighty that £3.50 within 18-24 months is not beyond the realms of possibility.
Just an observation. Barclays Net Asset Value per share has increased to £2.87. So Barclays shares are still cheap by this measure. In contrast American Banks are trading above their book value. As an example Bank of America is trading at 1.58 to the value of each share.
So, when British banks catch up, and they usually do Barclays @£2.87 x1.58 (PB Value) would give Barclays a share price of £4.53.
So £3.50 within 18 months is achievable in my view.
Looks like the excellent results are being overshadowed by the poor general market sentiment at the moment.
Reading the article on the BBC I knew that Barclays would be involved somewhere:
"More than 1,000 individuals are currently under investigation. Documents made public during the trial show that banks such as Barclays and Santander are under scrutiny, along with high-profile US financial giants and a large number of German institutions. "
[https://www.bbc.co.uk/news/business-58984814]
The last time we were producing similar results to this our share price was over 500p. 225p by the end of this year and 350p within 18 months is looking on the cards for Barc. Good luck, Brighty
If it goes down enough I'll buy more
Before it goes up, it will go a bit down.
Fantastic Q3 results today. I'm sticking with my prediction of BARC at 225p by the end of this year and 350p within 18 months. Although we could be much higher than 225p by the end of this year judging by the results today. Good luck, Brighty
Barc results reflect that jovial mood Jes was in few days ago.
Looking very promising.
Good day Thursday they announce Q3 results……I’m sure they will be outstanding
Anyone believe in the codes?
Code 1 just before close - 1 share sell, 1 share buy
Good day tomorrow?
fingers crossed