Member Info for adeg1

I assume it is his speech from the AGM?

Current price is £6.80. The £500m special Dividend is circa £1.06 to come off this along with a 9p initerim announced today, so base price is now £5.65.

They are saying the annual dividend will reduce by 50% per share following the transaction, so this would be circa 15p giving a new yield of 2.65%.

The new yield looks a little low but the view is that they can increase this as their new products and acquisitions grow.

Yes apologies on that, I hadn't looked elsewhere to check that the LSE website was publishing every RNS. However I do stand by the point that share buybacks are only good for a shareholder if the market value is below the net book value, buying back an intangible asset does not make business sense.

I'm not sure they will recommence buybacks at this price. The last purchase was at £14.20 back in September. If the price drops back to these levels then they will start again but at the current market valuation there is no value in a buyback programme as you are purchasing shares above the companies NBV. A dividend would be a better way to distribute excess cash and shareholders can decide themselves if they want to reinvest and up their percentage holdings.

You do realise that the 7p is already built into the share price and that if they paid a special dividend of 7p the market would reduce the share price by 7p. It's a concept called Efficient Market Hypothesis. Unless of course you believe that the market is not efficient and is pricing Lloyds wrong.

If the company is using cash on its balance sheet to buy back shares at just under the net book value there shouldn't be much change in the share price anyway. All that it means is that future profits and distributions will be shared between fewer shares.

But as long as they are buying the shares back at below the net asset value then as far as I am concerned they can continuing doing it until there is only me left as a shareholder.

Munich Re sold 12.1 million shares (4% of the company) in one go. That big a seller will always drop the price , take it as a buying opportunity. They had been in since 2002 and at one point owned 15.1% of the company so they have banked a nice profit but have been reducing their position gradually for years.

My view is that there is still money to be made and that this will pay good dividends for years to come. Just hope the price stays low for a few more weeks until my next top up.

net book value per share was £1.72 per share from the interim results. Therefore they will be buying back goodwill with the share buyback scheme. This is not right as far as I am concerned and you should only buyback shares when the market capitalisation is below the NBV of the company. They should pay it out as a special dividend instead.

They can repurchase every other share out there as far as I am concerned. I will then own 100% of the business, thank you very much.

I did...
What we need now is a review/recommendation in one of the Sunday papers and this will fly next week.

Does he want to buy my shares for £1.57 each?

I hate and love the markets at the same time. We drop 10% on someone else's revenue figures but then only increase 3% when our revenue figures show that we are ahead of the previous year. I suppose it just gives us another buying opportunity.

you have to factor in the change in the US dollar exchange rate to that calc, which probably accounts for most of the change.

The current market cap is £15.884 Billion but the Net Assets Book Value of the business at December 20 was £20.560 billion. So by buying back shares they are buying them at a discount to the net book value. In this scenario they are paying 77p for something valued at a £1.

In theory, taken to the extreme, if they cashed everything in and bought all the shares back at the current market value the last single shareholder would be left with £4.676 Billion.

However I also like to take off the intangible assets from the NBV as they would be worth nothing in a firesale, which in this case is £4.233 Billion. Even with this they are still buying shares under an adjusted NBV so I am happy with that.

Except that as someone who writes budgets/forecasts for businesses the 3% payrise I had factored in for April 2022 reduced to 1.75% yesterday.

no we already know. £4 billion will be returned to shareholders and they are spending £750 on a share buyback programme. This leaves 3.25 billion to return. If it's a special dividend across 3.990 million shares then that's 81.5p each. This figure will increase the more shares they are able to buy back.

However the share price will also reduce by the same amount on the ex dividend day as it is already fully built into the current share price. The only question will be when do they make the payment.

No, I think the Q1 trading statement will be on the morning of the 22nd before the AGM. However they should know the figures now so I see no reason why they couldn't issue a statement saying "we know of no reason for the 10% drop in value today". Unless of course the figures are bad and we needed the correction.

It will be interesting to see what happens over the next few weeks as the news leaks to the market.

well they better hurry up and get the first quarter trading statement out then, preferably before the AGM on the 22nd. It was the 17th September last year with Q1 revenues of £209 million. If they are anywhere close to this figure we could see a push on £10 per share.

Don't knock the old skeggy caravan park. They are charging £2k-£3k per year just to park your caravan on their field and all they do is cut the grass, empty the bins and count the money. Make more doing that than you ever will on Lloyds.

But why does it take 6 weeks for them to make the payment? In the days of electronic share registers and faster payments what is stopping a company paying me my dividend the day after the record date?