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I calculated the relevant all time high to be just under 300p. It was around 750p pre rights issue which occurred in Mid 2018. Essentially there were 40% as many shares on the market then as there are now, so x/4*10 should be 750, with x working out at around 300.
The price paid for the new shares to me is irrelevant, I judge it entirely by market cap (which is essentially what the market is valuing the company at) which is the value of 1 share * shares in issue. Beforehand there were around 2bn shares in issue, so a price of 750pps would give a market cap of 15bn, there's now 5bn shares in issue so to achieve the same mktcap val you'd be looking at 300p per share. I appreciate there's a dozen ways to skin a cat but this is the one I use as I feel that it reflects true valuation.
D9, I'm actually with you, I think that in Circa 3 years we will see above the £3 mark here, it will require not only a positive forward outlook, but an improvement in the balance sheet and a re-instated dividend with a reasonable yield. If I were in here for a long term hold I'd be looking for £2.25-£2.30 by next Christmas, something in the region of a 40% increase on where it is now, I'd then be expecting a 10-15% return annually starting with capital outlay and then transitioning into a mixture of that and dividend in 2023.
This could go either way depending on how the mood is as of tomorrow, but as of right now I'd imagine something ITRO
Open - 166 (1.5% up)
Peak - 170 ( Around 4% up)
Close - 167 (About 2% up)
I took my money from here and put it into BP as I was anticipating a slight drop in the £ when the Brexit deal details were a little more known, then hopefully a quick re-entry off the spike there (hoping for 4-5%) prior to AZ vaccine announcement, although that will obviously boost energy shares too so should be a win win either way. Hope you all enjoyed Christmas.
Dagger & TP, very kind words. I’m by no means an expert when it comes to trading and am constantly learning not only from the experience of others but also my own mistakes, of which I have made plenty since I started trading!
Futures looking reasonable as of now so hopefully a green finish for you all before Christmas, I’ll still be keeping an eye open for a suitable entry point, see you all next week.
ATB
In all honesty I wouldn't blame you, I've always maintained that this does have long term potential. I took it out of my longer term portfolio back at around 1.40 and started short term trading with it instead (not quite short term enough to consider it day trading). Due to there being no stamp duty here and the high volatility of the share it's one of the easiest shares to take advantage of right now. I do believe there will be a Brexit deal and naturally this will spike on that news, also AZN have submitted the data now so if that is approved for use then I'd expect another spike there. The USA seem to be planning a pretty rapid vaccination program too so I'd expect to see travel opened up there sometime after the new year if the Covid numbers are controllable at that point in time, that will be similar in scale to a Brexit deal I'd imagine.
Between the news this will always have a drift down tendency hence my buying and selling pattern. I was expecting a slightly more pronounced drop after the news from MH but we'll see how it goes towards close and in the short trading day tomorrow. In the mean time I wish everyone a good Christmas, don't spend too much time looking at the futures!
Winter is the worst time for airlines anyway, a lot of people think there’s some mythical huge demand for travel in December, it isn’t. Anyway SP will probably fall a few % on Monday due to the shift in mood, I don’t think much that’s changed will have too drastic of an effect on IAG financially, although obviously it isn’t going to help.
Realistically what news can we see before then?
Brexit deal?
AZ vaccine approval?
EU Vaccine approval?
Vaccine approval already pretty much priced in, Brexit deal will have a spike (I'm selling here if it happens) and retrace and probably sit ITRO 5-10% higher than it is now. No way is this getting 200p, or even 190p by Jan IMO. 170 would be nice, 180 would be a very good result.
With such limited availability of quarantine routes those flights are inevitably going to be full, I'm looking forwards to seeing how busy the front of the plane is to JFK once the restrictions are lifted, that'll give a good indication of where it's at, obviously no more high J 747s so less premium seats available there now unless they start sending the odd A380 over when they're back in service.
Somewhat interesting at the moment. My OH flew over to the east coast yesterday, 787-9, only her in First, 7 in club, about the same in WTP and only about 30 in a economy, she reckoned about 50 people in total were at the gate. She’s flying back in Jan and will probably go over in April, June, September and December so will hopefully be able to get a vague idea of what the load factors are like once the travel ban is lifted, the flight in January looks slightly busier but I’d expect that it will drop slightly between now and then if there’s no movement on travel restrictions.
On the flip side a good friend of mine just flew over to Dubai and apparently it was rammed both ways from the front to the back.
Paul although not directly answering your question I would take previous dividends here with a pinch of salt. In the long run (and I’m talking 5+ years down the line here) this has potential to yield very well on today’s price, well North of 10%, however to get to that point will require a fair few years with very good profit. If you’re looking for a share for dividend payments rather than a return on capital outlay, I’d recommend looking elsewhere.