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As a previous investor in IAG, I follow this share on a daily basis as I am keen to re-invest when the timing is right, or as near to when I can predict it to be right! I think this share is great for short-term buys and sells as it appears to be quite volatile. The question is, where will it go next?
Positives - opening up of traffic and ability to travel.
Negatives - restrictions to the USA still in place (IAG's bread and butter), furlough ending, high oil price, recommencement of pension contributions, other airlines' share dilution and will IAG follow suit as a necessity for the next 6 months, an unexpected Winter ahead!
For me, I am happy to wait a while longer as I am expecting further falls, before the move over £2.00. I think anything sub £1.45 is an ideal buying opportunity. In the meantime, I am invested in safe, quarterly dividend paying stocks - Unilever and BP which are more stable and provide a regular income.
Anyone listening to Nicola Sturgeon's speech at the moment? Quite insightful. Looks like overseas travel this Easter and more importantly, this Summer is not going to happen at all. What will this mean for the Airline share prices and possible more share RI's and dilution happening?
As an abserver of this share price, I can't help feeling it is still slightly too high to invest in. Current closing price is equivalent to £3.86 pre-Rights Issue and this does not feel realistic to me. I remember at the time of the Brexit Vote, this share price dropped to £3.40 or so, but that was when revenues and profits were phenominal for IAG. With hardly any revenue coming in, and presumably any flights that take off later in the year might be filled with cancellations from 2020, it does not look promising at the moment. Although I cannot see £1 a share being reached again, I can see the £1.20's or £1.30's being a good entry point if holding this share for at least 9-12 months. What do others think?
Whilst keeping away from the share price fluctuations in this stock for a while, until the RI has taken affect on the share price, it looks like there is some stability in the price for now. However, we now have many further headwinds in play which do not positively help the airline industry - Brexit, rising infections, US Elections, reduced communications on a vaccine in 2020. Personally, I do not see any material uplift likely in the share price until 2021 and therefore my question is how low can this fall before it bottoms out? I think somewhere in the range of 60-70p would be a good entry point? What do others realistically think?
Read an insightful article on IG.com today about IAG, covering details on trading results, expectations and most importantly the Rights Issue (all of which we are fairly well educated on from our own individual research). It highlights that the share price will reach new lows in the coming 1-2 months based on current trading, but largely due to the Rights Issue. It anticipates new lows below 148p, which to me is quite generous, as I foresee them going much lower upon Rights Issue official communication on 8 Sept. Therefore, unless you are definitely going to take up the offer, the best advice I can offer is to sell now based upon the last 2 days of up-tick in the share price, as I don't seeing it reaching £2.00+ anytime soon.
Current talk in the media about Rights Issue, is that it IS coming, and likely to be at the end of the Summer Period, presumably once IAG have a better understanding of the state of the Travel Industry - ie - is there any hope or not! Quarantine lockdowns are being quick to be reinstated where required and all of the Government decisions on this will heed people's views on whether to book a holiday in 2020 or just go without this year. With all of the media discussions on Rights Issue, I believe it will have to be mentioned in the Results tomorrow as a note, however I am not expecting to hear detailed specifics at all, as it is too early to do this. Moreover, it will be making markets aware that it is currently exploring all options of further funding and shoring up its balance sheet. I believe this continued uncertainty will simply allow the share price to slowly decline over August and into September and I stand by my £1.20 to £1.50 prediction over the short term.
I think the article below provides good reading and compliments a lot of the views on this board about IAG.
https://www.ig.com/uk/news-and-trade-ideas/iag-share-price-could-fall-below-179p-support-level--says-ig-ana-200729
Hi mark@1973 - I agree with you that in the longer term - this is a good investment! It is all about timings of investment, and although no-one ever knows where the bottom lies in terms of the share price low points, I think most investors in this share price know that there is further downward movement still to come. From Friday's Q2 results, I expect all of the bad news to be made public, which could set a new share price low for IAG, bearing in mind travel stocks are very likely to see big losses in share prices on Monday morning trading. I have previously owned IAG shares and made good money from share price growth and dividends since Brexit announcement in 2016 and just waiting on timing the market as best as I can to interpret a true "bargain basement" price, which I forecast to be around £1.20 to £1.50.
It's so interesting how many people on this Message Board seem to think this share price will suddenly "bounce" back to £4, £5, £6 and beyond, just because the share price been at these levels in the past. The world has changed, people's views on travel are changing, and the travel industry is going to take a little longer than 2-3 year's to recover owing to people's confidence levels on the safety of travelling abroad. With the realism of a vaccine maybe in the first half of 2021 at the earliest, people will continue to stay clear of overseas travel and future bookings are likely to stay at low levels - probably not at the levels for airlines to break even. I expect there to be a significant sell-off of IAG shares this coming week as the levels of uncertainty are now beginning to increase further and I will be watching the share price with interest. For info - not wanting to come across as being too negative with this share stock, however I am a realist and all the key levers with this Company point towards further downwards trending in the share price at the moment.
Well, the 14 day imposed quarantine on flights from Spain will be the tip of the iceberg for what is going to follow in the next few weeks and months ahead in the financial markets. Sentiment is starting to change and the positive "denial of a world wide recession" that seemed in place in the stock markets will slowly erode into a tough few months as the second wave looms, US-China tensions continue, no-deal Brexit becomes more and more obvious, US Presidential election unknowns all flow back into the markets with more poise. This will only create more uncertainty, more angst, which will mean stock market corrections. The IAG share price will inevitably suffer from all of this and so, IMHO, hold onto that spare investment funds a little longer and don't get too excited about a sub £2 share, when it is likely to go sub £1.40 in the short term.
Well, as predicted by myself and many on this Message Board, the financial effects now facing this airline group as well as other airline groups appear to be slowly deteriorating as each week goes on. The market capitalisation of IAG, IMHO is still too high, as although they had in March circa £10 billion of liquidity, they had a net debt position of over £7 billion, which can now only be significantly higher today. IAG appears to be drastically calling on as many levers as possible to boost their financial position, however the share dilution upon equity raise and / or rights issue (if the right is not taken up by existing shareholders), means a significant dilution of investment. Upon reading today and a possible £2.5 billion raise, this is more than 50% of the current market capitalisation. Therefore, from my previous prediction of £1.65 a share, I now see this going much lower if this action is undertaken, possibly to £1.20 to £1.40 a share. Note @whatamess prediction of 80p - you may not be too far off with your previous forecasts. As previously advised, this share was one to have sold 2-3 weeks ago and to then repurchase later in the year at a price which looks like it will become significantly cheaper - never be afraid to realise a loss, when you can repurchase at a lower price in the future - a risky strategy, but one which looks to be a good bet with this share.
Well, I agree it is good sign that they are bringing forward the decommission of these planes which burn more fuel and aren't as economical as the new fleet on order. However, it also signals a sign that BA do not foresee any material amount long-haul flying of planes in the very near future, which will act as a negative on the ability to make a profit, let alone break even.
Looks like the stock markets are now starting to reflect the anticipated corporate news flow which will be communicated over the next few weeks - IAG 31 July - which will be very interesting. On the plus side, everyone is hoping for a vaccine, which will lift the worldwide markets considerably, however on the downward side......well I haven't got that much time to list everything, that we already know (judging from reading this bulletin board). Watching Peston last night our Health Minister was not at all optimistic of a vaccine by the end of this year and was more realistic of one next year, which can be produced and rolled out across the various demographic groups. Carefully watching this share price with interest to make my investment as although there is going to be plenty of short term pain, there will be lots of long term gain - it's just timing an acceptable entry point which I am expecting on 31 July. IMHO, I foresee a 30-50p share price drop in the morning of 31 July, when their results are announced and then a steady retrace during the course of the day. Of course, it could go in completely the opposite direction.....anything can happen with this stock, expect the unexpected!
Something of a turnaround in the US Markets yesterday, from seemingly fairly bullish trading in the morning, but significantly bearish in the afternoon. The media seem to reporting even greater levels of COVID infection rates across the globe and this will only mean one thing - further caution and further restrictions. None of these allow for any significant upside in the Tourist and Travel industry and therefore it will be much longer before companies in this sector produce any form of profit, let alone be able to break even. The flow of less positive Q2 results are starting to flow now, and although I am expecting the banking sector to produce good results this week, there is a risk of large provisions for bad debts and defaulted loans in this area. I am watching the IAG share price carefully as this should now begin to decline to my estimation of £1.65 before I reinvest back into the stock. I am then looking for a 2-3 year investment and growth towards £3.50, which will be a great return on investment.
Well, EZJ is now down 7% today, so expecting IAG to continue the trend. Not a great deal of support from the Government today to further assist and boost the travel and tourism industry, therefore I am still expecting the share price to continue to slowly decline further. There does not seem to be any great positive news due in the short term to boost this sector at the moment, until such time that the virus is stabilised (ie - in the US) and a vaccine has passed through all of the required, clinical trials. Will cautiously now be following progress on BREXIT as this will completely spook the financial markets if a deal is not agreed by the end of the year by all parties.
Well, it's true then "what goes up, surely comes back down". Expect this week to end up in negative territory. Historically, July month is usually a poor month for IAG is terms of share price movement, and with the exceptional circumstances that we are in, I do not see it fairing at all well this month. There are too many negative factors going against this share at the moment, and we are on the brink of hearing poor economic news across almost all industries which will last well into Sep/Oct, especially when furlough is turned off. In my years of share trading, I have learnt that it is okay to realise a loss on a share if I think it will only go even lower and by doing so, it allows greater profits to be gleaned in the long run. IMHO, this share has all the hall-marks of dipping lower, maybe into the sub £2 levels when the next round of "bargain buys" comes to fruition.
As predicted, the early morning rush in the share price turned into something of a baby step forwards. With the FTSE up 100+ today, expect something of a decline tomorrow (what goes up, must come down), and I suspect IAG will be down by more than its increase today. I also suspect a muted Wednesday with the markets anticipating Rishi's announcements, potentially then two red days to follow. Anyone have any recent articles on possible Rights Issue developments as this will dilute the share price further?
Looks like all the excitement has fizzled out of this share today and more caution is taking over. What usually happens on a "blue" start to the day is that by 10am to 10.30am reality kicks in and the share price begins to fall. I bailed out this morning at £2.35 from a £2.12 purchase a couple of week's ago. I still don't think the recovery is going to start for a while and I'm happy to buy in at the £2.00 to £2.16 range and bank the profits when we see a 10%-20% uplift on these prices. Speaking with a couple of travel experts at the weekend, business travel bookings are still "dead in the water" and retail is coming back, although very limited flying schedules are in place, much lower than usual capacity, despite that fact that destinations to more countries are now available. I'm now waiting for the poor Q2 and HY1 results to be announced before buying back in for the long-term, as I see a fall to £1.70-£1.80 when these are announced, and so I can maximise percentage growth on my investment.