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@LWHL - yep, I am not sure FRC can limp along any longer. Should have been tied off at the same time as Credit Suisse imo. I anticipate big falls again this week with finance sector and FTSE. Probably won't be able to tell how bad Barclays Q1 results have been received!
The SP is broadly where it was at the same time last year. As with last year, there was a sharp drop in February after Y/E results were poorly received. Last year the SP never recovered. The highest it closed out at was £1.73. There is no reason to suggest this year will be any better and we can guarantee that the bank itself will do nothing in terms of imaginative restructuring and shareholder reward to lift the SP. Such is the pessimism with British bank and Barcs in particular, investors are fearful of any Quarter results. Despite the current rubbish SP and high interest rates, I suspect Barcs investors are more likely expecting a drop in price following Thursday's Q1 results, than a rise.
I chip in every now and then when I see posts telling me this stock is way too cheap, without intentionally wishing to rain on anyones parade. But facts are facts. On paper it could be argued the stock has been way too cheap since 2009, but the reality is, the SP has only gone one way since. Apart from a couple of bad years (2011 & 2012) between 2009 - 2015 it was a solid £2.50 stock, that tried, but couldn't get above £3 with any consistency. Since 2016 however (over 7 years!) it has been a sub £2 stock, that has tried, but couldn't get above £2 with any consistency and in actual fact, has probably averaged £1.50 in those 7 years - about where it is now. It probably will touch £2 again in the next 18 months time, but if it does, it will lead to a mass exodus of investors like myself, who thinks that will be as good as it gets and take it as an opportunity to cut their losses. And for those who extol the benefits of buy-backs, please, please, please - tell me what shareholders have gained from the last £3bn+ of buy-backs.
@ab121: £2.70 was last reached on 20/8/2015. I have no idea as to why you think it is likely to reach that again, well before the end of the year, but I am willing you to be right!
@badprophet: Yes, round about £1.90 for me as well, to sell a significant tranche (which will be at a loss). Love it to be this summer, but really am expecting it to be a longer haul.
@badprophet: Yes, round about £1.90 for me as well, to sell a significant tranche (which will be at a loss). L
@PJSmythe: Good advice PJS. In hindsight for me, I played it wrong all those years ago. I bought in big, because everyone was telling me Barcs was dirt cheap. They were wrong, but I accept my mistake. Hold on to your cash until the time is right - which paraphrasing you, seems to be when they are mopping up the 'blood from the streets' i.e. let the fall play out and buy in when you are reasonably certain the share is back in recovery mode. So, not too soon and not too late. I did pick up another tranche at £1.38 to reduce my average, but I am far too exposed to this stock at the moment and need to get out as soon as is practicable.
@ Boonie: I have no objection to investors buying in at around £1.40 taking that view Boonie. But I seriously object to the bank themselves projecting this, to suggest their divs are generous. Hey, why not continue to drive the SP down to £1 and that 9p becomes a whopping 9%! The fact is that over recent years the SP has fallen from around £3 which is typically where your average poster on this site, thinks the SP should be. Many investors will have bought in at £3 (and above). Suggesting the div might go from 7.5p to 9p is not going to impress them. At 9p this is a return of 3% on an investment that has collapsed in value by 55%. That is not impressive.
...hence this mornings drop.
@Belgrano: Total buy backs = £3.2bn. SP at start = £1.82. Current SP = £1.37. Conclusion = money down the drain. Put the cash in shareholders pockets as dividends now!
@ Andrew1987: You misquote me. I said "if " the outcome is the same. We know what the outcome of 2008 was. We don't know what the outcome is here - except that a bank the size of Credit Suisse has toppled and who would have thought that 3 weeks ago. As things stand, the markets are testing for stress. The banks will either withstand such stress or they won't. And if they don't, the outcome and fix is the same - more banks toppling and government intervention. And as things stand, I don't think enough is being done to prevent another bank going.
@Andrew1987: Does it matter if there are differences between the cause of the 2008 crash and what is happening now, if the outcome is the same? Two US banks have gone and a top European bank has gone. Two weeks later, after governments , central banks and the banks themselves have reassured everyone that the banks are in a good place, there is today an absolute assault on the SP of banks - as someone described it, the markets are in 'seek and destroy' mode. If it continues, it seems only a matter of time before the next bank, big or small will go and the downward spiral will gather pace. I said last week, I didn't think the US were doing enough to shore up their mid-sized banks. If the reality is that governments and central banks cannot prevent the market assault, then we wait to see which bank is the next to crack. And if it is one of the majors, such as Deutsch Bank, we are done for, because investors and depositors will take it as a sign that they have been lied to by governments and bankers.
...and there is still one more week for Bailey and Barclays to decide to rub a bucketful of sea salt on this open festering sore of a stock, by cancelling the dividend. I wouldn't put it past them.
@stewart81: Absolutely spot on. The board at barcs could not have worked any harder in eliminating all good reason to invest in their bank and the SP reflects that. The simple acts of retaining the 'Covid' dividend to be paid at a later date, cancelling the proven pointlessness of the share buy backs, and ensuring the over-issuance debacle hadn't happened, could have put £8bn in the pockets of shareholders and built confidence and trust and significantly raised the SP. But I lose count of the number of times I see Barcs at the top of the 'fallers' leaderboard - back there again this morning - and know full well, regardless of any stresses in the finance sector, that this is down to the Barclays board. Utterly depressing.
...appear to be tanking again, with the mid-sized banks FRC, PACW et al seemingly being allowed to 'wither on the vine'. I don't think the global financial sector can begin to recover until calm and confidence is brought to bear on those banks.
Financials have tanked again in US following Powell and Yellen comments. Could be another grim morning tomorrow.
@ atfabricationsbt: With Credit Suisse out of the way, is Barclays now the bank with the worst reputation in Europe? I pity those who have invested in one that is worse! Whilst I take your point - at the time of writing Barcs SP is still falling (and even the big US banks SP is rising today!) but I refer to my post of 9th March. In that I set out my unhappy 10 year experience of investing in Barcs. I pointed out that in that period, the Barcs SP had fallen 41% (NW fell 17%, HSBC fell 13% and Lloyds fell 3%). I said that imo, this did not suggest a potential significant upswing in the Barcs SP as a lot of people have suggested. Rather it indicated a colossal anchor of negative perception and investor trust in the bank, which would see the SP gulf between it and its peers increase. As I now write, the revised 10 year position is Barcs fell 52%, NW fell 24%, Lloyds fell 13% and HSBC fell 26%. Lloyds is seemingly the better option in UK financials. I heard Venkat recently say that Edward Bramson could not have been more wrong in wanting to slim down the investment bank and return reward to shareholders. If that is so, then Barclays needs to start showing it. If it is highly profitable, then use those profits to fairly reward investors and entice investment to boost the SP. I know it is somewhat distorted by recent events, but it is worth noting that when Bramson invested in Barcs, the SP stood at around £2.17! I think Barcs will come out of the current situation intact, but will do so with a big red flag flying. It has to change. It has to be better run and it has to start treating shareholders fairly. If it continues on its current trajectory, with everyone noticing how brittle the SP is against any jitters in the market, whose to say, at some point in the future, it won't go the same way as Credit Suisse?
@badprophet - so long as they don't do another last minute 'covid' on us and cancel the dividend to protect liquidity and capital. I can't see it happening because if it did, the toys would really come out of the pram.
Assuming they get the deal over the line, we'll see tomorrow how the markets react. At least they seem to be acting swiftly and decisively over Credit Suisse. My concern is back in the US. I know First Republic is a lot smaller fry and the banks stepped in last week to patch it up, but it lost a third of its value in one day on Friday and I don't see any kind of urgency to take that one over - but I suspect it might be needed.
As I don't involve myself in it and so don't pay attention to it, there is probably some naivety attached to this question. But to what extent is short selling compounding the problem in the global financial sector? And if it is a significant factor, could it and should it be suspended temporarily? I suspect the answer is that this would completely go against the grain of a free market.