By Malcolm Stacey | Monday 9 January 2017
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Hello Share Baiters. That awful share to hold, Lloyds Group (LLOY) may be getting less arduous. There is some optimism in the City that the current disappointing share price may rise 20% or so to beat 75p. Presently it’s around 66p.
However, we all remember that it wasn’t so long ago that the share price was in the mid eighties, and then we looked forward to £1 a share. Which is still only just out of penny share territory. But then it hit the rocks yet again.
In my humble experience, when a share soars and then retrenches horribly, it will have another go at reaching the heavens again. Maybe that will happen here. But that view isn’t just the kind of wishful thinking that the morons get up to so often on bulletin boards.
All the banks have been putting on share value in the last few months. This is mainly supported by the better than expected GDP figures. And by the fact that interest rates can’t get much lower, and may well rise.
But Lloyds has the added advantage of the acquisition of MBNA, which has some hefty credit card business. Its currently owned by Americans, but has 7 million UK customers.
You’ll have noticed that credit card operations do no seem constrained by low bank rates, in that borrowing on your card is still pretty expensive.
The government still has a 7% wedge of Lloyds Bank. But it used to be a lot higher and it seems that it has been selling the shares, without this dumping operation having much effect, if any, on the share price.
Lloyds Bank pays a dividend, which RBS does not. So you could buy the shares and still make some money, while waiting for that share price to become more respectable. But it is a bank, so beware of possible whammies around the corner.
See you in the Punter’s Return tonight?
Never miss a story.
This area of the ShareProphets.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ShareProphets.com. ShareProphets.com does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ShareProphets.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ShareProphets.com and is not intended to be relied upon by users in making (or refraining from making) any investment decisions.
Comments are turned off for this article.
Search ShareProphets |
Stock market news |
Recent Comments |