BOI shares steadily rising... Worth a punt?

draiochtanois

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BenEadir

draiochtanois wrote: »

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Here's my take. If I take the lowest NAV of 85c and discount that by another 50% to 42.5c I'm still buying into the bank (at 8c a share) at an 80% discount to it's breakup value.

I just think there is an understandable but, in the cold light of day, unjustifiable negative market sentiment to bank shares, especially at these levels of valuation. So many people have been burned on the way down and there have been so many false dawns at values much higher than 8c that it's almost persona non grata to even suggest that investing in bank shares is a good idea but remember what the sage of Omaha also said "be fearful when others are greedy and greedy when others are fearful"

If BOI survived the storm of the last 3-4 years the worst, in my opinion, is over and it will survive another 100+ years given the regulatory shackles put on the activities banks will be allowed to get up to in the future.

If the above is true then what if any downside is there to buying in at 8c? Does anyone really think the share price won't be >80c in 2016?

I'm convinced now is the time to bale in so that's exactly what I'm doing.

Ben

draiochtanois

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Idu

Raskolnikov wrote: »

The rights issue will have 22 billion shares issued at 10 cent.

Subsequently, bondholders will be offered the option of getting 10% cash on their bonds, or 20% worth of the value in equity. I imagine that most will chose equity as it means they can sell them instantly and get more than 10% that they would be taking cash. €2.6 billion of unsubordinated debt means another 52 billion shares will be issued. Assuming the current 14 cent share price and 79 billion shares issued, that gives us a market cap of €11 billion. Given that excluding costs of NAMA and writedowns from loan losses, Bank of Ireland made €1 billion last year, that essentially means they're trading at 11 times cash flow, not cheap at all.

When you strip out all this dilution, the current Bank of Ireland share price is actually trading at levels that aren't a million miles off that.

2007: 1 billion shares outstanding at €17 gives a market cap of €17 billion.
2011: 79 billion shares outstanding at €0.14 cent gives a market cap of €11 billion.

When people like ranger talk about the share price going to 40 cent, they are implying a share price of about €30 billion. That means the market will value Bank of Ireland by nearly twice as much during the bubble of 2007.

This was posted months ago but most people ignored it. It would take one hell of a turnaround for this share to be trading at 80c a share in 2016 barring a reverse stock split of course

BenEadir

Idu wrote: »

This was posted months ago but most people ignored it. It would take one hell of a turnaround for this share to be trading at 80c a share in 2016 barring a reverse stock split of course

This evenings closing price is €0.076 & Bloomberg states the market cap is €2,290,070,000 (or thereabouts) which implies there are 30,132,500,000 (or so) shares in issue not 79,000,000,000.

It also implies the PE (per your basis of calculation above) is approximately 2.3

What an I missing?

Ben

SGKM

Ben, I used the exact same logic as you when I bought in a couple of months ago at 9.5c, I firmly believe that buying BOI isnt an investment in a company, it's a bet on the success of the Irish economy. In my view all traditional valuation metrics are out the window, the correlation coefficient between BOI's future earnings and Irish economic indicators is probably 1.

If the Irish economy experiences positive growth over the next 2 -3 years, resulting in lower unemployment then impairments from both corporate and personal loans / mortgages will gradually reduce, the property market will stabilise, funding costs will drop and net interest income will increase therefore resulting in the bank returning to profitability.

The big issue is that there are so many factors affecting the Irish economic outlook. I firmly believe that at this point in time BOI is a good "bet" but that may take years to payoff. At this point in time it looks like it will pay off... the only question is how long will it take?

BenEadir

draiochtanois, I understand your thinking but I'm a bit of a natural contrarian so here's my thoughts on your thoughts

draiochtanois wrote: »

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Buffet acknowledged he got in at the wrong time. He thought the impairment situation was fully disclosed/understood and obviously it wasn't. Shame on him but more so shame on our banks and regulator for not providing fully early transparency. Since then there has been a number of stress tests and a full re-capitalisation. If anything we are probably now over estimating the potential downsides hence I believe now is the time to get in. Buffett also bought into oil (Conoco??) when crude was near it's $150 peak (or thereabouts) and lost his shirt. He misjudged that one also but these two bad decisions are heavily outweighed by all the decisions he gets right. Everyone's allowed the odd Mulligan!!

draiochtanois wrote: »

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If BOI hadn't already been baled out I'd agree with you but the simple reality is the bad loans have been cleared out (or are in my opinion at least fully factored in), the bank has been re-capitalised and the country will always need at least one strong bank. BOI is it.

draiochtanois wrote: »

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Two things there. 1. If the same circumstances were to happen again I don't believe the Fed would allow another systemic bank to fail. The consequences outweigh the costs of rescuing it. BOI is Irelands systemic/pillar bank. 2. If the government were prepared to let it go it would have done so a long time ago. That horse has bolted.

draiochtanois wrote: »

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Will do. Bought in this morning at 7.79c so I'm on the roller coaster.

Ben

draiochtanois

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BenEadir

Cheers draiochtanois, I do appreciate your and other peoples input as serves to counter balance my own personal bias

Only time will tell whether I made the right decision.

I see the price just hit 8.0c - yipee

My positive sentiment is driving the market :rolleyes:

Think bridge and there'll be a bridge

Ben

Soulja boy

The fact of the matter is we simply don't know. The bad debt and realestate crash exposed pockets of investments on the banks part.

Are these landmines out of the way? Even if they knew BOI wouldn't be telling us.

We are not entirely sure we wont see another worldwide slump with the banks let alone BOI.

As it has been said, if the economy returns to form and there are no more hiccups the bank will start to raise again but it is in no way an investment, it is a gamble that could go either way.

BrokenArrows

What happens to the shares you own if a the bank does go under. Does the price of a share ever reach zero.

draiochtanois

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beagle001

I can`t understand the fascination with Irish banks,they have repeatedly lied to their shareholders and the general public about the financial stability of the organisation and most of the senior management is still in place.
This to me should be reason enough to steer clear of such a company,proven disception and reckless practices.
What makes people think this will change anytime soon,there are far better investments at a similar price on many markets both emerging and traditional.
Your better off going into the bookies and putting the lot on a horse,people who think Ireland will make a quick recovery in 2-3 years must have some very positive data in their drawer as the future is very bleak increasing unemployment,where will these jobs come from?
Look through this thread and see how many have been burnt and if you feel lucky put it all on BOI but my opinion it has not a hope in hell of making a recovery in 5-10 yrs without further dilution of the share or full state control,its still on life support with many a booby trap waiting to be detonated,we just do not have the full picture.

Dapos

Hi All,

I was thinking of putting a bit of money into BoI. About 1000, just as a more riskier investment. But am I just throwing away money. I saw the last post saying there isn't a hope in the bank recovering in the next 5-10 years.

I'm not very clued into investing (very much a newbie) but i do think (and hope) the irish economy will recover a but in the coming years so do people think BoI will be around?

I guess the share prices are so low for a reason but i still wonder...

Any thoughts appreciated.

TheInquisitor

It is a very risky investment. There is a strong possibility of loosing money. I put in £1000 into them on thursday. This money while important to me is not material to my living and i am going to be putting similiar amounts into more shares. I got in at 7.3 cent. They dropped to 6.9 cent and are now up to 8.3 cent .

So while im making a paper profit now i dont know if i will be tomorrow. They were up 12% today and could be down the same tomorrow. The reason i invested is i watched the charts and believed they had hit a floor. I think i could make multiples of my investment by investing now when the world is falling down. Also i thought it very enouraging that Wilbur Ross invested billions in bank of ireland and at a price a lot higher than 7 cent!

shanemort

Dapos wrote: »

Hi All,

I was thinking of putting a bit of money into BoI. About 1000, just as a more riskier investment. But am I just throwing away money. I saw the last post saying there isn't a hope in the bank recovering in the next 5-10 years.

I'm not very clued into investing (very much a newbie) but i do think (and hope) the irish economy will recover a but in the coming years so do people think BoI will be around?

I guess the share prices are so low for a reason but i still wonder...

Any thoughts appreciated.

Go have a look at some of the stocks on the aim, some little gems there goina blow over the next 12/24 months, I'm over there with CNR.L REM.L ORE.L EDL.L AMC.L , I think cnr,ore+ AMC are hopefully goina gain serious traction by this time next year I hope to have x 5 my investment at a min

Dapos

shanemort wrote: »

Go have a look at some of the stocks on the aim, some little gems there goina blow over the next 12/24 months, I'm over there with CNR.L REM.L ORE.L EDL.L AMC.L , I think cnr,ore+ AMC are hopefully goina gain serious traction by this time next year I hope to have x 5 my investment at a min

Thanks for the tips. Any reason why you think u'll get x5 investment?

TheInquisitor

shanemort wrote: »

Go have a look at some of the stocks on the aim, some little gems there goina blow over the next 12/24 months, I'm over there with CNR.L REM.L ORE.L EDL.L AMC.L , I think cnr,ore+ AMC are hopefully goina gain serious traction by this time next year I hope to have x 5 my investment at a min

You literally couldn't risk your money more by investing in shares like these. They have no income. They are often 5 years plus away from making any income. They keep issuing shares thereby diluting your investment and often go bust. I mean i had a look at 3 of the shares turnover today. And all 3 of the ones i looked at had share turnover of less than 30k!

shanemort

TheInquisitor wrote: »

You literally couldn't risk your money more by investing in shares like these. They have no income. They are often 5 years plus away from making any income. They keep issuing shares thereby diluting your investment and often go bust. I mean i had a look at 3 of the shares turnover today. And all 3 of the ones i looked at had share turnover of less than 30k!

You are entitled to your opinion, but put CNR in your watch list and talk to me again after Dec 2011 and Summer 2012 and see who is laughing then.

IMO you are much better throwing your money down a toilet than putting in into BOI, the shares on AIM im in are startup exploration companys and once they get what they want they will be sold, i'm aware of the risks that 50% of them will fail BUT the other 50% should take off to the MOON.

Have a lookaround iii.co.uk CNR Disscusion board and have a read of anything ticked up more than 3 votes for the fully potentiol

shanemort

Dapos wrote: »

Thanks for the tips. Any reason why you think u'll get x5 investment?

Some info on CNR. - Fully funded for all thir drilling and esploration, A Bank invested £3m funding @ 9p a share, So if they got that there must be a return for the bank in it! Any spare cash i can find each month i'm buying more at any price under 9p

Good Luck and always do your own Research.

www.iii.co.uk and www.lse.co.uk are great Fourms and Chat Boards on differant shares.

Some Good News this morning also

http://www.proactiveinvestors.co.uk/companies/news/34031/condor-resources-takes-full-control-of-la-india-concession-after-b2gold-asset-swap-amendment-34031.html

1. Circa 9,600m of the current 20,000m drilling programme at La India has been completed. Assays have been received for the first 7,197m so we are waiting for further results from eight holes (including the first of the deep holes) that could at any time.

2. The 1800m 'deep drilling' programme is now well underway and assays are pending. We may receive the game changing news that the boiling zone has been hit at a depth of 300m and also that seven other veins not currently in the resource have been intercepted as planned (we know from a previous RNS that the California vein (which does not have surface expression) has been intersected by this drill hole on its way down to the boiling zone and produced an encouraging assay result of 3.4m @ 3.24 g/t). This first hole may demonstrate that the resource can be significantly increased.

3. A fourth drill rig is expected on site next week.

4. The Tau report is due to be published 'imminently' according to Pacific Rim. Hopefully, that may regenerate some interest in Condor's 1.1 million oz of JORC in El Savador, where for the time being there is an ongoing moratorium on mining.

5. All the Russian data relating to Mendoza has been added to SRK's 3-D model some time ago. MC could therefore ask SRK to release the 205,000 oz + of JORC Indicated/Inferred at any time. This data will also help to link CNR's recent drilling on the Tatiana vein where the vein passes from La India into Mendoza with the old Russian data to create a complete resource block to add to the JORC total. The 205,000 oz will also take CNR past the 1 million oz of attributable gold in La India District - a significant milestone

6. A maiden JORC for another of CNR's concession areas in Nicaragua, Rio Luna, could come at any time. The old drilling and trenching data done by a previous explorer is currently with SRK. The 6250m of drilling and 7000m of trenching should produce a resource to add to the Nicaraguan total.

7. Once a Nicaraguan site visit has been completed we can look forward to the first broker's valuation note from Ocean Equities Ltd.

8. We may hear whether B2Gold have decided to contribute towards the cost of the drilling programme or face dilution.

9. JORC upgrade (to add to the 1 million oz already to JORC in La India) by the 31/12/11 at the latest. This will include the results from all of the drilling completed (with assays back from the labs) since the commencement of the 20,000m programme at the end of January.

10. During Q4 we can also expect to receive results from the re-testing of the Zopilote adit which was recently re-opened and also we may hear that an adit driven on Mendoza has also be re-opened for the same purpose.

11. I also hope that MC can negotiate the sale of either Estrella or Potrerillos, or preferably both. This was strongly hinted at in a recent note from Ocean Equities. It would make sense to capitalise on some of our assets in order to fund the ongoing exploration work at the flagship La India District and thereby keeping share dilution to a minimum.

Idu

shanemort wrote: »

A Bank invested £3m funding @ 9p a share, So if they got that there must be a return for the bank in it!

Because we know banks only make good investments?

Idu

TheInquisitor wrote: »

They keep issuing shares thereby diluting your investment

So did BOI

shanemort

Idu wrote: »

Because we know banks only make good investments?

This is in the last year, Banks are nowadays over cautious of what they do, so they must have seen the full potentional.

Anyway, im off to work, im not telling anyone what to do or anything, Im mearly saying have a look at them and see if they are right for you,

I sleep sound at night knowing that next year hopefully i will be a very happy bunny.

martyoo

Hi Dapos,

Don't listen to Shane. The vast majority of those AIM listed shares are complete dogs.

• They get pumped and dumped the whole time
• Have huge operational costs
• Lost money
• Dilute shareholders.

Stay clear!

shanemort

Thats funny becuase the below looks like BOI to me??

• They get pumped and dumped the whole time
• Have huge operational costs
• Lost money
• Dilute shareholders.

Yes i mad a few K in BOI back in 09 buying at 12p and selling at 60p but those days are gone, I still have about 1k worth of BOI but its away in the bottom drawer somewhere and i hope that they come back around in 5-10 years, But i dont belive BOI are good for a few quid in the next 1-2 years

martyoo

Thats funny becuase the below looks like BOI to me??

I am not saying to buy BOI either I just think it a bit reckless to advise someone with very little experience with investing to buy penny shares.

Monty Burnz

shanemort wrote: »

IMO you are much better throwing your money down a toilet than putting in into BOI, the shares on AIM im in are startup exploration companys and once they get what they want they will be sold, i'm aware of the risks that 50% of them will fail BUT the other 50% should take off to the MOON.

Sorry, but this makes no sense at all. If the risk/reward ratio was as generous as that, the share prices would be a hundred times higher. The fact is that 90% of them will never go anywhere, 9% might grow to become successful businesses, and fewer than 1% will approach 'the moon' or anything like it.

For you to be right, the whole market must be wrong.

TheInquisitor

Just as an FYI iii.co.uk and lse are not discussion boards. As in there is no discussion happening. With EVERY share on there its people trying to push them because they all own the shares. I've seen several times people that are strongly against a share get their comments deleted and banned . Read independent research reports on the companies ...assuming there are any that is! In any case this thread is meant to be on BOI not any other shares. Maybe its time we had a general thread for people to talk about shares they're interested in.

TheInquisitor

I had the fear today. Sold my Petro's that i bought yesterday and i sold my BOI aswell. Overall i ended up 18% on Boi for the week i had them and 10% up on petroceltic. Im hoping they retrace now a good bit and i might look to buy back in.

draiochtanois

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TheInquisitor

So Much for retracing! Why did America have to add so many jobs!?

FISMA

Smcgie wrote: »

What do you guys think, they were 0.12 last week and now they've more than doubled in a week, worth a shot?

By punt, you mean kick, correct? As in ball up the stocks and boot them out the door?

BuzzFish

Great to see these rising as I got in about the 7c mark a few weeks ago but why is this happening now? what are the factors pushing the price on just now?

BenEadir

BuzzFish wrote: »

Great to see these rising as I got in about the 7c mark a few weeks ago but why is this happening now? what are the factors pushing the price on just now?

My view is that BOI are attracting investors for some of the following reasons:-

- The recapitalisation and stress testing is done and/or factored into the price. In fact, if anything it's been over factored in i.e. the ultimate losses won't actually be as bad as the worst case scenario they've provided for in the recapitalisation.
- BOI is a systemic bank and appears (to me at least) to be the stronger of the two 'pillar' banks the govt have pledged to maintain. I think there is almost 0% chance that BOI will fail in a Lehmans/Northern Rock type way. Yes the shareholders may get diluted further but I think it's unlikely.
- Wilbur Ross & Co aren't stupid.
- The impending banking crisis in mainland Europe won't impact heavily on BOI as it isn't very exposed to Greek bonds etc. For once BOI may actually be ahead of the curve in terms of overall recovery i.e. it's already recapitalised and going through a slimming down process. German, Italian and French banks haven't even started.
- If the Euro ends up being devalued through the issuing of €2 trillion of binds (QE by another name?) bank shares provide a good hedge as their liabilities will reduce in value in real terms and inflation will drive future profit recovery.
- BOI should be a bell weather for the overall Irish economic recovery. We may have more to slide on the downside before hitting rock bottom but the long term upside could be very good.

Just my tuppence worth.

BTW my €5,000 at 7.7c is up over 25% as I type

Ben

draiochtanois

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BuzzFish

draiochtanois wrote: »

This post has been deleted.

Doesn't' look like there is too much out of the ordinary here?

Are you still back in Dec 2008?
http://en.wikipedia.org/wiki/Conjunction_(astronomy_and_astrology)#2008

:D

Ideo

Hey, a quick question for all you folks who have bought/sold/are holding bank of Ireland.

Did you use an Irish trading account for transactions or a US based account?

Also, what’s the difference between BKIR listed on the ISEQ and BOI (ADR I think) listed in the NYSE? Is the NYSE ($.80) price comprised of a number of shares @ FX Rate?

Soulja boy

Google finance has some wierd quote on its ticker today
8.30 +7.50 (937.50%)


Other trackers are listing it as up 1% which I assume is the correct value.

Ideo

Ideo wrote: »

Hey, a quick question for all you folks who have bought/sold/are holding bank of Ireland.

Did you use an Irish trading account for transactions or a US based account?

Also, what’s the difference between BKIR listed on the ISEQ and BOI (ADR I think) listed in the NYSE? Is the NYSE ($.80) price comprised of a number of shares @ FX Rate?

Anybody?

neil.p.b

Ideo wrote: »

Anybody?

Ordinary shares aren't traded on the NSYE, but ADRs. These are basically receipts representing ownership of shares. I'm not sure of the current ratio of ADRs:shares, but at anytime between 14.30 and 16.60 multiply the Irish share price by the fx rate (1.38ish) and divide into the American ADR price.

pirelli

The IRE (ADR) Just completed a reverse split. It has been under performing BKIR for some time and is now down 28% today at $5.95. Anyone think there is an opportunity for a rally on the ADR.

Question:

Is the parity between BKIR and IRE favourable for a buy or is the ADR share price too high.

While Bank of Ireland is not a favourite on this forum i still think the ADR offers a potential gap up. Anyone with an opinion please post.

pirelli

pirelli wrote: »

The IRE (ADR) Just completed a reverse split. It has been under performing BKIR for some time and is now down 28% today at $5.95. Anyone think there is an opportunity for a rally on the ADR.

Question:

Is the parity between BKIR and IRE favourable for a buy or is the ADR share price too high.

While Bank of Ireland is not a favourite on this forum i still think the ADR offers a potential gap up. Anyone with an opinion please post.

Jumped back up to $6.80. My broker fecked up my trade. He went short on my account instead of long when i went to sell ( broker assist due to reverse spilt). So when this tanked my account went crazy ..my profits were phenomenal.

So i rang to get them to buy to cover at 5.89 and the dude is like Oh no man! this is a mistake that money is not real. The worst thing was i could have bought shares on the profit at 5.89 using their money except i still needed them to assist with the sell. Then this thing flys back up to $6.70. All i got was a big red loss for broker fee's and not even a thank you for saving their ass.


Such is life...Lesson learned. Back in the red again. :mad:

Bullish

Hi ranger,
Usually after a reverse split, the stock drops check C (nyse) daily chart.
I am unsure why IRE didnt recieve a D at the end for a split stock ?.
Just remember there are trapped longs now in the stock until it trades normally again, Just my 2 cents worth
AIBYY is up 100% in the past week!

pirelli

Bullish wrote: »

Hi ranger,
Usually after a reverse split, the stock drops check C (nyse) daily chart.
I am unsure why IRE didnt recieve a D at the end for a split stock ?.
Just remember there are trapped longs now in the stock until it trades normally again, Just my 2 cents worth
AIBYY is up 100% in the past week!

Reverse splits are never good on short term share price however the even greater issue here is the parity. The message boards quote $5.60 as the parity price between BKIR and IRE or BOI and IRE by calculating the 40 ordinary shares per ADR share.

I am in the dark as to how they got $5.60.

Anyone have any idea?

liammur

pirelli wrote: »

Jumped back up to $6.80. My broker fecked up my trade. He went short on my account instead of long when i went to sell ( broker assist due to reverse spilt). So when this tanked my account went crazy ..my profits were phenomenal.

So i rang to get them to buy to cover at 5.89 and the dude is like Oh no man! this is a mistake that money is not real. The worst thing was i could have bought shares on the profit at 5.89 using their money except i still needed them to assist with the sell. Then this thing flys back up to $6.70. All i got was a big red loss for broker fee's and not even a thank you for saving their ass.


Such is life...Lesson learned. Back in the red again. :mad:

who is your broker? that was very bad form

m.j.w

im interested in buying a few shares in boi for an interest but ive never bought shares before. can someone advise me on how to go about it and it there a minimum ammount I would have to buy?

BenEadir

m.j.w wrote: »

im interested in buying a few shares in boi for an interest but ive never bought shares before. can someone advise me on how to go about it and it there a minimum ammount I would have to buy?

I use these guys http://www.fxcmstocktrading.com. Fill in the application form, wait for account to be approved, deposit money & trade.

AFAIK there is no minimum amount of shares you can purchase but they do have a minimum trade fee of $14.95 so you want that to be as low a % of the overall cost of investment as possible i.e. buying €5,000 worth of BOI shares (at €0.10 per share) + $14.95 in transaction costs adds very little to the cost of each share but if you were to buy €100 in BOI shares the $14.95 would increase the actual cost to you of each share by 14.95%.

Hope that helps.

Ben

BenEadir

So, dragging the previously active thread kicking and screaming back to life - whats been going on with BOI the last 2-3 days? The share price has shot up :cool:

Ben.

BuzzFish

BenThere wrote: »

So, dragging the 2 previously active threads kicking and screaming back to life - whats been going on with BOI the last 2-3 days? The share price has shot up :cool:

Ben.

Greece's pending deal with bondholders may be something to do with it. Not really sure though but according to http://uk.finance.yahoo.com/q?s=BIR.IR Volume today stands at 88,150,168 which is big considering the 3 month average of 32,907,300

ranger4

BenThere wrote: »

So, dragging the previously active thread kicking and screaming back to life - whats been going on with BOI the last 2-3 days? The share price has shot up :cool:

Ben.

SP broke through resistance and is currently riding the global stock wave due to possitive earnings and EU and ECB looking to finaly taking decissions they should have made 3 years previously.