BOI shares steadily rising... Worth a punt?

TTNYWWBM

Doh! u r right, Idu – I clicked the wrong post I was thanking rugby man for sayin he liked reading my posts!

I would agree with RonByrne in so far as to say, "If it's round it rolls" to quote my Grandpappy. There was most likely 'words in ears' at certain stages of the BOI/AIB trading in the past few months, not only in spread betting but clairvoyant large pre-emptive sells and 'uncanny predictive' trading every now and again. But hey if we think the old boys network doesn't exist anymore we'd be a bit naive?

You might think so, but I couldn't possibly comment...

Spiritoftheseventies

those bank of ireland shares are as good as dead. I was burnt by the eircom share debacle and they still send me on dividend cheques for embarrasing amounts. last one was two euros i think!

TTNYWWBM

bayviewclose wrote: »

those bank of ireland shares are as good as dead. I was burnt by the eircom share debacle and they still send me on dividend cheques for embarrasing amounts. last one was two euros i think!

Eircom is Eircom BOI is BOI

Close up, faaar away... Close up, faarr aawwaaay. do u get it now Dougal?

Spiritoftheseventies

TTNYWWBM wrote: »

Eircom is Eircom BOI is BOI

Close up, faaar away... Close up, faarr aawwaaay. do u get it now Dougal?

careful there!

Block (8

ixus wrote: »

Expect riots by year end. I do.

hehe why do sagely people all talk like yoda

sorry can't help myself please don't ban me

johnmarkgriffin

bobbbb wrote: »

I use this cool think called the internet. Instant news updates. FT.com is very quick with the news.

The markets react within seconds of a news story breaking so unless you've got direct market access and a bloomberg terminal don't day trade. you WILL lose money in the long run.

TaxiManMartin

johnmarkgriffin wrote: »

The markets react within seconds of a news story breaking so unless you've got direct market access and a bloomberg terminal don't day trade. you WILL lose money in the long run.

bobbbb wrote: »

I have access to a bloomberg machine.

Ive started using paddypowertrader more and more.

You'll see the prices updated to the minute on your account anyway.

Im not trading today though. I only do this when there are big movements or big news that i know will be in my favour. Today, even though its going as i expected, its just too tight for comfort.

Looks like he does.


Very hard to tell whats coming next, but the last few times the banks went this low they shot up the next day.

pirelli

TaxiManMartin wrote: »

Looks like he does.


Very hard to tell whats coming next, but the last few times the banks went this low they shot up the next day.

I hope they do, i am anxious that the markets might be forming a a second slump. While this would be good to play the short ETF, i would have to take a hit on my profits to loosen up cash and i am hoping we see a strong comeback so that i don't have to do that.

TTNYWWBM

I'm the first to admit I'm wrong when I'm wrong, jeesh I never would have thought BOI would fall to 1.41 at closing today. IMHO My calculations still say that BOI is worth 1.55 adjusted to 1.60ish as outperform as cost cutting measures should result in nice adjustments to the balance sheet in coming weeks. Currently a share that's trading below fair value. So IMHO a buy at anything less is a bloomin steal!

Doh! I was incorrect on NAMA draft legislation being passed, the 'HEADERS' have been passed, the actual draft will be passed in Sept 09, then loans can be transferred and a % of the loan value paid to the bank in bonds. (Currently these loans can not be used as collateral any more, so govt bonds that can be used as collateral will benefit the banks profitablity, as they can borrow money against these bonds, and use it for profitable loans.)

Davy rated BOI to 'outperform' status yesterday, even though the price falls due to profit taking, er well remember for every seller there's someone buying!

Davy's ultra comprehensive report on Irish banks released on the 6/7/09 stretches to 16 pages...
Basically covers the following, I can't add the actual report as it's copyright and only available to Davy clients.

Banks - Time to contemplate a tougher line on costs...
• Draft NAMA legislation is expected in September 2009,
paving the way for 'cleansed' Irish banks – free from
the weight of their 'toxic' property loans. The
next step in the process is to restore our post-NAMA
'cleansed' banks to profitability – a critical move if
they are to help kick-start the Irish economy.

• Costs are a key component of earnings power. As
declining revenues look set to take a heavy toll, we
look at the option of more aggressive action on costs
against the backdrop of what is happening in the Irish
private sector generally and peers' average staff costs.
Bank staff and/or pay cuts should be considered

• Current pay negotiations that centre on pay freezes do
not appear to go far enough, falling very far short of
the much drawn-on Nordic experience.

• Investor focus is moving increasingly from TNAVs to
banks' potential earnings power. Costs are clearly a
key driver and are easier to influence than revenues.

• Our post-NAMA earnings for 2011 assume that
operating profits begin to recover from (predicted) 2010 trough
levels and put Bank of Ireland (BKIR) on a 2011 P/E
of 4.1x with Allied Irish Banks (ALBK) on 5.9x (both
before any possible rights issues). (Currently) We rate ALBK
'Neutral' and BKIR to 'Outperform'.

IMHO as I stated in earlier posts, BOI's (and indeed AIB) will fluctuate in a normal days trading but its average gain on the next leg up, I think will be a slooow gain back up, as when NAMA is passed it will still be near the end of the year by the time loans will be transferred etc.

I reckon if you're looking for a quick buck, forget BOI/AIB, but a buy now should appreciate slow and staedy in the coming months, of course as before with the expectation of NAMA the price will become inflated again on the run up in Sept., trusting that the price has now fallen as low as sanity will allow?

rugbyman

thats a new concept around here TTNYWWBM, admitting you were wrong.
most who get it wrong lie low for a while.
Regards;Rugbyman

pocketdooz

TTNYWWBM wrote: »

I'm the first to admit I'm wrong when I'm wrong, jeesh I never would have thought BOI would fall to 1.41 at closing today. IMHO My calculations still say that BOI is worth 1.55 adjusted to 1.60ish as outperform as cost cutting measures should result in nice adjustments to the balance sheet in coming weeks. Currently a share that's trading below fair value. So IMHO a buy at anything less is a bloomin steal!

Doh! I was incorrect on NAMA draft legislation being passed, the 'HEADERS' have been passed, the actual draft will be passed in Sept 09, then loans can be transferred and a % of the loan value paid to the bank in bonds. (Currently these loans can not be used as collateral any more, so govt bonds that can be used as collateral will benefit the banks profitablity, as they can borrow money against these bonds, and use it for profitable loans.)

Davy rated BOI to 'outperform' status yesterday, even though the price falls due to profit taking, er well remember for every seller there's someone buying!

Davy's ultra comprehensive report on Irish banks released on the 6/7/09 stretches to 16 pages...
Basically covers the following, I can't add the actual report as it's copyright and only available to Davy clients.

Banks - Time to contemplate a tougher line on costs...
• Draft NAMA legislation is expected in September 2009,
paving the way for 'cleansed' Irish banks – free from
the weight of their 'toxic' property loans. The
next step in the process is to restore our post-NAMA
'cleansed' banks to profitability – a critical move if
they are to help kick-start the Irish economy.

• Costs are a key component of earnings power. As
declining revenues look set to take a heavy toll, we
look at the option of more aggressive action on costs
against the backdrop of what is happening in the Irish
private sector generally and peers' average staff costs.
Bank staff and/or pay cuts should be considered

• Current pay negotiations that centre on pay freezes do
not appear to go far enough, falling very far short of
the much drawn-on Nordic experience.

• Investor focus is moving increasingly from TNAVs to
banks' potential earnings power. Costs are clearly a
key driver and are easier to influence than revenues.

• Our post-NAMA earnings for 2011 assume that
operating profits begin to recover from (predicted) 2010 trough
levels and put Bank of Ireland (BKIR) on a 2011 P/E
of 4.1x with Allied Irish Banks (ALBK) on 5.9x (both
before any possible rights issues). (Currently) We rate ALBK
'Neutral' and BKIR to 'Outperform'.

IMHO as I stated in earlier posts, BOI's (and indeed AIB) will fluctuate in a normal days trading but its average gain on the next leg up, I think will be a slooow gain back up, as when NAMA is passed it will still be near the end of the year by the time loans will be transferred etc.

I reckon if you're looking for a quick buck, forget BOI/AIB, but a buy now should appreciate slow and staedy in the coming months, of course as before with the expectation of NAMA the price will become inflated again on the run up in Sept., trusting that the price has now fallen as low as sanity will allow?

How exactly do your calculations come to 1.55 - 1.60?

Why would cost-cutting measures make any difference to a balance sheet in a couple of weeks?

Then loans can be transferred? Before any loans are transferred , decisions need to be made on the haircut these loans will take. There is no appropriate benchmark and thus it will be some sort of DCF calculation based on anticpated rental yields or something similar. But what about the greenfields? This process will take much much longer than you think and undoubtadly, a combination of the banks and the government will f**k it up royally. They say they want to have it done by fiscal year end which for Anglo I believe is Sep 29th so they want to revalue Anglo's whole loan book accurately in the next 10 week?? Give me a break . . .

Davys rate them outperform - enough reason to short them IMO

Ultra-comprehensive reports are not 16 pages long - they are 200-300 pages long. Short synopsis reports on a whole industry are 16 pages long.

Your input is thorough but I have to disagree with your view on this industry. I think I remember you quoting Newcourt and INM as two of your outperformers and that you trade for a living yourself at home? Taking on this much risk must be heart-wrenching . . .

If you would like to PM me that Davys report that would save me the hassle of looking for it here . . . . Maybe that will change my mind.

silverharp

I just think you cant trade Irish banks using company specific data alone. Over the next 4 or 5 months the movements in the Global indexes will determine the direction of the Irish Banks , and from my perspective thats a near certain fall bewteen now and Nov.

TTNYWWBM

Comprehensive by Davy's Standards Comprehensive is the wrong word I suppose, I meant extremely detailed report.

Pocketdooz - don't shoot the messenger!
Whoooah there, INM I don't think I ever recommended that?
Newcourt, oh don't mention the war! :rolleyes:

pocketdooz

Moody's downgraded the guaranteed debt on 6 Irish banks yesterday to Aa1from Aaa which follows the downgrade of the Irish govt rating last week. The move impacts AIB, BKIR, Anglo, EBS, IL&P and Irish Nationwide which are all under government g’tee. Moody’s also downgraded the long term deposit ratings of AIB and BKIR by a notch to A1, and of IL&P by a notch to A2, reflecting the weakened ability rather than willingness of the Irish govt to support banking system in any extended way.

Spiritoftheseventies

just an idea but given the subject of the thread, maybe would be a good idea to update value of BOI shares every once in a while. big question. will they ever return to anywhere near their peak value.

daveirl

This post has been deleted.

pocketdooz

daveirl wrote: »

This post has been deleted.

My God

pocketdooz

bayviewclose wrote: »

just an idea but given the subject of the thread, maybe would be a good idea to update value of BOI shares every once in a while. big question. will they ever return to anywhere near their peak value.

Define 'ever' . . . .

I doubt they will return to their peak in real terms in the next ten (ish) years.

daveirl

This post has been deleted.

pocketdooz

daveirl wrote: »

This post has been deleted.

I know

But that is just ridiculous

alfa beta

Hi All

Long time reader. First time poster so bear with me.

Good thread this one.

I've made a nice few quid over the last few months across BOI / AIB and ILP. And I've been reading posts here with interest and now I've decided to throw in my own opininon and see what people think.

Personally I wouldn't touch an Irish Bank share at all over the next few days/weeks. I think the recent rally from the lows in March was based on nothing more than a wee bit of demand created by small people like me who thought 'If I buy in now at 30 or 40 or 50 cent the only risk I'm really taking is that of possible nationalisation - so it's all or nothing' (march/april) followed by 'look a sustained upward trend - it might just be time to jump on the bandwagon' (April/ May) followed by a realisation that nothing had substantially changed since march and now (June) might be just the time to take profit....followed by more mentions of nationalisation by the IMF etc....followed by (July) 'hey if I cash in now at 1.60 I still make xxx - not as good as a month ago but I'm still up....followed by, well, the current downward trend....which I personally believe is set to continue for a while.

How low??? Who knows? Will AIB and BOI go back under a euro - why not? Will they go back to the lows of March....hard to provide any definitive reason as to why this won't occur. On the other hand, will they go up in the short term? Well they might - but I see no reason right now as to what an upward trend might be based on.

Couple of points i'd make:
1. It's very very very hard to read anything into balance sheets etc at the moment. It's almost pointless too because of the next point.
2. The spectre of nationalisation is continually hanging over the banks (AIB and BOI) and as long as that remains the case no serious investor is gonna come anywhere near them. Which means the share price will be fickle, volatile and low - and based almost entirely on the actions of small private investors / traders.
3. NAMA is a political strategy as much as an economic one and this in my view seriously impacts on the whole investor dynamic - ie: will bank shareprices be intricately linked to fianna fail support levels from now on....I think anyone buying into the banks should keep a very close eye on election possibilities etc - but that's a pretty obvious point i guess.
4. Regardless of politics, will NAMA work. The lack of a clear, definitive strategy is worrying and this in my view has played no small part in the banks going from recent highs of 2.10 - 2.20 backdown to the 1.50 zone.

I may be completely wrong (and I'm sure plenty people will point this out if so!!), but right now I believe AIB and BOI will sink further and may approach their previous lows over the next few weeks. (Personally I wouldn't buy back in to either until substantially under a euro - and with more reassurance from the govt that nationalisation isn't an option). Not so sure with ILP - find it harder to follow/guess the trends in this case - but might be tempted at about E2 (only tempted!)

To be honest, any future investment I make will be based on a mixture of gut instinct, reading the news, following trends and trying to figure out what other people are thinking. It's probably closer to a poker playing strategy than an investment one. But people do make money playing poker - so it's probably not the worst analogy in the world.

Problem is they also lose money!!

Note: having just written the above I checkced prices and BOI have jumped about 5% today - who knows, maybe I'm just a natural pessimist!!

WarrenMuppet

Hi AlphaBeta,

That was a great post.....seems like you were bottling all your thoughts up until now. I've been thinking the exact same things as I've dipped in and out of AIB/BOI in the past number of months. I'm keeping well clear at the moment as my gut tells me they've run out of steam, as the whole rally has been based on nothing that I can see. When/If they move clearly out from under the shadows of Nationalisation then I think it will be all go from there.

W.Muppet

lucky-colm

lol
i see you joined especially to say your piece alpha
interesting first post

ranger4

We could see aib-boi sp heading back to 1.00euro region fairly soon with no possitive news on the horizon and bearish sentiment set to continue, Waiting game now for nama details.

TTNYWWBM

Jaeny Mack! Ranger4 I have to agree with you!

I might be a bit 'jumpers for goalposts' on this, but gone is the day when share trading was about a company's performance, and real business ffs!

I'm convinced the Irish bank share prices has no relation to the fekin company's balance sheet, almost totally driven by punters!

Sure a s**t off a shovel it will continue tumbling... In a sane market BOI and AIB would not be trading near their TNAVs. You'd think they were going out of business the way they have been trading the last few days.

Personally, perhaps nearer to nama or if the price falls back to a very low level I'd buy but only on a punt of a few k. But the bank shares are prob going to be in bear for a long time...

---

Before you all jump on my neck, yes I know their Q2 results are s**t. Nama has been delayed and inflated the sp yada yada...

alfa beta

mid 1.30s today for both AIB and BOI - bigger drop than even I thought!

we looking at sub 1euro by tue/wed next week?? I sorta think so.

don't see any reason for an end of week rally later today (friday) either ....probably just end the week on a wimper.

By the way, anyone got any views as to why Irish Life is a low as it is generally - couple of pluses in my view: 1. banking is only a part of their business. 2. They didn't get carried away by the property development game. 3. They appear to be 'relatively' well capitalised (in the context of the current ec climate n all that). 4. fair enough they've got a fair bit of exposure to the wholesale markets - but still - not in the worst shape as far as I can see.

In fact TT your comment about prices not relating to performance etc - for me that rings true with ILP moreso than with the other banks.

I sorta think it might be a case of 'guilt by association' and that if someone genuinely want's to go long term on a bank it mightn't be a bad bet over the next few months - I'd be tempted to buy at under 2.30 (on an upward swing from close to the 2 euro mark of course). Can't honestly see what's stopping those shares from sitting around the 4 euro mark within the next twelve months. (But to be honest I haven't done much research and would be interested in views here.)

As for the big two - a very interesting summer ahead - and a chance to see how prices perform while politics is on hols. My view, it ain't gonna be pretty. And in the autumn, it might just end in tears....

AB

TTNYWWBM

The following takes place between 08:00 and 10:00...

Share prices fall to 1.24 for both banks!

What in name of Mickey Mouse is going on?

Idu

There's no bullish news so why would it go up? International markets are falling so it's only natural that we would follow suit

daveirl

This post has been deleted.

ranger4

Could see a rise next week with boi-aib sp on back of possitive Q2 us bank earning results.:D

Amigomenor

Fall shall continue. Eventually both banks will go the way of Anglo.

stevedublin

Amigomenor wrote: »

Fall shall continue. Eventually both banks will go the way of Anglo.

betcha €50 you'll be wrong.

Daragh101

how are you so sure???

eire2009

Id say if ya wanna make a few quid in a week or so id buy them today.. 1.20 aint a bad price

pocketdooz

eire2009 wrote: »

Id say if ya wanna make a few quid in a week or so id buy them today.. 1.20 aint a bad price

Why?

ranger4

pocketdooz wrote: »

Why?

BOI sp up over 7% this morn, Could see gain with boi-aib sp due to possible better than expected Q2 us bank results due tommorow and friday. Hopefully boi-aib sp back to 1.50 range by this friday.

AntiRip

ranger4 wrote: »

BOI sp up over 7% this morn, Could see gain with boi-aib sp due to possible better than expected Q2 us bank results due tommorow and friday. Hopefully boi-aib sp back to 1.50 range by this friday.

it's nearly there already ranger4

Idu

ranger4 wrote: »

BOI sp up over 7% this morn, Could see gain with boi-aib sp due to possible better than expected Q2 us bank results due tommorow and friday. Hopefully boi-aib sp back to 1.50 range by this friday.

Or you could see a fall with worse than expected earnings. You're a real glass half full kind of guy!:D

ranger4

AntiRip wrote: »

it's nearly there already ranger4

yep, should be at 1.50 range by thursday, i expect sp to trade in a 1.20-1.40 range untill hopefully hits 1.50+.

ranger4

Idu wrote: »

Or you could see a fall with worse than expected earnings. You're a real glass half full kind of guy!:D

AntiRip

ranger4 wrote: »

yep, should be at 1.50 range by thursday, i expect sp to trade in a 1.20-1.40 range untill hopefully hits 1.50+.

I'm very happy to have bought e3,000 worth of shares last week at e1.17 after that terrible spreadbet!
Should get some of my money back hopefully!

Idu

AntiRip wrote: »

I'm very happy to have bought e3,000 worth of shares last week at e1.17 after that terrible spreadbet!
Should get some of my money back hopefully!

That was lucky you managed to get the absolute lowest price it traded all week

AntiRip

Idu wrote: »

That was lucky you managed to get the absolute lowest price it traded all week

Amazing isn't it. :eek:

Money went through to Davy's last friday Idu and just bought at that time. Maybe I needed some luck Idu. Actually I don't like your attitude really towards my posts so don't reply to me please. Thanks

Idu

AntiRip wrote: »

Amazing isn't it. :eek:

Money went through to Davy's last friday Idu and just bought at that time. Maybe I needed some luck Idu. Actually I don't like your attitude really towards my posts so don't reply to me please. Thanks

Why cos I pointed out the mistakes you were making in an effort to teach you something that would help your trading. Makes sense I suppose. I mean why come onto an internet forum looking for trading ideas if all people are going to do is offer constructive advice. The nerve of some people

And as for your trade on Friday all I said was it was lucky you got the best possible price. Sorry if I should have been applauding you for picking the exact low. I guess that's my problem for underestimating your powers of analysis or psychic visions or whatever it was you used.

I've said many times I'd rather be lucky than good, that was all I was getting at

pocketdooz

Idu wrote: »

That was lucky you managed to get the absolute lowest price it traded all week

Proof or it didn't happen imho

ranger4

Idu wrote: »

Why cos I pointed out the mistakes you were making in an effort to teach you something that would help your trading. Makes sense I suppose. I mean why come onto an internet forum looking for trading ideas if all people are going to do is offer constructive advice. The nerve of some people

And as for your trade on Friday all I said was it was lucky you got the best possible price. Sorry if I should have been applauding you for picking the exact low. I guess that's my problem for underestimating your powers of analysis or psychic visions or whatever it was you used.

I've said many times I'd rather be lucky than good, that was all I was getting at

How is you trading going idu.

Idu

Ok thanks. Why?

eire2009

pocketdooz wrote: »

Why?

Because im the man and I said so. ha:p

ixus

Back on topic Eire.

AntiRip, you have 3 options with posts/posters you don't like.

1.Report the post
2.Place the User on ignore
3.Ignore/Discuss and carry on as usual

pocketdooz

eire2009 wrote: »

Because im the man and I said so. ha:p

Good point. With advice of this calibre you could get a job with Davys :eek: