Lloyds share sale(Right Issue)

captainzorro

Hi,
I currently have 2208 shares valued at £2,099.81

If I take up the share sale offer, then I will need to pay around £1,000. And then to recover all this will take months.

Can I sell my original shares at £2,099.81 now and then wait for the share sale to happen, and then once the share price has hit the rock bottom after share dillution, I should buy them with the monies I have received and then once they go up, I can make a maximised profit.

Would you think that is the right option? I don't know but if anyone could shed their ideas on this?

thanks.

Baz_2

I'm not sure but working out the numbers on the expected price after the issue I have more profit in my shares now than I will should I take up the offer.

It really doesn't give me any incentive to take up the offer especially since you need to stump up nearly 50% of your holding again.

Does any one know the date I have to decide by before the shares dilute? A column in the FT said it was Friday?

I think the share price will drop below the TERP for a few days after, that would probably be your buying opportunity but whether the numbers work out depends on how far they drop and how much you paid for your shares.

Selling just before the dilution date seems to be the time to max the price.

Obviously if you think longer term none of this may apply.

No idea really.

bmunky7

you assume the share price isn't already at rock bottom and that it won't rise quickly after the rights issue. I hold lloyds shares and will be taking up my full allocation of rights. The recapitalisation will make the bank stronger in my opinion and I therefore want to maintain the same % stake of the stronger bank. The issue price is relatively low and estimates are the post issue share price will settle around 60p per share.

Baz_2

bmunky7 wrote: »

you assume the share price isn't already at rock bottom and that it won't rise quickly after the rights issue. I hold lloyds shares and will be taking up my full allocation of rights. The recapitalisation will make the bank stronger in my opinion and I therefore want to maintain the same % stake of the stronger bank. The issue price is relatively low and estimates are the post issue share price will settle around 60p per share.

No sure about the OP but I don't assume anything, that's why I posted I have no idea.

When I run the numbers through at a TERP of 60p I have less profit in my shares than I do now. Plus the fact I have £££ to shell out too means It's not a sure bet I will take them up like it was the last time.

If that's the case, I feel its better to sell the shares before the dilution rather than wait and sell the rights.

ozzage

I feel that long term this company is an excellent bet. Therefore I'll be taking up my full entitlement!

My average price is currently 49p per share.

cardsharps

bmunky7 wrote: »

you assume the share price isn't already at rock bottom and that it won't rise quickly after the rights issue. I hold lloyds shares and will be taking up my full allocation of rights. The recapitalisation will make the bank stronger in my opinion and I therefore want to maintain the same % stake of the stronger bank. The issue price is relatively low and estimates are the post issue share price will settle around 60p per share.

What happened to the last load of money you gave them? And the load of money before that? Wait 12 months and Lloyds will be back looking for more money off you.

cashbackproblems

SO for every share you hold you get another for 37p????

Im thinking of selling tomorrow if the sp hits 97p as i'll have made a small profit and will buy back in when the price falls to 50-60p.

Baz_2

cashbackproblems wrote: »

Im thinking of selling tomorrow........

You me and the rest of the world by the looks of the share price today.