Rangers FC Shares

garybarlowsbeard

Some interesting points. I should have made one thing clear - I'm well aware it would be a risky investment. I'm quite young (I think!) and looking to invest a small amount every few months in high risk shares. As said, I don't know too much about shares, nor Rangers in particular, which is clearly not the best basis for investment.

Aside from the fact these are tipped to me by a vaguely trusted friend, my logic is thus:

Rangers are 99% certain to be playing in the SPL in 28 months.

What would their price be then?

The only likely barrier to that is administration.

Surely they won't make the same mistakes again!

===============

Admittedly, that last statement might be optimistic. In terms of the quality of the players and size of wages, I believe that's because you can't have a squad solely equipped for the division you're in, nor a manager, if you intend/expect/hope to have three consecutive promotions. There has to be a lot of thought to the future.

eskbanker

garybarlowsbeard wrote: »

Aside from the fact these are tipped to me by a vaguely trusted friend

His name wouldn't happen to be McCoist would it?!

I must confess to not being an experienced investor in equities but my understanding was that share prices will typically already factor in widely-available market knowledge, so in the case of Rangers the price will already reflect the probability that they'll be back at the top level soon, i.e. it's unlikely that it'll be feasible to outsmart the market by seeing this as a bonus that'll increase their value....

And just to be pedantic, it's actually more likely to be 16 months before they're in the top division and it's no longer the SPL but the Premiership division of the SPFL after league reunification last year!

planteria

garybarlowsbeard wrote: »

Some interesting points. I should have made one thing clear - I'm well aware it would be a risky investment. I'm quite young (I think!) and looking to invest a small amount every few months in high risk shares. As said, I don't know too much about shares, nor Rangers in particular, which is clearly not the best basis for investment.

Aside from the fact these are tipped to me by a vaguely trusted friend, my logic is thus:

Rangers are 99% certain to be playing in the SPL in 28 months.

What would their price be then?

The only likely barrier to that is administration.

Surely they won't make the same mistakes again!

===============

Admittedly, that last statement might be optimistic. In terms of the quality of the players and size of wages, I believe that's because you can't have a squad solely equipped for the division you're in, nor a manager, if you intend/expect/hope to have three consecutive promotions. There has to be a lot of thought to the future.

im not clued up on Rangers, but in theory the club could be back in Scotland's top division but with a different ownership structure. there could be a share split, for example. if the business is in a mess, there could be changes made which impact negatively upon the existing shareholders between now and them reaching the top division. you need to do some serious research of your own...forget about the vague chap altogether.

garybarlowsbeard

I agree with:

"my understanding was that share prices will typically already factor in widely-available market knowledge, so in the case of Rangers the price will already reflect the probability that they'll be back at the top level soon, i.e. it's unlikely that it'll be feasible to outsmart the market by seeing this as a bonus that'll increase their value...."

But maybe many people are sticking with the "football is a bad bet" theory.

The different ownership structure is a thing i had considered too and does worry me and i dont know how that would work. In short, I don't know much about this! It's clearly a risky one.

PeacefulWaters

Football is rarely a good bet.

Rangers strikes me as an insane bet.

The almost guaranteed promotions will leave the business with an absolute need to increase their already bloated cost base exponentially.

If it became a cash cow all that cash would get spent on new playing staff. Not paying shareholders healthy dividends.

Radiantsoul

To be worth even £19m they ought to be making around £1-3 million in profit a year, not losing £1 million a month.

garybarlowsbeard

But they have huge assets I think, in terms of the ground and training ground? and fundamentally the business is more or less identical to celtic (maybe?!) which is worth £50-£60m. All about the brand and the fact that inside 3 years they could easily be in the Champions League.

Just to make it clear, I'm not ignoring what everyone is saying and I'm not certain to buy these shares, just throwing ideas around.

eskbanker

Re size of asset base, you might be interested in http://www.bbc.co.uk/news/uk-scotland-scotland-business-24359693:

A final observation on these accounts. They give a valuation on the value of the Rangers business. You'll surely recall that Charles Green led a buyout of the assets for £5.5m last year. Some thought he was getting it for far too little. But you have to remember that any asset is only worth what someone will pay for it on the day it's sold, and no-one else was willing to compete with Charles Green's offer.

With some professional valuations, Rangers now reckons that the club's worth a bit more than £27m. While Ibrox and the Murray Park training ground would cost £79m to replace, their market value is put at £6.5m, with player registrations at £3.6m.

But while fans are willing to spend on it, it's the Rangers brand that's worth most. With a valuation of £16m, it's what the auditors describe as an asset with "an indefinite useful life".

McCoist has also been (mis)quoted extensively in recent days as saying that they need something like £30m of investment to get back to being competitive with Celtic for Champions League places, see articles such as http://www.telegraph.co.uk/sport/football/scottish-football/10640276/Ally-McCoist-says-Rangers-need-30m-to-revive-the-glory-days.html

planteria

http://www.bbc.co.uk/sport/0/football/26269789

planteria

http://www.bbc.co.uk/sport/0/football/26321268