Lloyds share price in 5-10 years

lvader

PeacefulWaters wrote: »

What are you basing this on?

People get fooled looking at the share price which is totally irrelavent. The banks engaged in massive dilution of shares so the number of oustanding shares is much greater. Market cap is a better figure to look at, even then it doesn't really take into account all the changes that have occured.

PeacefulWaters

lvader wrote: »

People get fooled looking at the share price which is totally irrelavent. The banks engaged in massive dilution of shares so the number of oustanding shares is much greater. Market cap is a better figure to look at, even then it doesn't really take into account all the changes that have occured.

I get that.

So what was the market capitalisation of LLOY at 31st December 2007?

It's £57.7bn tonight.

lvader

About £18bn in 2008, and around £27bn if you add HBOS.

PeacefulWaters

lvader wrote: »

About £18bn in 2008, and around £27bn if you add HBOS.

But the effects of the Credit Crunch were well under way by that stage. Bank valuations had already dropped dramatically.

Pre-crisis HBOS were the bigger bank.

You've selected bailout figures, not pre-crisis valuations.

lvader

OK what were they in December 2007 and was that the peak for the year?

PeacefulWaters

lvader wrote: »

OK what were they in December 2007 and was that the peak for the year?

Dunno. I was asking you lol.

Looks like there were 7.8bn LLO shares and 12.8bn HBOS shares.

From memory LLO were around 400p each and HBOS 750p, already a third or so down from recent peaks.

So that would be in the region of £30bn plus £90bn = £120bn. Probably nudging £200bn prior to Northern Rock crashing.

Quite happy for somebody to double check these numbers. Some half hearted googling got me this far.

Looking at those numbers, subject to no more beasties like PPI, even allowing for the reduced balance sheet, there's room for an 80p share price to add another 20% - 50% within a couple of years.

markwilkinson

I bought lloyds at 32p - not quite the bottom. Still holding. I think they still represent good value, at current price, in the long term.

wary

barak wrote: »

OK! - but in that case, your opening statement that "they'll form a nice little nest egg as a platform for retirement" was rather misleading! That platform might prove to be a bit wobbly!

Misleading? Once again you seem to be making assumptions on what I meant. Just because I describe my punt as a potential nest egg or platform for retirement, this doesn't necessarily infer that the amount invested represents a large portion of our overall investment money. For all you know, it could be a relatively small portion but I'm punting (whether rightly or wrongly) on a large multiple relative to the price we bought them at, in 10 years time when their recent woes are long since behind them.

Whether it proves to be a good punt, time will tell. I do recall a thread back in Nov 2011 when LLOY were 22p. Someone asked if they were a good investment at that price and virtually all of the responses they received were negative. Yet anyone who bought at that price would already be close to having quadrupled their investment.

Radiantsoul

wary wrote: »

Whether it proves to be a good punt, time will tell. I do recall a thread back in Nov 2011 when LLOY were 22p. Someone asked if they were a good investment at that price and virtually all of the responses they received were negative. Yet anyone who bought at that price would already be close to having quadrupled their investment.

They were high risk then though.
Things turned out better, but there were scenarios - Grexit, break up of Euro, etc which might have finished it off.

barak

wary wrote: »

Misleading? Once again you seem to be making assumptions on what I meant. Just because I describe my punt as a potential nest egg or platform for retirement, this doesn't necessarily infer that the amount invested represents a large portion of our overall investment money.....

It certainly did appear to me that you were using a large holding in one share as a "platform for retirement". I'm very glad that you are not!