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Archive for the ‘Allied Irish Bank share price’ Category

Place you’r bets on Bank Of Ireland


A few months ago, I said that  Bank of Ireland share price would fall  to 55 cent  and even lower down to the 20’s . Any of my followers that took heed of my advice will now be nursing huge profits

Bank in April I warned that the rights issue was a complete rip off and the Government went ahead and purchased 575.6 million shares at €1.80 each. So at this mornings prices we the taxpayers have sustained loss again of 70 % = 402.92 million Euros in 5 months

In any other business these incompetent baboons Lenihan and Cowen  would be kicked out of office  ,Truly monkeys wouldn’t do any worse!

As for the distressed shareholders I afraid there is more bad news on the way .Bank of Ireland I believe ,Is harboring derivatives, and the news  cannot be  good . Anglo and Allied Irish Bank are also in the dog house and nothing will change the direction of the shares until the full facts are known and I don’t mean the banks telling us fibs we need to have an independent audit done on their derivatives trades of which I believe we are looking at 150billion at least in losses

In other words all the banks are insolvent and we are on course for a final showdown with the IMF having to step in and save the day

Shareholders get rid of the toilet paper you are holding.





The Markets do not believe you Mr.Cowen



Bank of Ireland [IRE  3.61    -0.14  (-3.73%)   ]
: Stay away from IRE, Cramer said. He

likened it to
National Bank of Greece
[NBG  2.23    -0.03  (-1.33%)   ]
Allied Irish Bank
[AIB  2.17    -0.06  (-2.69%)   ]
and said all of them “bad banks” that need
to reconstitute their balance sheets, “which means potential dilution for shareholders.”


Latest news is that Cramer is not a fan of any of the Irish Banks.

Bank of Ireland (IRE) and the Allied Irish Banks (AIB)

According to Cramer the Irish banks are like the National Bank of Greece so much for turning corners

Allowing Gangsters run Banks is one thing but allowing Gangsters to run a country is just unforgivable

Cowen and Lenihan must go!

AIB shares worth 0.60 cent

Our valuation is based on two DCF techniques. Relative valuation is not appropriate in AIB’s case: sales-based metrics like P/S are impossible to use because there is no disclosure about the nature of sales for peers on Reuters where we obtain these consensus estimates (i.e. is it gross interest income, net interest income, interest revenues plus non-interest revenues?); EBITDA-based metrics are also out of the question because of the unique nature of financial sector businesses (i.e. little depreciation, interest being part of operating income and costs); and finally, the P/E metric is simply irrelevant now because the banking sector is expected to report losses in the short run.

We forecast that AIB will report significant loss in FY2010 due to NAMA transfer-related impairments (we assumed a 43% NAMA discount), after which we expect the bank to return to profitability as the recession ends (it should, eventually) and normal economic activity resumes. Besides, the balance sheet will be cleansed of problem assets and impairments should return to normal levels.

AIB performance forecast:


Source: company reports, analyst estimates.

DCF valuation

Since financial institutions are very different from other types of businesses, our DCF valuation will be based on two techniques: the Dividend Discount Model (DDM) and the Excess Return Valuation, as described by A.Damodaran in his book Investment Valuation.

Dividend Discount Model

Historically, AIB regularly paid a dividend, which averaged at 32.5% of net income attributable to ordinary shareholders between 2004-2007. We assumed that the bank will not pay a dividend in FY2010 and will resume paying dividends in FY2011 at a modest payout ratio of 8.1%, returning to the historical rate by FY2014. We assumed that the payout ratio will remain at this level indefinitely and that net income growth will slow down to 2% by FY2019 (the assumed long-term growth rate). Discounting the expected dividends by the estimated cost of equity of 15.4% results in a price of €0.63 per share, assuming issuance of approximately 4.7 billion new shares in 2010 to supplement regulatory capital with €5 billion (through conversion of €3.5 billion of preferred stock and issuance of an additional €1.5 billion worth of stock at the current market price). We assumed that the remainder of the €7.4 billion required to strengthen the equity will come from other sources (sale of assets, optimisation of debt etc.). There is residual dilution from outstanding warrants that were issued with the €3.5 billion preferred stock. Adjusting for this dilution, the estimated value of AIB’s shares is €0.60.

source http://www.solasfinancial.com/research/?p=703

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