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Pennyperson (< 20)

Banco Santander, Spain and the PIIGS

Recs

19

December 02, 2010 – Comments (35) | RELATED TICKERS: SAN

Maybe my pitch should have been a blog =)

So here goes:

Good solid bank and pays a nice yield. It’s been hit hard by the European banking crisis. I think Spain will be the last of the PIIGS to have their hand out and even perhaps won't need a bailout.
Besides, American banks got bailed out and the ones that did have survived and their stock prices have appreciated (every single one of them) and at the cost of the tax payer and I’m one of them. I also own shares of one the bailed out banks. So, I paid taxes to make money to pay taxes – go figure.
The bottom line is.. Europeans need banks just like everyone else in the world. Face it, the Euro isn’t going to crash and burn, but, the Euro crisis (is) in full tilt. I’d have to admit – STD would be hard to buy in RL. So, I’m playing this one in caps only “for now”. They shall survive - at what cost is the real question.

I roll my eyes at times; unless these European banks don’t get nationalized you’re going to make money. IRE and NBG will probably be good examples or European stocks in general. 

My PF crumbled over are own banking crisis so I gambled big time in 09 when the market was down. Gees, my mouth is still watering wishing I had another chance at certain stocks or more funds to invest. What a rush - millionaires became billionaires in 09. So, what’s stopping the same thing from happening over the European crises because I’m all ears? (Making funds).

I think it’s just another mouth watering investment opportunity instead of some global melt down. 

Just my two cents

 

35 Comments – Post Your Own

#1) On December 02, 2010 at 8:06 PM, ChrisGraley (29.74) wrote:

I'm not so sure. Spain has about 10% of Europe's GDP. It's going to be really, really, hard for Germany to write the check to bail out Spain and the request is coming.

Yes, they may have to nationalize the bank, but remember that they don't control the printing presses. Investors will not be rewarded by nationalization, they'll lose everything.

Also wiki-leaks is about to unload a bunch of documents about the overall banking industry and that's probably not going to help any bank.

It's only CAPS so take the risk here if you want. 

Just putting in my 2 cents 

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#2) On December 02, 2010 at 8:18 PM, rd80 (97.08) wrote:

Besides, American banks got bailed out and the ones that did have survived and their stock prices have appreciated (every single one of them)

Sort my other player's scorecard by Stock Gain and you'll see that's not the case.  A large number of bailed out US banks are still trading below their price at time of bailout and a few of them have failed.

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#3) On December 02, 2010 at 8:25 PM, portefeuille (99.66) wrote:

Yes, they may have to nationalize the bank

Actually they are currently privatising a few things. And since when are banks that are doing alright nationalised (outside of Venezuela)?

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#4) On December 02, 2010 at 8:35 PM, portefeuille (99.66) wrote:

Spain and Ireland turn to privatisation

 

 

JCF Consensus Estimates for Banco Santander (SAN:SM, STD:US) (in EUR).



enlarge

 

Umsatz - revenue
Gewinn je Aktie - earnings per share
KGV (Kurs-Gewinn-Verhältnis) - PER (Price-Earnings-Ratio)
Nettoverschuldung - net debt
Mrd. - Milliarden - billion

dictionary is here.

http://dict.leo.org/ende?lang=en&lp=ende&search=

translation is here.

http://translate.google.com/

http://babelfish.yahoo.com/

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#5) On December 02, 2010 at 8:45 PM, portefeuille (99.66) wrote:



enlarge

 



enlarge

 

from this presentation (pdf).

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#6) On December 02, 2010 at 9:03 PM, portefeuille (99.66) wrote:

Spanish bank fund plans new bond issue

Spain PM Zapatero: 'Guarantee' Government Bondholders Will Take No Haircuts -CNBC

 












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#7) On December 02, 2010 at 9:03 PM, Pennyperson (< 20) wrote:

Rd80

Thanks for correcting me of failed banks. I was incorrect. I was referring to the major players. But, it still is an investment opportunity in the European market.

Germany is kind and can write the check and Spain might not ask. (That’s a sole opinion).

 And screw wiki-leaks, instead of banks they could probably unload a bunch of documents on every politician in the world that would have more negative and devastating affects. It's all about timing & opportunity.

Do we need people like wiki-leaks - YES (thank God it's about time), But, the mortgage problems in the U.S. was warned well in advance of the melt down and we didn’t need wiki to figure that one out. Most ignored it and thought it would never happen as it appears.

This is not all about STD, but, about the overall opo in the Euro stock market. My mouth waters to see the outcome …just pull the trigger at the right time and choose those stocks wisely.

Make some money and prosper and hope we all survive our global economy.

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#8) On December 02, 2010 at 9:05 PM, portefeuille (99.66) wrote:

the video.

Zapatero & the Spanish Situation

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#9) On December 02, 2010 at 9:08 PM, Pennyperson (< 20) wrote:

BTW - Port, I knew you would give us all some charts and videos =)

You go Port, you need to be the next TMF person and go head to head with TMFUltralong

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#10) On December 02, 2010 at 9:08 PM, Pennyperson (< 20) wrote:

BTW - Port, I knew you would give us all some charts and videos =)

You go Port, you need to be the next TMF person and go head to head with TMFUltralong

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#11) On December 02, 2010 at 9:11 PM, portefeuille (99.66) wrote:

Full Transcript of CNBC's Interview with Zapatero

Zapatero descarta que los bancos españoles necesiten una inyección de capital

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#12) On December 02, 2010 at 9:11 PM, soycapital (< 20) wrote:

So  portefeuille

Care to offer an opinion on european buys at these levels? I bought some european bank stocks before the dust settled and they ate my lunch about a year and a half ago. The only one I've bought in RL is TEF but I'm itching for more to even the score. Thanks, Soy

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#13) On December 02, 2010 at 9:14 PM, portefeuille (99.66) wrote:

I have spent around 3 years in Spain. Time to defend it a little, hehe ...

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#14) On December 02, 2010 at 9:20 PM, EnigmaDude (87.06) wrote:

Go long on all of em

IRE STD NBG ...

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#15) On December 02, 2010 at 9:28 PM, Pennyperson (< 20) wrote:

Glad to see you defend it to be candid port.

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#16) On December 02, 2010 at 9:39 PM, portefeuille (99.66) wrote:

#12 I think you could simply buy an ETF or some "certificate" that covers the European banking sector if you want to get some "exposure". I currently have 250 Banco Santander shares, 22 Deutsche Bank shares (DBK:GY, DB:US), 50 Commerzbank shares (CBK:GY, CRZBY:US), 5800 Allied Irish Banks shares (ALBK:LN <-> 1/2 AIB:US) and 2000 Bank of Ireland shares (BKIR:LN <-> 1/4 IRE:US) in my portfolio (see this post). My next buy might be a few UniCredit shares (UCG:IM).

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#17) On December 02, 2010 at 9:46 PM, soycapital (< 20) wrote:

Forgive my questions but which ETF's offer the european banking sector? I'm thinking you probably know off the top of your head and I could spend an hour searching. Thanks again, good idea.

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#18) On December 02, 2010 at 10:01 PM, portefeuille (99.66) wrote:

#17 This is one.

http://quicktake.morningstar.com/etfnet/Holdings.aspx?Country=&Symbol=EUFN

A few "European bank heavy" ETFs are mentioned here.

6 ETFs That Could Be Hit in a European Banking Crisis

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#19) On December 02, 2010 at 10:04 PM, portefeuille (99.66) wrote:

#18 EUFN appears to be relatively new and the volume is somewhat "anemic", so you should use orders with "reasonable" limits if you want to trade EUFN "shares".

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#20) On December 02, 2010 at 10:06 PM, soycapital (< 20) wrote:

portefeuille,

Thank you for the info, will let you know how it goes. By the way, ING was the bank that I sold at a loss last year, I see it's doing some better now. Looking back I could have held on but honestly some Fear kicked in. I've learned from that.

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#21) On December 02, 2010 at 11:00 PM, ChrisGraley (29.74) wrote:

Porty, I agree that they are trying to privatize. They can't afford Santandar to fail though and may resort to taking it over if there is no other choice.

Ireland's voters will have a lot to do with sentiment on Spain.

As far as wiki-leaks, all banks go down if bad news is posted. This could be a great buying opportunity, but only for banks that aren't under the microscope. The institutional money is focusing on Santandar, so it's under the microscope.

High risk/High reward.

I prefer Low Risk/High Reward 

 

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#22) On December 02, 2010 at 11:51 PM, Tagit (64.98) wrote:

I prefer Both Chris, and is made into my own PF. I thank everyone for some sound advise w/ this blog. Looks like PP is looking at options which is OK with me.

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#23) On December 03, 2010 at 2:50 AM, Valyooo (99.47) wrote:

Chris why would STD ever need to be nationalized? They're in great shape

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#24) On December 03, 2010 at 8:21 AM, ChrisGraley (29.74) wrote:

Not one bank on this planet is in great shape.

Most of the assets on their books are worthless.

We can convince people in the US that the banks are OK because we can print endless amounts of money. Spain can't do the same thing.

 

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#25) On December 03, 2010 at 8:59 AM, JakilaTheHun (99.93) wrote:

Actually, I'd say there's  a substantial likelihood that the Euro "crashes and burns."  That's what makes it different from the US.  All the talk about the Dollar being in trouble is garbage; but the Euro is a flawed currency.  Unless the Eurozone is willing to enact reforms that allow price convergence (and right now, they are going in the exact opposite direction with austerity), things can and will continue to get worse.

That said, Santander is a great bank.  It's the one and only Eurozone bank I am invested in. There's pretty much no realistic chance that it fails, but that doesn't mean that a continued deflationary spiral couldn't make it a loser any way.  

My bet is that they are well enough diversified and have strong enough capital levels that they will survive any carnage in Europe.  They are in a lot better shape than many of the other Eurozone big banks.  

NBG is a good bank, as well, but they are already having difficulties and are starting to sell off their Turkey franchise; which is a bad sign to me.  This is a case where a good bank is being dragged down by the troubles of a national government, rather than the reverse (which is the case in Ireland).  Either way, the Euro is causing major economic destruction in the PIIGS and it will slowly filter its way deeper into the Eurozone (as even the "strong" economies will be weakened by the destruction in the PIIGS.) 

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#26) On December 03, 2010 at 1:08 PM, Schmacko (44.40) wrote:

I bought some shares of STD in RL for my retirement account, relatively recently after reading a Jim Jubak (I consider him a pretty level headed investment advice dispenser) article and doing a little digging around.  It could definitely go down more from it's current price on any european piigs panic news, but it's at relatively distressed levels historically, still pays regular dividends, and is much better diversified than many other eurocentric banks.  I've been a fan of and owned off and on shares of their chilean and brazilian subsidiaries for a few years and I think this is not a bad place to get on board the parent company for people with long investment horizions (like I gots in my retirement account).

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#27) On December 03, 2010 at 3:42 PM, panchocharlie (22.41) wrote:

What are your thoughts on BBVA ?

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#28) On December 03, 2010 at 5:16 PM, Pennyperson (< 20) wrote:

Avoid for now like I’am with STD 

BBVA:

Moving Average Convergence/Divergence indicates a Bearish Trend.

Chart pattern indicates a Strong Downward Trend.

Relative Strength is Bearish.

Up/Down volume pattern indicates that the stock is under Distribution.

The 50 day Moving Average is falling which is Bearish.

The 200 day Moving Average is falling which is Bearish.


 

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#29) On December 03, 2010 at 8:05 PM, soycapital (< 20) wrote:

#26:

That's funny, I bought ING on Jim Jubak recomendation back in 2009. He thought the worst was over for ING. I forgot exactly how much $$$ I lost on that decision but believe me it was not pretty. Since then I've been more careful.

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#30) On December 05, 2010 at 10:34 PM, MungerSon (< 20) wrote:

Another comment on Jubak: Yes he seems like a decent fellow but I will never, ever forget him selling FCX (Freeport McMoran) at 19 bucks in Dec 08 for a 90% loss in his RL portfolio...his reasoning? They had cut the dividend.

 Today the stock trades at 109 PPS

 Yes Yes, I know I know we ALL Make Mistakes...True enough...but selling a good company like FCX for 19 bucks, a multi-year low, when it trades at over 100 a mere 2 years later?!?! and this from a so called guru?!?!

 Sorry some things I just can't get over, at the time I said that even made Cramer look good!

 As for the OP, I do believe that Euro banks like STD, IRE, NBG and LLG are great long term buying opportunities though STD in particular could see some further weakness. Not for the faint of heart or the guys looking at retirement. For young people with high risk tolerance, I think it's worth your consideration.

 Final pet peeve: I really, really dislike how people say "Yes yes! It's a great buying opportunity! It's fantastic wonderful BUT only caps for now...

 I guess we should save RL buying assets for until they've hit 52 week highs and all the analysts are in love with them...

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#31) On December 05, 2010 at 10:38 PM, MungerSon (< 20) wrote:

oops, make LLG = LYG, Lloyd's of London

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#32) On December 06, 2010 at 11:00 AM, Pennyperson (< 20) wrote:

 MungerSon

I like all your picks and LYG. Caps for now comment is because it may have a slim chance for a bounce and to score a few points. I'm not that young so investing is STD in RL would be hard. If it made a slight down turn and the price was right (for me) I'd be a buyer.

I buy and sell mid term. I don't hold stocks for years. Probably should and will at some point for retire yrs

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#33) On December 06, 2010 at 12:03 PM, Schmacko (44.40) wrote:

#29:

I didn't buy it becaus Jubak recommended it, so much as his article brought it back to my attention and made me look at it again.  There is no one I read/watch/listen too who could get me to buy a stock without looking at it myself first.  Jubak just seems more even killed than the perma-bears/bulls, who alawys tend to pick the same things regardless of market conditions, or someone like Cramer, who I do watch on occassion, but seems to make a lot of reccomendations based on current momentum. 

STD seems like a decent pick for people with very long investment horizons (I plan on holding many years in my retirement account).  For people who are looking for shor term plays this stock is probably a fairly risky play. 

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#34) On December 06, 2010 at 4:11 PM, rd80 (97.08) wrote:

@Pennyperson

Thought you might like to know I quoted your blog entry in a Fool article on Banco Santander

Fool on!

Russ

 

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