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| Royal Mail Doubles Profits http://www.x404.co.uk/forum/viewtopic.php?f=19&t=20665 |
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| Author: | jonbwfc [ Wed Nov 27, 2013 11:19 am ] |
| Post subject: | Royal Mail Doubles Profits |
Value of shares has risen £2.2 billion since Privatisation No, the government really didn't sell off a national asset to it's friends and supporters at an utterly ludicrously low price so they could make a vast short term profit. What could make you think that? |
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| Author: | ShockWaffle [ Wed Nov 27, 2013 8:17 pm ] |
| Post subject: | Re: Royal Mail Doubles Profits |
It's overvalued. The rise in profitability is not a result of increasing business, the long term outlook of the company is yet to improve. They have labour disputes and cash tied up in non productive assets both of which make future investment doubtful. They are in competition with companies who have no such problems. Buying shares at a price that factors in assumptions about future earnings growth is therefore a reckless gamble (albeit one which could pay off handsomely if the present management are extremely good at negotiating those hurdles). In other words, the price wasn't ludicrously low, but it is now unreasonably high. |
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