Black ‘n blue chips
Posted on March 11, 2009 by Richard Beddard
Filed Under Companies, Markets |
Too good a headline to waste
It’s nicked from the New York Times, and I’m using it in a forthcoming iBall episode, but it’s just too good a headline to waste.
This morning I wrote the script for an iBall show on shares you can buy for under a pound. It’s probably a very dubious statistic as I don’t know what kind of dross is in my data, but I reckon 75% of shares listed in London fit into this category now.
So, as well as Keynesians, we’re all penny share investors now.
Most of the former blue chips that find themselves in this undignified position are either at the heart of the financial crisis, i.e.:
- Financials like RBS 21p, Legal & General 26p, Lloyds Banking 50p, Barclays 67p and…
- Housebuilders like Barratt Developments 89p
…Or victims of it, like the companies we might have once labelled ‘big media’:
- Johnston Press 8p, ITV 18p and Trinity Mirror 30p
Of course prices of black ‘n blue chip penny stocks are highly volatile at the moment (these are yesterday’s closing prices), particularly in the case of Johnston Press, which today included these chilling words in its preliminary results:
…Although the Directors remain confident of either the disposal of the Republic of Ireland businesses or a successful renegotiation of the Group’s debt facilities, they have concluded that the combination of these circumstances, as they are not within our gift, indicate the existence of a material uncertainty which may cast significant doubt on the Group’s and Company’s ability to continue as a going concern, and if this is the case the Group and Company may be unable to continue to realise assets and discharge liabilities in the normal course of business.
Regional newspapers were once impregnable businesses with local monopolies over peoples’ attention, and therefore advertising. It looks like a combination of recession and obsolescence will sweep some of them away.
Who’d have predicted it would happen so quickly?
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No doubt, that’s a great headline