It has not been anything new, because it was news expected by the financial markets and therefore by all investors. Well, Banco Santander has decided to launch the capital increase amounting to 7.072 million euros, at a discount of 17,75%, with which it will support the recent purchase of Banco Popular. On the other hand, it will offer more information on this important capitalization operation in the coming days.
This corporate event implies that the bank chaired by Ana Patricia Botín will issue a total of 1.458 million new shares of the same class and series as the existing ones and with preferential subscription right for current shareholders. This is news that affects both the current shareholders of the financial entity, as well as those who wait to buy shares in the financial group from now on. The main question of this capital increase is whether it will be profitable for the interests of small and medium investors.
In this sense, if you are already a Banco Santander shareholder, you should know that you will be able to subscribe a new share for every 10 shares you currently own. With an issue price of 4,85 euros per share, which in practice represents a discount of 17,75%. In any case, and for the information of this corporate movement, it is subject to approval. of the corresponding brochure by the National Securities Market Commission. Nor can you forget that during this quarter, the bank will exercise the traditional dividend payment that it distributes among shareholders.
Santander expansion
In any case, you cannot forget that there are certain deadlines to be a participant in this new capital increase. Because indeed, if your idea is to go to it, you will be able to do so in the period of 15 days between July 6 and July 20, 2017. It is estimated that the new actions start trading from July 31. With the novelty that you will be able to collect dividends with the new shares purchased.
With regard to dividends, the board of directors has announced its intention to propose a dividend charged to 2017 of 0,22 euros per share. With a fixed and annual return of around 5% and one of the most important in national equities. To the point that it has been able to take on a major group of retailers with a more conservative profile among its shareholders. As is the case with other banks that are listed on the stock market, as in the specific case of BBVA.
Business results
Nor can Santander's income statement be forgotten in order to opt for the acceptance of this important capital increase. Because indeed, at the end of this month of July present the accounts corresponding to the first semester of the year. Where, without a doubt, it can give some other clue about the financial muscle of the entity. And who knows whether to opt for the purchase of its shares or on the contrary under a strategy based on undoing the positions acquired in the preceding months.
From this general scenario, the forecasts for these business results point to Banco Santander obtaining an attributable profit of approximately 3.600 million euros, which means 24% more than in the same period of the previous year. All despite the fact that costs increase below 4%, while the benefits generated by commissions are estimated to grow below levels above 10%. Any deviation from these accounts would lead to increased volatility in their share prices. In one way or another and to the joy of buyers and sellers, respectively.
It will also be a data of special relevance to determine whether or not it is convenient to attend this capital increase that is about to begin. Although in the end it will be a very personal decision that small and medium investors will have to make. Just in a period of the year as complicated as the summer months are. Where many of them decide to give rest to their activities related to the world of money. Either way, it is an alternative that is presented to you so that you can make your financial contributions profitable.
It is stabilized at six euros
At the moment it is setting a price around the barrier of six euros per share. With a annual profitability close to 21%. In what is one of the most important returns of national equities. Above other financial entities and even other listed companies with a great specific weight in the Ibex 35. Not surprisingly, 2017 is being a good year for the interests of the entity. Something that very few financial analysts had at the beginning of this year.
In any case, its prospects are even higher, according to the forecasts of some financial analysts. With a up to 20% upside potential in some of the more positive forecasts. Of all, in most of them they are above their current prices. Plus all the returns that they generate through the collection of dividends every year in a fixed and guaranteed way. To the point that it is one of the most recommended values by financial agents. To form a stable part in an investment portfolio destined for all investor profiles. From the most aggressive to the most moderate in their approaches to relating to the always complicated world of money.
Nor can you forget that Santander shares are still at their highest in recent trading sessions. Where it trades close to levels of seven euros for each share. While its minimums are very far from the positions which. Specifically, he came to visit levels very close to three euros. From where he began to resume his positions with special intensity. In a very favorable exercise to defend the interests of small and medium investors.
Claim in the purchase of Popular
Another news that has caught the attention of investors is the process of buying the popular Bank for only euro. Well, in this sense, the bank indicates that "the acquisition of the entity could entail resources or claims of all kinds." Although at the moment these news are not being felt in their daily quotes. But on the contrary, they have supposed a reinforcement in the intensity of its upward movement. Because in effect, there are no massive sales in the financial markets.
Although it cannot be forgotten that, according to the financial institution itself, there could be a "significant adverse impact" on their accounts. As a consequence of complaints from former clients of Popular. With a reflection in a slight drop in the price of its shares, although during a period not excessively dense. This is one of the possibilities that some of the most famous experts in the equity markets are considering.
To attend or not to enlargement?
Either way, it can be very interesting to head to this new title movement. At least for the medium and long terms of stay. In which a return higher than that generated by fixed income products can be obtained. Among others, time deposits, bank notes or bonds. It is constituted as one of the investment strategies that you can use if in the end you decide to go to this capital increase by Banco Santander.
However, you run the serious risk that the share price can be devalued in the next trading sessions. So that in this way, you lose money in this operation that you are going to develop. Especially if you want to make it profitable in the shortest of terms. It is something that you must anticipate if you undertake these kinds of movements. Furthermore, you cannot rule out a change in trend in international equity markets.
Another aspect that can harm your interests is the change of strategy in the Interest rate by the community monetary authorities and that undoubtedly may end up affecting the Spanish stock market. In this regard, a foreseeable change by the ECB could ruin your expectations with the purchase of the new Santander shares. Something that can foreseeably be developed at the end of the year. Period in which your new shares will already be listed.
It is in short, the lights and shadows that the acceptance of these operations in the market will mean. To the point that some unforeseen event can always appear that could seriously harm your interests as a small and medium investor. At least at the beginning since the prices of the actions, as on the other hand it is logical, will be diluted as many more shares are listed on the markets variable income. To gradually return to the beginning of the original prices and it will be located at the current levels. That is, around six euros per share.