# Nat'l Bank of Greece (Banking): 12.84, 2.93 billion, 40, 16.06. 10.00, 6.0 billion # Michaniki (Construction/Engineering): 1.76, 136 million, 9, 0.97, 0.54, 36 million # Titan (Cement): 35.88, 1.50 billion, 45, 19.62, 17.85, 1.4 billion # Hellenic Bottlers (Beverages): 12.98, 3.07 billion, 30, 20.05, 19.71, 7.2 billion # OPAP (National gaming company): 9.26, 2.95 billion, 32, 16.90,14.63, 4.67 billion # Lambrakis (Newspapers, media): 2.44, 184 million, 4, 1.67,1.02, 83 million # [[OTE]] (Telecom): 10.56, 5.3 billion, 26, 9.38, 7.97, 3.9 billion # Intracom (Technology): 4.18, 523 million, 7, 1.08, 0.66, 88 million # DEH (Electric Utility
I note that despite the recovery in ES from 1052 to 1068 in recent hours, that Greece is noticeably weak. http://www.ase.gr/content/en/marketdata/indices/prices/ and NBG is down 2.5% and OTE is down 4.8%. If this weakness continues then it's possible it will drag France down, which will hurt European equities ... which will ...
NBG is a noticeable underperformer today. Other weak European bank stocks (RBS, LYG, BCS, STD, BBVA) are flat or up. But the weakness in NBG continues, down 7 cents to $1.75, and getting close to its 52-week low. Meanwhile 10 year Greek debt is just under 12% http://www.bloomberg.com/apps/quote?ticker=GGGB10YR:IND
IMO Greece is going to go the way of Russia/Asia in 1998 - a full-on banking collapse and emerging market panic. I have been slowly compiling a list of blue chip Greek companies with strong balance sheets, low debt, and entrenched market positions, which I intend to buy once a full-blow collapse and market panic has ravaged prices. If this happens, I will aim to acquire high quality companies on the cheap. My plan is to put maybe 30% of my assets into them, and then hold for 5+ years, only selling once they reach frothy bull market valuations at the peak of the next cycle. Russia took 9 1/2 years from the 1998 secular low to the 2008 spring peak. The stocks went up enormously, around 40 fold in just under a decade. Brazil did it in just 5 1/2 years, from autumn 2002 to early 2008 For timing, I will wait for several banks to go bust, the market and politicians to panic, and stocks there to fall 20-30% in one week after already having a major bear market move to new lows beforehand. I'd like to see the bank stocks trading for 0.1-0.2 times book value, like some did in March 2009 in the USA. I want to see retail stocks trading for 0.1 times revenues, or high quality blue chips selling for 4 times earnings, 12% dividend yields etc. Greek government bonds may also become bargains, although probably not as much as stocks. If they default in uncontrolled fashion, I'd consider acquiring them. Russia fell to below 10 cents on the dollar for sovereign debt IIRC, so cheap that only 2 interest payments were enough to make back your entire investment. That was a great buy - but not as great a buy as the stocks were.
The relative weakness is very telling. NBG down 2/3rds in a year when the market as a whole is up. I did an analysis on the bank balance sheets and solvency ratios earlier this year, and most of the banks were in the danger zone where default becomes quite a serious likelihood. If I knew more about bank accounting & analysis, I would probably still short them even at these prices. Here's a quick review of the balance sheet and default issues: http://brontecapital.blogspot.com/2010/06/national-bank-of-greece-part-2-in.html
Thanks for your posts GoC, and thanks also for the link to Bronte Capital. In terms of fundamental analysis, I think Reggie Middleton has also done quite a bit of work on Europe, analysing both European banks as well as European sovereign debt. Regarding NBG, it's done nearly 3 million shares versus 5.3 million average (source = Yahoo Finance). I'm short a small amount, however I agree that there is the potential for this to become a larger banking crisis. There might also be a strong signal to short if and when we find out that regulator(s) require NBG and other banks to raise more capital, just like the multiple capital raisings for AIB and IRE.
"Germany considering Greek debt rescheduling -report" http://www.reuters.com/article/idUSLDE70I0YD20110119 snippet: "Die Zeit weekly, citing unnamed government sources, said in a preview of Thursday's edition that the plan was to let Greece use credits from the European Financial Stability Facility (EFSF), in return for a commitment to pro-stability policies"
While the S&P negative outlook for USA Inc is the big eye-catching media headline, I think this covers up the ongoing European drama. Specifically Greek govt bond yields going crazy, and EUR/USD down over 1%.
EUR/USD up strongly today on the overall "risk on" theme, but meanwhile, National Bank of Greece down to another 52-week low http://noir.bloomberg.com/apps/quote?ticker=ETE:GA NBG down 2.5% on strong volume to $1.56 Greek 2-year yield at 21.93% http://noir.bloomberg.com/apps/quote?ticker=GGGB2YR:IND Greek 10-year yield at 14.74% http://noir.bloomberg.com/apps/quote?ticker=GGGB10YR:IND and for what it's worth, here is a Reuters article quoting rumours of debt restructuring as early as this weekend: http://www.reuters.com/article/2011/04/20/greece-banks-idUSATH00603420110420 "There are intense rumours in the market that there will be a restructuring soon," said an Athens-based trader who declined to be named. Another trader reported similar rumours."