What You Were Buying Last Week: Royal Bank of Scotland

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

LONDON -- One of Warren Buffett's famous investing sayings is "be fearful when others are greedy and greedy only when others are fearful" -- or, in other words, sell when others are buying, and buy when they're selling.

But we might expect Foolish investors to know that, and looking at what Fools have been buying recently might well provide us with some ideas for good investments.

So, in this series of articles, we're going to look at what customers of The Motley Fool ShareDealing Service have been buying in the past week or so, and what might have made them decide to do so.

Set to recover?
In the No. 4 spot in the latest "Top Ten Buys" list* is Royal Bank of Scotland (LSE: RBS  ) . The bank hasn't had a good time of late and was also in the number four position in the "Top Ten Sells" list a couple of weeks ago, just ahead of the announcement of its 6 billion-pound loss, and since when the share price has continue to fall. So what might have persuaded some people that the bank is worth buying?

Perhaps they think the market has been just a bit too unfair on the bank's share price. Although it's still over 13% down on its pre-loss-announcement level, there are some indications that the price is stabilizing, and perhaps even set to start a recovery. At the time of writing, it's up 1.5% on the day.

Royal Bank of Scotland is also at a quite compelling discount to its tangible net asset value -- currently over 30% -- which could provide a good upside for investors who are prepared to wait for the share price to play catch-up with the bank's book value. True, it is still to dispose of a substantial chunk of non-core assets, but there should be value left over that could lift the share price as market sentiment toward the bank improves.

There's also no doubt that the bank's balance sheet and share price performance have been hit by various scandals over the past few years -- compensation payments for the mis-selling of payment protection insurance and interest rate hedging products, and regulatory fines for LIBOR-rigging have totaled well over 2 billion pounds. If those misadventures are now mostly behind it, the bank's future should be rather more profitable.  And while it still doesn't pay a dividend, it may well be in a position to resume paying one by sometime in 2014, which should further improve confidence in the bank.

A high-quality growth share
If you're not persuaded by Royal Bank of Scotland, but are still looking for a high-quality growth share, you'll want to get hold of "The Motley Fool's Top Growth Share for 2013" -- it's the latest report by the Fool's expert analysts and has only just been released.

It's completely free of charge, but like all special reports from TMF, it will only be available for a limited period, so get your copy delivered to your inbox now!

*Based on aggregate data from The Motley Fool ShareDealing Service.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2307618, ~/Articles/ArticleHandler.aspx, 9/25/2016 12:05:51 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,261.45 -131.01 -0.71%
S&P 500 2,164.69 -12.49 -0.57%
NASD 5,305.75 -33.78 -0.63%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/23/2016 12:08 PM
RBS $182.14 Down -4.37 -2.34%
Royal Bank of Scot… CAPS Rating: No stars