Rail shareholders?

[telstarbox]

As we know, TOCs are owned by private companies whose duty is to create value for their shareholders. Do any members on here hold shares in FirstGroup, Stagecoach etc? If so do you think you get a good return on your investment?

 

[muttynut]

Oh yes my shares in first group have almost doubled ... a nice little nest egg in fact

 

[Bishopstone]

Yes.

Stagecoach have been a very good investment, and FirstGroup a bad one, with GoAhead somewhere in the middle. Of course, all of these companies have interests beyond UK rail. For example, both Stagecoach and First own yellow school bus businesses in the USA, whilst National Express have a large Spanish coach business.

It's off topic, but over the last six years Stagecoach sold the East London Bus Group, then re-purchased it for about a third of the price! Whatever you think of him, Mr Souter is a canny businessman.

 

[6Gman]

I have a small shareholding in Stagecoach (used to be larger). Have done well, especially those bought when Stagecoach was having its American problems.

Also had a holding in Arriva; got a very good deal from DB!

 

[mikeg]

Not a shareholder in any of the TOC owners at the moment, but in the past have held shares in Go Ahead and did reasonably well out of it. Bought at about 1200 and sold about 1500 a couple of years or so ago. Was considering buying into Firstgroup a couple of months ago and had I been in a better financial position would have done so, and my prediction is thus far being proven. The issue is that the majority of these public transport firms make the majority of their profits from their bus operations, though Firstgroup looks interesting with its selling off of many of its bus operations. Personally I think it's still a buy. To be honest I can't see why the share price fell so much on the WCML franchise falling through. If anything it was a blessing in disguise as had Firstgroup continued with the WCML franchise the result would likely have been financially disastrous due to the errors in the franchising process which were later revealed. Probably it will become one of the more 'rail' plays on public transport once the bus restructuring is complete.

I am however still more keen on buses and I think that the AIM-listed Rotala offers better value despite having a higher price to earnings ratio - one which still suggests it is undervalued. It's a near-pure bus play although I believe they do executive transport as well. Though if I had loads of money I would probably still buy into both.

My reason for not holding any shares is purely my current financial situation. When I have money to save I typically put it into shares owing to the poor interest rates on saving accounts and typically average a better return. It's just that income has been low recently and outgoings high.

 

[DaveNewcastle]

National Express (NEX) prices have risen by 30% over the past 3 months.

Otherwise, they have not shown any sustained growth since a slight recovery in 2009 from the massive falls of 2008.
In terms of dividends, the yield has been between 4% and 5% recently.