August 27, 2014

Should I buy Saga shares as part of IPO? Analysts talk

700,000 customers of Saga have expressed an interest in buying shares in Saga and investing in its IPO.

Should I buy Saga shares and invest in the Saga IPO is a common question investors are asking. As the IPO nears, analysts have shared their views on the proposition. This article rounds up the thoughts available online so far regarding buying Saga shares in the Saga IPO:

  • Alastair McCaig of IG Index (via WhatInvestment) has claimed that Saga shares are ‘likely to be attractive to income investors’ and praised the business for its loyal customer base, over 50s target market with a high disposable income and a magazine with large numbers of paid subscribers.
  • Holly Black of This is Money commented that the firm has no direct rivals, a strong brand and customers who appreciate the cover provided by its insurance policies.
  • Gavin Oldham of the Share Centre told the FT Adviser that as the proportion of over 50s is expected to significantly increase, there should be ‘plenty of opportunity’ for growth in ‘all areas’ of Saga’s business.
  • Questor of The Telegraph raises concerns about the amount of debt on Saga’s balance sheet and says to ‘avoid’ investing in Saga shares. However, he notes  Saga has loyal customers and a large database of target demographics.

The minimum investment in the Saga IPO for retail investors is £1,000. Potential investors are urged to base their investment decisions based on their own research and not the views of others. Applications should only be made on the basis of information contained within Saga’s prospectus, any supplement to the prospectus and notification of pricing.


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