Stock market crashes are great times to buy shares at low prices. But the market crash has come and gone. So, what does this say about those stocks whose prices are still falling? Consider stocks like the FTSE 100 banking biggie Lloyds Bank or even BT, whose share prices are still sagging. Or even one like the low-cost airline easyJet, which tumbled out of the FTSE 100 index.
I think there are definitely hidden gems yet to be uncovered in the wake of the stock market crash. Finding them could make millionaires out of astute investors. The economy has shrunk sharply in the last quarter, which means that there are at least some pockets that are still facing the heat. Financials and travel are two examples of such sectors.
Lloyds Bank share price could remain muted
The pressure on financials is evident from the dismal recent results for banks. It’s no wonder then that the Lloyds Bank share price hasn’t seen any uptick. In fact, if anything the cancelling of dividends has pulled it down even further.
Even with economic recovery likely over the remainder of 2020, I reckon that LLOY will remain under pressure. Bad debts, low interest rates, limited credit offtake, the possibility of another stock market crash, and Brexit uncertainty are just some of the stumbling blocks ahead for the bank. For now at least, I think there are better investment options to consider.
BT share price can recover overtime
I’m less pessimistic about the FTSE 100 telecom company BT. For one, I think demand for its products and services, at a time when we are increasingly reliant on connectivity, can be expected to remain robust. I also like it for clarity on the future as reflected in the latest update.
After this year of Covid-19, it expects to “return the business to sustainable adjusted EBITDA growth”. I expect, given its long-term dividend history, it can once again start generating dividends as well. I’ve already invested in BT. It’s not a profitable investment in the post-stock market crash times, but I’m not giving up on it just yet. I think there are better times in store for it.
easyJet share price was a big stock market crash casualty
The easyJet share price is another one that has seen better days. The trinity of lockdowns, stock market crash, and most recently, the recession, have been huge blows to the low-cost airline stock. When even legendary investors like Warren Buffett start selling aviation stocks, it doesn’t help.
What does help is knowing that this share has a tendency to show very sharp and sudden movements. Admittedly, the present drop is glaring even by its own history. But these are atypical times. I think this company too will see better times as conditions return to normal. I hold easyJet shares too, and plan to continue doing so for the foreseeable future. For investors who like steadier stocks, however, especially after being burnt by the stock market crash, I think there are plenty of others to consider as well.
The post Stock market crash: What I’m doing about the falling Lloyds Bank, easyJet, and BT share prices appeared first on The Motley Fool UK.
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Manika Premsingh owns shares of BT GROUP PLC ORD 5P and easyJet. The Motley Fool UK has recommended Lloyds Banking Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Motley Fool UK 2020