I think the RBS and Virgin Money share prices could double your money

first_img Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Alan Oscroft | Tuesday, 28th January, 2020 | More on: NWG VMUK Our 6 ‘Best Buys Now’ Shares I think the RBS and Virgin Money share prices could double your money I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Alan Oscroft owns shares of Lloyds Banking Group. The Motley Fool UK has recommended Barclays and 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. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Enter Your Email Addresscenter_img Simply click below to discover how you can take advantage of this. Image source: Getty Images. Since the depths of the financial crisis, there have been two main ways to invest in a banking recovery. One is to buy shares in the big banks themselves, now that their balance sheets are a lot stronger.The other is to go for a challenger bank, which I think offers greater short-term growth prospects. I see more risk too, mind, and those who went for Metro Bank are probably regretting it. The Metro share price is down 95% in two years after a catalogue of horrors.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…If you’d invested in Virgin Money at the wrong time, you’d have been hit by the PPI scandal. The final cost turned out to be less than expected, but it was enough to result in a £232m pre-tax loss for the year to September 2019. But with that out of the way, analysts are predicting healthy profits for the current year. And forecast earnings would put the shares at a price-to-earnings ratio of only 7.6.The dividend would yield around 1.9%, but that would grow to 4% on 2021 forecasts.First quarterA Q1 update Tuesday shows no obvious problems I can see. The bank did, however, point out that “the UK banking market continues to face competitive pressures and uncertainty over the final Brexit settlement.” Oh, Boris, if only you hadn’t set that December deadline, we could be enjoying a return to economic optimism right now.Virgin saw a modest 1.6% growth in customer deposits, which seems fine. Mortgages did drop 0.8%, but it’s a tough market right now, and I’m not unduly concerned. Business lending grew 2.5% to £8.1bn for the quarter, and personal lending was up 3.7% to £5.2bn. I’m impressed by both of those figures.On the liquidity front, the bank’s common tier one equity did drop a little, but at 13.1% it’s still very healthy.I see a straightforward, well-managed retail bank here, with strong business and personal prospects. On today’s share price, I rate Virgin Money a buy.RecoveryTurning to the big banks, shares in Royal Bank of Scotland (LSE: RBS) spiked up immediately after the election. But like Lloyds and Barclays, they turned tail again after that post-election Brexit twist. Over the past five years, RBS shares are down 43%, for the biggest fall of the three.Results for 2019 are due on 14 February, and the forecast 75% rise in earnings per share puts the bank’s shares on a P/E of 9.3. That’s relatively healthy compared to the banking sector in recent years. But it still looks very low to me if RBS really is out of the woods.The share price fall has boosted the RBS dividend yield too. There’s a special on the cards for 2019, and forecasts for 2020 put the ordinary yield at 6.5%. It’s taken RBS a few years longer than Lloyds to get back to paying dividends. But from the initial 2.5% delivered in 2018, I see that as impressive progress.Is there any risk to the dividend? Well, predicted 2020 cover looks to be about 1.7 times. I think that’s fine, provided we don’t crash out of Europe without a good trade deal. But while that threat remains, the dividend must be at some continued risk.But overall, I see RBS as a buy with exciting growth and dividend potential. And I don’t think it will remain this cheap for much longer. I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. “This Stock Could Be Like Buying Amazon in 1997” See all posts by Alan Oscroftlast_img read more