Worth a Punt on Rolls Royce?

Yep I’m in too.

Apparently, pokemon card dealerships are where the action’s at these days.

https://twitter.com/ShaanVP/status/1353951035224694785

Yep I’m in too

Good man. 11% in 5 hours is none too shabby. Alas I didn’t have the courage of my convictions so only bought a bit.
You?
Sell now for 11% and hope it drops again tomorrow, or wait to try to get 20% out of it….

Hmmmm

Liked that hedge fund Reddit story.

Not investing with large amount looking long term investment.

My trade commission is based on lumping several trades in together buying on a set date on Thursday coming (only £2.5 per trade with Halifax sharebuilder)

Thought I’d take a chance too. I’m up £137 today from yesterday. I am definitely not into day trading and quick returns but I can see the appeal when it does this. 🙂

I wasn’t sure about the ethics of this one. Not super keen on “defense” investment but they are a good UK employer with a decent graduate training program so on balance decided it was OK.

I bought in before the rights issue and currently just about breaking even but saw the highs of 130p plus in December. It’s a volatile share price so day traders can clean up if they time it right but to me that’s gambling. This is a long term hold if you buy in at these sort of prices. Some good diversification into cleaner energy and with a new chairman to be appointed and increases in flight hours later in the year, it’s a good investment.

91.7 now

Rolls Royce are looking to build mini nuclear reactors for the UK, a bit like they have on nuclear submarines.
If it works out then they could see some growth.
Personally I’m dubious how much life there is left in nuclear once large scale storage batteries get going.

Small modular reactors look to be the medium term future for energy demands, at least going from the international news traffic – it isn’t just Rolls Royce on this bandwagon. I’m hoping we jump on the green energy bandwagon also really – green energy is something I’d love to be a part of manufacturing.

Share price wise Rolls relies heavily on civil aerospace flying hours and repair work for its revenue (totalcare). The slower this takes to recover, the slower the revenues and share price will recover. We’re still on a ventilator in terms of company performance at the minute – the vaccine rollout, if successful, may result in a big upturn in share price. If unsuccessful, well we’re possibly looking at bailout territory as Rolls is burning cash for fun at the minute.

Again, thanks for the support chaps, it’s been a mad 11 months.

According to France 24 air traffic is down to 2003 levels. I looked up and thought ‘why can’t I see a plane then?’, a busy air corridor to Madrid goes over my head. With less flights and fewer passengers in them the industry is bleeding cash and won’t see the benefits of vaccination until after the Summer. I hope (as a green) that some reductions will be permanent as businesses have learned to work virtually.

Air France KLM lost 7.1 billion last year, Airbus lost at least 1.1 billion, Boeing lost 11.9 billion

The airline industry is a $2.5 trillion global business and underpins the whole global economy and most of our jobs rely on it somewhere in the supply chain, even if the impact of flying is invisible to you in your job. It is forecast to recover to pre covid levels around 2024 then continue to grow pretty much as it was before COVID. Business wont retain working remotely from customers and already business travel is picking up…some people taking quarantining – may as well work from a hotel room than at home with the prospect of meeting with prospective customers. There may be more of remote working going on but it will be additional to and not instead of face to face business.

If anything there could be the prospect of more business travel after covid. Some businesses are choosing to close office buildings and saving hundreds of grand a month in building lease charges and maintenance costs, with employees basing themselves from home and traveling to visit customers more often. The company my brother works for has done this. He can now live anwyhere he wants in Europe and not tied to commutable distance to the office, and just travel to visit clients and customers wherever they may be as required. If you’re saving £100k a month on building costs that can fund alot of business trips which is a far better use of capital.

The challenge for airlines is wether business class travel will return or will businesses downgraded to economy or premium economy. Business class accounts for a significant amount of revenue and profit for an airline business model.

There is significant pent up demand for people returning to flying for business and pleasure and to re-connect with family, another big driver for air travel. Before Covid about 1000 people a day flew into Manchester Airport a day from Pakistan, mostly for family visits and events like weddings. Thats just Manchester Airport – similar levels into Birmingham, Glasgow and even more into Heathrow and Gatwick. The question is can airlines and manufacturers survive until the recovery kicks in?

The good thing for RR is that their global fleet is quite young and mostly made up of the latest gen aircraft and engines so the cleanest aircraft and most efficient flying – over 10% more efficient than previous generation aircraft so that’s ALOT of CO2 savings a year in an industry that only contributes less than 3% of CO2 emissions. So as the recovery starts airlines are more likely to bring their newer and more efficient aircraft back into service ahead of the ‘old smokers’, some of which will never fly again other than a ferry flight to to be parked in the desert and broken up for parts.

As to what impacts RR share price…well that is one of life’s mysteries. They win an order and the share price goes down, they lose an order and the share price goes down. RR is a long term business and the finance industry just doesn’t understand the business so there is often no logic to the response of the share price to what’s going on with the company. But RR has secured alot of free cash to ride out the next few years until the recovery hopefully kicks in. Over 5K people out of 9k announced global redundancies walked out of the door in 2020 with the closure of several significant production facilities globally. Thankfully the fiancee industry has recognised the extraordinary steps the company has taken to weather the storm. But probably still wont reflect in the share price.

Some news about a possible a350 freight variant coming, this could be potential good news.

Anybody still riding this particular roller coaster? Bit of a spike over the last few days. I’m quite tempted to cash in as I’m £900 up since January but I normally buy and hold and this could be the start of the march back to 2019 levels as the world opens up. How is everyone doing

Aha, was thinking about this thread. My current batch appears to be £600 up. Sold some last week at 115 and have a limit order to sell more at 122. Got within 60p of it yesterday, but not quite there.
🙂

It’s a tricky one (obviously). The recent rise makes me also want to cash out, but as you say, its still only a third of its max so has some serious potential if things get back to normal.

BUT then of course there is a school of thought that says there ain’t no going back to normal. Global warming, Webex etc mean that things ain’t never gonna be the same again.

The other one that surprises me is BP. I had shit loads of them a year ago but have been getting rid as I’m expecting huge pressure being put on institutional investors to dump oil stock, at which point it’ll go through the floor.
But the bloody stuff is up 10% this month…🤨

I’m slowly heading FF’s ( and pretty much everyone else TBF) advice and moving out of trading gambling individual shares and just dumping it all in funds.

Also got some BA for the kids last week at 1.36, which I’m immensely pleased about. It’s up 25% 😛🤪🤑

Just sold. Bought into a green(ish) fund with the money so a financial and moral win. Watch it soar now 🙂

I backed the wrong horse with IAG mid pandemic. But I wasn’t expecting a quick turnaround so I’ll be sitting on them for a good while yet.

What’s the collective’s view on Lufthansa shares at the moment?

Bloody Nora. 25% down today. What’s that all about?

Aha share issue.

Sorry for the stupid question, but does anyone know if I buy today whether I get the option on the new ones or if I need to have owned them prior to today?

Or indeed if I can buy them regardless of whether I currently own them…

What’s the collective’s view on Lufthansa shares at the moment?

Just bought a grand at £5.32….

And hoping that this gives me the option on the issue at
****. Just looked further, and it appears that the issue starts today, which suggests that I had to own this morning to get the rights, which I didn’t, so I won’t.

Oops

Which explains why it dropped 25% overnight… owning the shares yesterday entitled you to buying more today at a discount. But owning them today doesn’t.

Ah, well. Quite funny really. Could have been worse.

it appears that the issue starts today

Where did you see that? I’m looking and can’t find anything on the relevant dates.

https://investor-relations.lufthansagroup.com/en/news/ad-hoc-releases/investor-relations-ad-hoc-releases/date/2021/09/19/deutsche-lufthansa-ag-decides-on-eur-21-billion-capital-increase.html

The gross proceeds are expected to amount to EUR 2,140 million. The subscription price of EUR 3.58 per New Share corresponds to a discount of 39.3% on the TERP (theoretical ex-rights price). The subscription ratio is 1:1. The new shares are to be offered to the Company’s shareholders during the subscription period, which is expected to commence on September 22, 2021 and end on October 5, 2021. The rights trading is expected to commence on September 22, 2021 and end on September 30, 2021.

I hope I’m wrong, but it seems like the logical explanation.

Yesterday the shares were €8, today they have dropped to €6. The only explanation I can think of is that yesterday you could also look forward to buying a matching share for €3.58 or whatever.

Ie 8+3.58 = 11.58
Which is the same as 6 +6.

Stands to reason: at the point you lose your right to buy at half price, the share price falls by a quarter….

No?

No?

Indeed. The prospectus states (pg 60, but can’t copy and paste for some reason) that it is “…on the basis of the holdings as of September 21, 2021, in the evening,…”
Your figures make sense, but the rub is that although the share offer price is at 3.58 they almost always open higher than that, meaning quick cut and run profits for those who got in on time. Sadly that’s not you or me, it appears.
Ho hum, they might bounce back slightly pre-offer…

I’m up 60% after the rights issue, can’t complain. Not letting go until some rich PE folk with hyper inflated $’s or so try to force a sale.

Just sold. Bought into a green(ish) fund with the money so a financial and moral win. Watch it soar now 🙂

Up another 10p again today [RR]
So sold another wee batch. Going to run out soon!

Share prices in general are nuts just now. I’m up 33% on last year.

Yep. Still in. Short term it has been a roller coaster but long term prospects look good. I’m holding and sitting on a decent return since investing (20%+). ITP sale is imminent (or at least announcement of an agreement) and there is an outside chance they will win the bid to refit USAF B52s (one of three bids). Business has been streamlined and the ITP sale will significantly reduce borrowing costs. In terms of ethics, they’ve just successfully tested an electric plane (spirit of innovation) and are trialling engines using Sustainable Aviation Fuel. The flip side is they will be involved in the Australian subs contract. I think the rise to 130p is a correction following US routes opening up again rather than another bubble.

I don’t mean to crash the RR and airline sector party but I feel compelled to say the only thing worth investing in at the moment is AMC. Get in now before the mother of all short squeezes (MOASS) happens without you. I’m not going to justify this opinion, as there is so much information already available online to justify it. I have been “all in” on AMC since late May, having made reasonable money on the likes of Moderna, Bionano Genomics and others (not RR!) in the past. This is more than an investment, it’s a movement to level the playing field and bring the hedgefunds and market makers down.

Good luck with that

Can’t give opinion on AMC but you know that a good portion of hedge funds are on your side of the trade and that retail volume is basically insignificant. Retail investors are mere pawns.

AMC

You got in in May, when it was around 10 dollah. You now want us to go in at 40 dollah…..

Erm, no.

AMC is very different, retail investors (the so-called “apes”) own 80% of the float, with institutions holding the rest. ORTEX data shows the short interest is now over 20% with 105 million or so shares short and those are only the ones we can see. 60%+ volume is routed via dark pools, naked shorting has been rife, there are an unknown amount of synthetic short shares as well as the 105 million that will need to be covered. If the apes continue their “buy and hold” strategy the shorts won’t be able to cover until the apes decide to sell, pushing the price higher and higher, along with gamma squeezes (on the most highly traded derivatives (call and put options) in the market) and FOMO… I’m starting to justify it when I said I wouldn’t!

Even if you aren’t interested in putting any money into it it’s very interesting and will likely go down in history.

I’m not telling anyone to buy anything, I’m just trying to raise awareness. That being said, $40 is cheap, if you believe that the price could potentially go to 4, 5, maybe 6 figures if/when it squeezes. Do your own research and make up your own minds.

Meme stocks? I’ll pass. Enjoy the free money bonanza!

6 figures? I’ll use my profits to buy some of whatever you’re smoking

(And I write that as someone who already has a small position in AMC)

Didn’t realise retail owned so much, thought it was another Gamestop with Blackrock behind the apes. Vanguard and Blackrock are the largest institutional shareholders of AMC. Will grab some popcorn and watch from the sidelines. Will certainly be interesting with Top Gun, Mission Impossible and James Bond all awaiting release.

I put 50 quid into AMC at $30, doubled my money and ran away. I don’t think I’ll be jumping back in again.

Don’t know if anyone follows Doomberg – generally tends to the pessimistic side but is always an interesting read. Here’s his take on AMC, which is very negative indeed. But then again, it’s a meme stock – who knows what will happen.

That being said, $40 is cheap

No…

Look at the business model of AMC, what industry its operating in and what its historic value is.

Long term it’ll drop back to $10

In the short term you could get lucky and make some money if your timing is right, but there are going to be a lot of smaller investors who are going to lose out when they decide to cash in a $40 stock that has an intrinsic value of ~$10

Look at the business model of AMC, what industry its operating in and what its historic value is.

is exactly what the “experts” said about Gamestop 🤔

No…

Look at the business model of AMC, what industry its operating in and what its historic value is.

Long term it’ll drop back to $10

AMC is no longer a fundamental play, it’s a short squeeze play. Their share price isn’t based on it’s fundamental value, it’s purely psychological. Having said that, their fundamentals are better than ever and they’re growing very healthily.

East Imperial (EISB) has been good for me since I bought at 10.4p on July 21st. Sold just under half on September 14th at 19.9p and banked 90% of my initial investment so will leave the rest to hopefully grow. Not for the feint hearted and details are sketchy but they seem to have a good niche from which to chip away at Fever Tree’s market.