Boyobach I echo NoQuestionMarks comment Your analysis is one of the things that differentiates this BB from others I’ve been on over the years which is helpful as I’m up to my neck in this share relatively speaking but emphasise that’s my choice and is in no way intended to imply any duty of care owed by anyone who contributes to the discussion
I note Brent futures have dipped to $64.75 so expect a fall tomorrow but if I’ve learned anything about this share it’s expect the unexpected
Will sit tight through 2021 and see how the trading goes through all quarters into next year but I’ve accepted the upside is likely to be less than I thought and that I didn’t have the bottle to accumulate when the price was sub £10 despite my lack of experience of the share back then and uncertainty over market reaction
Keep up the good work GLA and I shall carry on saying DYOR
Amateur hour - after so much denial the markets are playing the game of oh dear what about the stimulus and lovely cheap money we thought was going to go on for years yet. If I had more cash I’d buy at this level but then again with variants and Covid deniers refusing vaccines and a slow global roll out of immunisation I wouldn’t put it past fate to throw us a curved ball. So I’m hunkering down and shouting GLA DYOR
Capitalistpig Well done for getting in under a tenner as my best lot was 250 at 1023 and I’ve paid everything in between up to 1496 for various lots to average 1323 on 3000 shares which is a huge position for me. The dividend will feel nice but obviously not if it’s subsidising a corresponding fall in SP I still have faith that I t’s too early to call time on oil and that the SP will advance but psychologically I believe the upside will gradually reduce as people take a more political stance of the need to tackle climate change and discount the oil majors by expecting higher capital expenditure to take a bigger share of operating cashflow. Barring a vaccine failure at the hand of a variant I’m still of the view £18 will be achievable in 12-18 months as air travel slowly re establishes itself.
OP knocked by concern over China demand following week growth is just the sort of thing that wrong foots me trying to take short term profits on my shareholding I topped up a month ago below 1400 and should’ve taken the 1480 for before they went ex div
Never mind I’ll hold on and wait for the elusive £15 to cut my position which is looking increasingly like it might br elusive this quarter but don’t take my word for it as I never get the timing right! Thanks
Hi Boyobach yes I was disappointed to see the SP fall which continues today
I saw the bit in press about Nicola Sturgeon trying to get licences revoked in some of Shell’s JV deals
There’s a lot of emotive talk about climate change that ignores the commercial reality that unless government goes further into debt transitioning has to be paid for by profit from existing fuel sources and Greenpeace aren’t offering an sustainable alternative suggestion
The SP weakness may have something to do with this.
Positive response in SP as ongoing business looking robust Been a good journey for this share over recent months Wished I’d held on but making money elsewhere now so no regrets - hope those on this less active BB doing well - GLA
Boyobach it’s early days but SP response to OP of $68 not that bad so far today but it’s significant that oil has crashed through $70 level which I hadn’t expected albeit RDS will have had a good start to Q3 off back of average OP so far have
Boyobach OP recovered a bit too - falling price meeting rising demand so hopefully it’ll support SP at raised floor Roll on ex divi date and share buy backs represent good value at this level IMHO hope for a good end to the week!
Dividend yield is one valuation calculation basis so if RDSB stopped paying dividends the SP would fall significantly as even II invest for income as well as capital gain.
The advantage of share buyback as you know is that it reduces the overall payout at a given dividend level by reducing tge number of shares left to pay it and also gives each one of us a slightly bigger slice of a smaller cake so the opposite of dilution.
It also increases return on capital employed at a given level of profit which is a key performance measure that RDS will be judged against its peers and again may make it a relatively attractive investment.
The SP is also influenced by the OP as the company trades in that commodity but again that’s just a facet.
You are of course right to point out that determination of value depends on much more than dividend payment and share buybacks which are only made possible by cash generated by the business which for RDS is a known strength.
Above all the faith the market and shareholder collective have in the business management and their strategy for the future that ensures continuity of profits and cash flows are sustainable over the longer term is what underpins valuation.
My average isn’t much below yours at c £13.25 and I’m overweight in terms of where I’d expected to be but have decided to hold on for another year to see how the business performs under the stewardship of its management team and see how far the SP goes.
Boyobach Thanks for your informative posts as always I’m pleased with the increased dividend as have built a nice position and am coming to terms with the price not moving up quite as quickly or substantially - will hold for longer term and certainly sell none of my holding under £18 given the wait
Just goes to show how weak the correlation between OP and SP has become - I’ve concluded it’s best to focus on the longer term trends - hopefully RDSB will vindicate my patience in holding for Q2 results which were as good as I could’ve expected. There’s more to SP than yield obviously but the company generating huge amounts of cash while the OP sits up at these levels should either underpin further dividend growth and / or larger levels of share buybacks
The company has authority under Companyues Act to buy that many but the current $2b program which ends on 31 Dec 2021 would fund by my estimate up to 100m shares so the sanction will take some time to work though