The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
The FTSE futures market is closed until 1am as far as I’m aware.
I actually think far more will go back than the article suggests. If polled, I would indicate that I wouldn't be rushing back to shops - not because I'm concerned about the risks - but because I simply don't like shops, and could think of nothing worth than queuing to get into Primark.
I'm very confident that those who regularly go to the cinema will go back in numbers when allowed to do so. I wouldn't even call myself an avid cinema fan (I go once every few months to see something I really want to see) but when it opens up I would be keen to see just about anything to help break up the routine.
I don't believe a second wave will happen in the way that people anticipate. We will absolutely not see the same number we saw at it's peak again. What I do expect to see is fluctuation around a low level. Somedays there will be a few hundred new cases, somedays there may be a 1000+. Not a second wave in the truest sense, but fluctuation around a low point. We've seen this already in parts of Europe that were weeks ahead of us, and have successfully opened up their economies (at least partly), implemented social distancing, and avoided a second wave.
In the absence of a massive upsurge, we simply won't lockdown again.
We'll see a similar effect here imo.
Yes, novelty wears off, but cinema is a novelty that's been entrenched in people's mind for a century or so. The novelty value wearing off will be more than offset by people, looking for escapism, heading back in numbers provided there isn't a significant spike in cases.
The market is reacting to news just now, rather than fundamentals. Overall, I think today's news was received as modestly positive, but the share price was held back by the wider sell-off.
So what other news is possibly on the horizon?
Positive:
Confirmed opening date
2m rule being adjusted to 1m
Successful opening of retail shops, backed by strong demand from the public
Negative:
The possibility of a 'second wave'. Even a whiff of this can cause the market to sell off heavily.
Personally, I believe there's more positive news on the horizon, and even if we see some volatility we're likely to see CINE push back up towards 100p in the coming weeks. While the second wave can definitely cause panic, I don't believe we would go into lockdown again.
I find the idea that streaming will kill cinema a but weak tbh. I understand the convenience of streaming, especially at a time like this, and why it killed of video/dvd-rental, but people don't go the cinema for convenience. It's an experience, and escapism.
The VHS (or whatever came before that) introduced the concept of films being on demand at home, and was a far bigger threat to theatres that streaming is, imo. Streaming simply takes that a step further in terms of convenience. It doesn't exist to replace to 'big screen' experience.
Streaming services killed video/dvd rental. I don't believe they've had any effect cinema revenues.
Feels like a bit of a false equivalence.
One thing that leads me to believe that the share price is still extremely attractive even after the current rise is how cinemas responded to the 2008 financial crisis. By all accounts revenues were up across the entire industry, with people wanting to escape the recession for a couple of hours. Movies aren't just entertainment, they're escapism - an opportunity to put uncertainty and worry behind you for a short time.
Excuse the source, but a very interesting article here from the Hollywood Reporter:
https://www.hollywoodreporter.com/news/how-recession-proof-is-hollywood-now-1169172
Cinema's and theatre are ingrained within our culture, and people WILL be back at the earliest opportunity, imo.
Sturgeon just announced it live (so take it for what it's worth!). I would be surprised if the UK government wasn't going to implement similar measures.
Confirmation that the government will meet the lost revenue bus companies are experiencing just announced.
It will turn around, not much doubt about that. I’m not sure it will be before the results are released at the end of July though. The business model needs tweaking rather than any wholesale changes for me.
Not sure what my buying price is in all honesty, I would probably need to see a reversal in trend before I got back on board. I think we’ll see sub £25 values.
Certainly some noticeable upwards price movement this morning. Makes me wonder if news of impending results, or dare I say it, progress in the US has leaked.
Interesting the preferences people have with regards to bottle design. I was in Brewhemia in edinburgh last night and noticed the old Blackwoods bottle on the shelf. I spoke to the barmaid who said that whilst it’s a very nice gin, people don’t usually order it due to the plain looking bottle not being eye catching. I’ve felt similarly before. When you go into Tesco or an upmarket bar, gin more than any other spirit has a number of very eye catching bottles - the blue of Bombay sapphire, the distinctive shape of Tanquery, or the really classy looking dark Hendricks bottle, plus loads of smaller batch gins. Time will tell wether the new Blackwoods bottle can stand out amongst that type of competition.
I'm puzzled as to why there is a fascination with the PE ratio of the stock. It's a thinly traded, micro-cap stock in the early stages of its cycle and with substantial growth prospects. The PE ratio is absolutely the wrong choice for valuation here. For me, revenue is absolutely key. I don't really mind if they spend ever � of profitability on additional advertising/marketing as long as that brings in more than an additional � in revenue, which it seems to be doing currently.
Good to see some positive share price movement after a tough few days. Hopefully we've found the bottom now and can stabilize. At this price I do consider the stock a buy.
Expected a retrace after results but not to this extent. Oversold at current levels imo.
I'm leaning towards the view that there was no mention of a US distribution deal because we're well into negotiations with a potential US distributor. It seems odd to me that there would be absolutely no mention of the deal in the recent results release and the most likely conclusion I can come to is that saying anything at this stage would be market sensitive. I'm not saying a deal is imminent, but I do believe we're deep in negotiations.
There is a chance that something is in the pipeline and that's the reason for the silence, I feel like I've been hearing that message for a while now though. It could well be true, either way it would've been good to hear some sort of update, even if that update was just a couple of lines in today's RNS saying talks are ongoing - anything to keep us informed basically. From my experience in thinly traded, small cap stocks - retail investors place a lot of importance of this sort of thing and feeling like they're part of the story, particularly one that has the potential to be huge for the company. To not mention it at all in the half year results feels a bit weak to me.
The results themselves are broadly in line with what I expected, it's a slow builder but in a healthy position. Not having any mention of the US distribution deal is very poor though imo. I understand these things take time, but investors should be kept better informed than I feel I am being here.
Does anyone know when we can expect the next set of results?