Member Info for RS2002

My apologies @ Bluefiesta.

It is hard to read the context of some posts.

Good luck.

I don't know because it is sensitive and there is a thing called disclosure which must be maintained.
What we do know is it was not a SINGLE breach but MULTIPLE. Breaches (plural).

£28.3m vs overpaying BILILIONS for something work <$500m?

Cineworld is counting their blessing and Fitch (IDW will come along soon) even posted that they have COME OFF the Negative watch because of this GOOD news.

DYOR.

Totally, Moola.

So predictible.

The short positions will be closing soon, certainly ahead of 21 August so they will be desperate to test new lows.

If investors keep their stock and turn off this BB and have confidence in why they invested, they are in line for a nice recovery.

Do they really think Cineworld is the ONLY stock impacted by Covid-19? Of coure not, this is a low price and if they want to support stability, hold their shares and buy on the dips.

Bluefiesta you're too emotional my friend.
Take a deep breathe and understand this is a volatile stock.
If you believe in the fundamentals and can foresee the obvious recovery, like 99% of the rest of the global market, invest and be patient.

1. Cinemas operate a profit at as little as 20% capacity

2. Face masks worn is encouraging as it promotes the government's message and mitigates the risk of further closure.
In line with government guidelines, all customers will be required to wear face coverings whilst visiting our cinemas from Saturday August 8. They can however be removed to consume food and drink.
Source: https://www.cineworld.co.uk/static/en/uk/blog/cineworld-cinemas-reopening-FAQ-frequently-asked-questions-coronavirus-covid-19

3. Schools re-open next month September, millions of children sitting for 6 hours+, side by side, no distance and frequent touch points vs cinema viewing in staggered, static seating with frequent cleaning and controls is a lot safer.

4. Debt may be B grade but that is it - it's debt. Investors aren't trading debt securities so the grade B (like Rolls Royce btw) has a default risk of 4-6%, so 94-96% positive outlook for their debt, again from a private investor who is trading equities securities by way of stock purchase is not phased by this.

5. Shorts are nothing new, in Jan 2020 this year shorts were 14% and share price was 164p

Good luck, all don't let the de-rampers force you to sell so they can get their lower entry.

Cineworld avoided an increase of $2.1 Billion US in debt.

From their contract:
"Should the Acquisition Agreement be terminated under certain circumstances. The Major Shareholder has also agreed to pay an additional breakfee of up to £28.3million"

If you ask an investor if they want to go ahead with increased debt of BILLIONS vs paying £28.3m, the answer is quiet clear.

To buy Cineplex at 4 x the premium when their value reduced to just a quarter - would have been financial suicide.

a) Cineplex was valued at $2.1 Billion - it now worth a quarter of that ~$500million
b) Cineworld would have paid a 4 x premium had Cineplex not breached their terms of the deal - thus it is a blessing Cineplex did so

A balanced read about DEBT securities.
A default risk at Grade B of 4-6%.
Investors are not trading DEBT securities, they are trading EQUITIES securities relating to stock purchase.

DYOR everyone.

We have seen a number of regional lockdowns.
Cineworld furloughed staff and mostly use flexible staff read: zero hour contract staff so costs are easily scaled.
This has been reported by Cineworld in their RNS.

I also agree, we need an update from the BoD on their re-open of US on 21 Aug to appease the market.

When you say they weren't doing great even in 'normal' times, this is not true.

What is your definition of not great? A loss, right?

In 2019, Cineworld had a turnover of $4bn, granted their net profit was $0.2bn, it was a profit nonetheless and their share price was 164p pre-covid19 drop.

They also paid out a dividend of ~12p per share a year.

At the current share price and given their plan to re-open, the share price is oversold. Yes, the dividend is suspended, for now long? I have no idea, it could be 2 years. But, if there is a GLOBAL recovery (not just Cineworld) this presents an incredible investment for those with a diverse portfolio who want to see a dividend paid when it is resumed.

By that logic, you could have a ROI and cover your initial investment within 3-4 years based on the current SP and the SP recovering to pre-covid (~150-164p).

I don't berate those asking advice, after all this is a BB.

Good luck, all and DYOR.

@Jm4tw sorry to see you go but come back on 21 August (2 weeks time).

The US cinemas will be re-open and the market will have taken into consideration the companies strategic roadmap for recovery akin to rivals, AMC.

Good luck and I hope the rest of your portfolio is positive as we approach a vaccine and reduced US cases.

@zoro my comment was to piohc1 who said zero income. I corrected him to clarify that Cineworld is generating income and will soon see 73% of their estate open in the US on 21 Aug.

In 2 weeks, Cineworld's US Regal cinemans (making up 73% of their estate) will OPEN.

Zero income? Have you not noticed Europe inc the UK has mostly open and US is set for re-open on 21 Aug?

The dividend is not peanuts.

Yes, it is withdrawn this year as have most FTSE companies given the fallout from the pandemic but to suggest it won't be re-instated is misleading.

This is about appreciating long term value when this recovers and a dividend is re-instated.

Source: https://www.dividendmax.com/united-kingdom/london-stock-exchange/travel-and-leisure/cineworld/dividends

Exactly why I have invested.

The disconnect between NAV and share price is astounding.

This is beyond cheap. It’s a bargain at these prices for the long term investor.

I’m topping up. These prices are approaching March lows when liquidity has improved. I never thought such cheap prices could be had.

Good luck, all.

They are very desperate.

The important thing is investors ignore their deramping and ask themselves, can they wait 2 weeks until 73% of the Cineworld’s estate opening?

Im waiting for more updates from California as they have said the bars are where they are seeing increased cases spread.

Cinemas and movie theatres respect social distance and afford static seating with masks and reduced touch points which are cleaned after every screening of a movie.

Some goods news for James Bond fans.

No Time to Die's release date is now November 20 in the US. As per usual for a 007 movie, it'll be out prior to that in the UK, where it debuts on November 12.

Studios have reaffirmed their desire to see it on the big screen with a recent tweet.

I’m reading the same, Moola.

The best thing is to NOT reply in the shorters thread as it won’t be bumped. Let them circle jerk and reply to one another with basic one liners.