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Metom no reason for big rise yesterday so easy to bring down today. The markets can be draining just got to stick to your own personal plan.
I had expected RR to stay at about 124 right up till results tomorrow then lets see what happens.
I guarantee you there will be another big fall when 1st death of Omicron is confirmed as markets know ppl panic on anything these days.
The rest of the news should be predictable as we know about SMR, additional revenue from Aukus, Fighter jets etc plus significant cash raise from ITP
Main thing I am looking out for is engine flying hours. There was a good point on this in HL on overview for week ahead
“The other metric to watch where Rolls is concerned is Engine Flying Hours (EFH) – this is the amount of time its engines spend in the air. And it’s what the all-important servicing revenue is based on. When we last heard, they were expected to recover to just 55% of 2019 levels in 2021 and 80% of 2019 levels in 2022. We wonder if the news of new Covid-variants and further travel restrictions have forced management to downgrade these targets at this stage.”
CW don’t let the haters get you down. I do agree with the general sentiment though that there has become too much back biting on here in recent times. I don’t mind hearing positive or negative views as long as there is justification but most of the time ppl just want to have a pop.
I think personally CW adds a lot of good insights into the broader markets which I do follow myself but should be useful to others as well. People just making general points that we will reach 125 or 140 tomorrow isn’t useful. If most ppl looked at their recent posts don’t think many have given any insight on RR or the broader markets so lets not be too harsh on those that do.
Falky you have to remember there is a new wave of LTH now for RR compared to pre-pandemic. Once RR gets clear of Covid impacts it is in a far better place as Trent engines issues have gone, cost cutting of company taken place, business has clear future strategy for diversification with SMRs and they have sold off smaller business lines such as ITP to have clearer focus. You would miss a lot of upside to leave after initial Covid relief it will get next year.
Also I think a lot of ppl wouldn’t of invested long term in RR a few yrs ago including myself as company was in diff place so bringing that comparison is not really relevant.
They should start paying off debt as a priority especially with higher interest rates likely to come sooner than expected
CW if Sturgeon had it her way we would be in lockdown until we had zero Covid and she just loves to hassle English govt.
I am interested to see how this plays out but not worried at all on RR all my concern in short term atm is on US investments with routing going on over there.
SA age profile is lot younger than rest of world so will be hospitalisations in Europe or US that is info needed
Don’t think we need to wait for deaths to have an idea as hospitalisations should give a good steer.
Agree my point was more on if Omicron is mild then no real economic issue. It is wait and see on final results but current outlook is at worst 50:50 if not more optimistic due to no deaths and lower proportion of hospitalisations vs cases than expected so far.
There should be less economic damage if it is mild as no restrictions are required. Only if hospitalisations and deaths are high should there be any restrictions. Everyone has accepted we will be taking boosters for a number of years.
CW I think travel and markets already been routed severely and there may be a final scare early next week but more and more articles are suggesting Omicron is milder and now a week or two in we are still not getting many hospitalisations. I may be wrong but I get a sense RR could be in a much healthier position by end of next week.
Fair enough Falky although I would say RR has deviated from other travel stocks already as IAG is currently at its lowest price in 2021 while RR’s lowest price in 2021 is 87 so diversification fundamentals of RR has come into play to cushion this drop to only 125. Lets see how winter plays out but can’t see much fall especially after what should be a solid trading update this week.
Falky good to share your justification but have to disagree. If you look at HY results civil aerospace made up about 40-45% of revenue and c. flat profit with Defence and Power Systems making up the other half of the business and £300m profit. I admit RR needs the profit of Civil Aerospace to come back but Covid will be an endemic after this winter so a few months of lower revenue not going to materially damage RR recovery.
Glenn I stopped following Sky and BBC they seemed to have become equivalent of daily mail these days in terms of getting any headline possible driven by Covid
US had already announced pre departure tests on Thursday so was obvious UK would likely do the same. Might be a temporary drop on Mon but in reality was factored in last week.
More interestingly this article has come out that the escape aspect of new variant is linked to common cold which would also explain more milder effects although this is still to be confirmed
https://www.reuters.com/business/healthcare-pharmaceuticals/omicron-variant-may-have-picked-up-piece-common-cold-virus-2021-12-03/
About time RR starts to deviate from other travel stocks the risk to them is far less than an IAG or EZJ.
Will be choppy daily until we get clarity on the Omicron results. Seems that it will have milder impacts but vaccine will be lot less effective.
Main takeaway is other cheaper vaccines need to get a move on and service rest of world as Pfizer and Moderna are too expensive and difficult to store to get vaccination rates up. Also not sure why AZ is not being rolled out more widely.
In the US, President Joe Biden has said the new strain "is a cause for concern, not a cause for panic", and that he does not foresee new lockdowns or travel restrictions