Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
in fact year's end might be a time to catch some bargains because of that..
also lets not get discouraged by end-of-year sell offs even if they happen - they could be caused by US investors. US investors can choose either calendar or fiscal year for tax purposes.. often they like to close their positions between October and January to wrap up their tax period
but if they were closing wouldn't they be buying instead of selling? The sell figure is at over 61 million shares..
something is not right, the trade counts here https://investing.thisismoney.co.uk/quote/RR. are following for today:
Buy Sell Unknown
Quantity 3,367 2,696 713
Volume 18,707,165 61,125,873 13,042,077
Value £13,829,217 £44,732,003 £9,676,716
Buys are pretty close to this website, but it looks like a lot more shares were sold than the figure shown here (here it says 25,922,446 sold)
imagine having so much money, someone just sold almost 90 million shares..
lol again should be:
so should be 30.613bn - 36.874bn = -6.261bn or
30613mln - 36874mln = -6261mln
it's too early :-)
so should be 30.613bn - 36.874bn = 6.261bn or
30613mln - 36874mln = 6261mln
JTT, yes I meant Millions there sorry
JTT regarding current market caps, for RR only (I don't research the other stocks on your list):
- market cap 5.97bn
- book value (simple accounting) = total assets - total liabilities, as per https://www.rolls-royce.com/~/media/Files/R/Rolls-Royce/documents/investors/2022-hy-press-release.pdf
page 16 - consolidated balance sheet:
total assets (30613 bn) - total liabilities (36874 bn) = Net Value (-6261bn)
Negative equity is, as I mentioned previously, a bad sign in itself. However, generally speaking market value (cap) should be as close to book/intristic value as possible to consider the share price prospect to be promising. In case of RR it is nowhere close. As a general rule if the market cap is 5 times or more the book value then the share price is already well overpriced, and I don't know how do you measure 5.97bn against a negative figure, but even if the book value was at 1bn positive it would still be overpriced.
High P/E ratio which is in triple digits is in line with the above. Although depending on source I find that the current P/E ratio is e.g. 648.09 as per HL (https://www.hl.co.uk/shares/shares-search-results/r/rolls-royce-holdings-plc-ordinary-20p), and if I google it ("rolls royce holding P/E ratio") I get this:
"The PE ratio is a simple way to assess whether a stock is over or under valued and is the most widely used valuation measure. Rolls-Royce Holdings PE ratio as of October 03, 2022 is 0.00."
These are the reasons why I would answer your question that RR current market cap (i.e. share price times the number of outstanding shares), does not reflect the real value of the company at the moment. Although I am not sure if the direction is as you expected when you asked.
I often see comments such as RR is in a specific industry with high barrier to entry etc., and these are valid points, but right now they are the reason why the company is still around. If it was a different industry it could be in much more trouble.
Share price is a different matter, basically I would not expect any great results in short to mid-term future. As you have also mentioned, definitely a long term investment.
Of course it's not all down to Truss, we have known about what she wants to do for about a week and a half, and the plan is not even in motion. Lets give her a chance.
I think BT is a solid company which will grow:
- large market cap (over 10 billion)
- good P/E ratio
- pays dividends
- there is a concern about debt so it might hinder growth temporarily, but where isn't it a concern at the moment? here https://www.sharesmagazine.co.uk/shares/share/BT.A/fundamentals we see that the net equity is growing and above debt which is a good sign
- cash flow - the good: it is positive, the bad: it has declined
Overall, given the current macroeconomic conditions, this company is strong, in terms of a takeover there is not much we can do if it happens. They negotiate the price which is higher than the current price, there is no consideration about which investor paid how much for their stock.
wow this share is definitely going to the moon
As I said, it was my own opinion/delusion about the current situation. I agree with you that the prospects for the future look positive and I think they are taking the right steps in many areas. In fact, I believe that it is a good price to buy and potentially you have a 2-3 bagger (maybe even more) even at the current price.
Yes I wanted to double check the accurate figure of the debt so I don't quote it wrong. I do know there are still a few billion outstanding long term debt, and yes I do think that at the moment the stock is overpriced. I also think it will turn around, but it will take time.
Conger2, here is a summary from August https://www.hl.co.uk/shares/share-research/202208/rolls-royce-tough-conditions-but-full-year-guidance-unchanged
"Net debt stood at £5.1bn at the end of the period - the group acknowledged there were no "significant" debt maturities until 2024." (long term debt) That was before the ITP money:
"Rolls Royce has received regulatory approval for the sale of ITP Aero, and the deal is expected to complete in the coming weeks. Proceeds will be used to repay a loan which has exposure to interest rate increases." - this has been a good move.
I'm sorry, but I couldn't find the total debt figure, just the net.
If you read through that article, overall it actually gives RR a positive outlook, albeit in the long term. Otherwise, for now, they ask shareholders to brace for some "turbulence".
One of the biggest mistakes investors make is to think that since the stock price is so low it cannot go any lower.. even if balance sheets and prospects look very good the price may drop although eventually it will catch up. Conversely, the price may go up well beyond its real worth, but again, it will be adjusted in time. At this point based on debt, supply chain issues, P/E ratio, and slow revenue growth, I would value the stock at lower than 50p. The reality is though that it's the investors who ultimately set the price, there is nothing stopping the price from going to 90p like RRInvestor suggests or even higher than that. I remember when I first invested in RR at about 88p, which was in March I think, and on Friday that week the price jumped right up to 111p, apparently on a rumour lol. I stupidly believed that it can only get better from there and waited until it dropped to around 94 to sell, so I made a few pounds, but I learnt about how volatile things can get.
at least someone can come back and say it's a green day
fleccy you asked earlier, so according to https://www.pensions-expert.com/DB-Derisking/BT-slashes-pensions-deficit-by-4bn-in-one-year?ct=true if my understanding is correct they are still in deficit, however they were able to slash that deficit significantly (from 5.1 to 1.1 billion)
government bonds are printed by government as a guarantee to repay them later (at a specified time) with a fixed interest. In other words government is borrowing money from Bank of England to support spending. It might be good it might be bad, depends on what they will do with the borrowed money. I suppose it's better than printing..
The downside is, if government borrows it means the taxpayers borrow, it's our debt.
I don't think we will see a drop below 60p today, but who knows? I was surprised to see a 65p sp already (I mean so quickly, I would expect a more gradual drop over time)