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18/10/2020
08:05 | typo56: TBH Guns I'm not sure if RR. is a good investment here or not. I don't think anyone really knows and I don't usually attach much credibility to anyone on a bulletin board who knows something for certain!
I would think that they'll be further fundraising down the line (unless they get taken over before then). I'm not sure that matters too much though for investors. I think the purpose of a fundraising is more important than the fundraising itself.
One thing I'd be careful of is thinking, "The Government won't let it fail". That may be the case, but it does not mean if it came to the crunch they'd protect ordinary shareholders from being wiped out. I recall seeing similar arguments with Carillion and Interserve and probably Marconi many years ago.
IG have produced a helpful overview of the RR. rights issue. Note that the important date for qualifying for the rights is close on 27th. The record date is irrelevant for most investors these days.
hTTps://www.ig.com/uk/news-and-trade-ideas/rolls-royce-share-price--what-you-need-to-know-about-upcoming-ri-201016
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07/10/2020
09:25 | minerve 2: SimonGn
Sorry to hear about your loss, however it is refreshing to hear someone who has some honesty about them here.
I think advice to you would be to step back first and think about your whole situation and not just about RR: how old you are and how many years to your projected retirement. Your capability to earn, other pension entitlements, job prospects etc.. etc..
What I wouldn't do - and I talk from much experience here some of it very painful like yours - is to get into the mindset that your RR investment owes you something. Rolls Royce is where it is for a reason. Those reasons are not going to disappear quickly EVEN WHEN COVID disappears. It is evident from Rolls Royce accounts and previous operating performance that Rolls Royce has some fundamental issues with its business model. For example: just look at the costs incurred when reliability issues are discovered with its engines: grounded planes and costs incurred that run into billions quickly wiping away years of progress/potential progress. In other words there is massive operational risk when you are a RR investor. And for what? OK, you might get some nice multiple return from Rolls Royce as we move forward but you could get that from many other stocks and possibly even just a FTSE 350 tracker. On the way to recovery with RR you'll be lucky to get any dividend worth considering and when (and if) you get it it will be in those damn C shares.
If you look at RR's history it has failed to deliver sensible and consistent ROCE - Return on Capital Employed. The directors haven't got an excellent record either, especially with the latest response to COVID and the delay in raising capital.
As Warren Buffet says: you don't have to make the money back from your losses the way you made them - or something to that effect. Good advice IMO and I think about this everytime I find myself in this situation. You could well be throwing good money after bad if you are not careful.
There is an opportunity now to get into other stocks that are relatively cheap and I personally would use the opportunity to write a line underneath those losses of yours and spread your risk into other stocks that will pay decent dividends. If you don't have ongoing money to put into your pension you want some form of compounding: preferably within the company itself via retained earnings and/or in the form of reinvested dividends by you.
So I personally would take this opportunity to diversify. Don't look back at your average buy in price because it is irrelevant. Keep RR as a holding (if you want) but sell enough to just have a small holding and buy ALL the rights to the holding you have left. Write the loss off and move forward.
Hope this helps. :)
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06/10/2020
23:21 | simongn: I've got some serious thinking to do in the next couple of weeks . . . my pension is in RR. not a company pension but a SIPP I have invested myself and is currently in RR.
Taking the options would cost me £18k and I would have to put that into my SIPP to take the options, it would then be locked in so borrowing the money is not an option and I don't have £18k let alone £18k to add to my SIPP.
Hindsight is easy . . . I am where I am sitting on a paper loss of £92k
I need to see if trading my Rights is possible from my SIPP, somehow I doubt it, if not I will need to get out and take my loss, at the most opportune time that I can find.
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02/10/2020
10:39 | careful: owenski
you should do more research.
RR. For most of its 100+ years history has been a highly successful private company.
World beating aero engine technology not just for WW1, WW2 but the jet age.
In fact it was RR. that helped America to get into jet engine technology when the RR. Derwent was made under licence by GE, who wanted to branch out into aviation.
Sadly they were ordered to provide the Derwent engine to Russia who copied it and installed it into their MIg15 fighters used in Korea.
And something else you must have forgotten they made magnificent motor cars also.
The development cost of the RB211 programme forced it into administration and nationalisation from 1971-1987. That is 16 years.
Hardly a culture of nationalisation.
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01/10/2020
09:24 | buywell3: This was buywells First post on this thread last year and was an answer to Ayl30 post
It gave a heads up as to what was coming down the road for RR.
buywell3 - 06 Aug 2019 - 07:45:58 - 3161 of 5046 Rolls Royce: Winning big orders - Up Full Thrust? - RR.
Ayl30 6 Aug '19 - 07:24 - 3159 of 3161
Results look reassuring, all on track. Cash forecast to improve. What not to like?
buywell continues :
This
*Net cash excludes IFRS 16 lease liability of £2.4bn in 2019
We estimate that the net impact of IFRS 16, Leases was to increase the underlying loss after tax by £38m in H1 2019.
and this where ( ) indicates a LOSS
Earnings per share H1 2019 (48.0)p H1 2018 (51.6)p
and these one off gains might NOT be repeated in the next results unless RR sells something else
Acquisitions and disposals
In H1 2019 the disposals of Commercial Marine and Power Development were completed. The combined net proceeds were £458m. The £584m cash inflow in H1 2018 related to the disposal of the L'Orange business, previously within Power Systems.
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30/9/2020
10:52 | careful: The balance sheet is a mess, no argument.
But looking beyond the balance sheet, RR has great technology and creates wealth.
RR. have generated £200-£300 bn over the last few years, lots of research, highly skilled highly paid jobs.
Going forward RR are well placed to adapt to new sources of power such as electric, nuclear, hydrogen.
We will always need power units.
RR. Are trying to raise a mere £2.5bn right now. This is set against hundreds of billions being squandered elsewhere.
Trillions of world wide debt, eye watering.
RR. is an important company, and will be even more important for future generations.
It must survive.
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25/9/2020
22:14 | careful: The RR. balance sheet is ugly that is true.
But many companies have poor balance sheets and high debt yet are considered to be good investments.
RR. has great technology and creates wealth through tens of thousands of highly skilled well paid jobs.
Not only to its employees but the suppliers also.
Over the last twenty years these benefits must be at least £200bn.
Taking a longer term view we need RR. and companies like it to prosper.
Directly or indirectly the UK benefits although right now not the owners, we shareholders.
Shareholders get a terrible deal of late. So this great 100 year old company, which has laid golden eggs for many, has some debt, and suffering short term.
We shareholders(owners)are the losers. As owners of this goose we get nothing and very shortly will be asked to contribute more cash to help its survival.
But one day its true value will be realised. How the Chinese, Americans, germans would love to buy it.
Therin lies its true value.
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20/9/2020
10:56 | careful: The speculation is a more detailed this time.
Mentioned Singapores GIC sovereign wealth fund as one of the sovereign wealth funds RR. is in talks with.
`We can all speculate that RR. would need at least £2.5bn to make a difference.
A placement of shares need not be at below todays share price.
Say 1.2 bn shares at £2.0 would be ok for everyone, including investors.
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02/9/2020
08:25 | hodhasharon: Executive Summary
Rolls-Royce Holdings plc operates as an industrial technology company worldwide.
REWARDS
Trading at 50.2% below our estimate of its fair value
Earnings are forecast to grow 55.23% per year
Share Price vs. Fair Value
50.2% Undervalued
Current Price UK£2.07
Fair Value UK£4.15
Earnings vs Savings Rate: RR. is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.2%).
Earnings vs Market: RR. is forecast to become profitable over the next 3 years, which is considered above average market growth.
High Growth Earnings: RR.'s is expected to become profitable in the next 3 years.
Revenue vs Market: RR.'s revenue (6.5% per year) is forecast to grow faster than the UK market (5.5% per year).
Ownership Breakdown
State or Government 0.02% 426,447 shares
Public Companies 0.04% 740,360 shares
Individual Insiders 0.06% 1,208,817 shares
Private Companies 0.07% 1,310,684 shares
Employee Share Scheme 1.4% 27,033,970 shares
General Public 13.6% 261,345,476 shares
Institutions 84.8% 1,626,452,983 shares
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01/9/2020
11:48 | careful: So many interesting projects at RR. going on.
The RR. electric racer is ready to fly by the end of the year.
All electric aircraft is aiming to smash the current world record if 213 mph.
Also new industry partners are being assembled for team Tempest the latest generation strike aircraft.
A collaborative project with Virgin on a mach 3 design.
so much disruptive change, new technologies are the key, RR.traditional business is changing.
Vulnerable to a predatory takeover, China/America lurking.
The Golden share will need to be activated or RR. will go foreign.
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PLUS1
