Stock Market logoStock Market Station

All the stock market news, every minute updated!

17 September 2021
20:58 hour

The Rolls Royce share price is below 100p – so is it a buy?

The Motley Fool UK

20/07/2021 - 15:29

The Rolls-Royce share price is once again falling, but that might not be enough to tempt Andy Ross to buy the engineer’s shares. The post The Rolls Royce share price is below 100p – so is it a buy? appeared first on The Motley Fool UK.


READ THE FULL ARTICLE ON THE MOTLEY FOOL UK

Related headlines:

  1. Is the Rolls-Royce share price cheap at 100p? (07/07/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE:RR) share price has struggled to make headway over the past couple of months. We did see an impressive rally late last year from 40p to around 135p. Recently, the share price has since fallen back to trade in a range between 100p and 110p. Given that shares were trading above 200p at the start of last year, does the current price make it a cheap buy? A tight trading range I think there are a few reasons why the Rolls-Royce share price is currently trading in a tight range around 100p. Firstly, I think a lot of investors are waiting on the sidelines for half-year results. These are due out on 5 August. This should provide a more detailed picture of how the business has coped in the period when lockdown restrictions were starting to end. In theory, this should support the share price if the planned outlook financials are raised. However, nothing is certain at the moment, and so some are likely keeping their powder dry until August. Another reason for the lack of movement recently could be due to the policy regarding Covid-19 restrictions. The anticipated freedom day in June has been pushed back to later in July. The international travel traffic light system hasn’t been the most efficient process. This has meant that the amount of flights and commercial aviation has been limited. Due to the ties Rolls-Royce has to this sector, I’m not surprised that the share price hasn’t been able to find a positive catalyst to move higher. Is the current Rolls-Royce share price fair? It’s hard to confidently say that the Rolls-Royce share price is cheap at current levels around 100p. This is because what is cheap to me might not be to someone else.  A traditional method would be to look at the price-to-earnings ratio. Usually, a low ratio could indicate that a stock is undervalued and cheap. However, Rolls-Royce made a loss last year, so the ratio is negative.  It’s also hard to rank Rolls-Royce against other companies as it depends on what sector I put it in. If I compare it to BAE Systems with a P/E ratio of 11.3, then I would say the share price looks cheap. What about if I compare it to an aviation company like International Consolidated Airlines Group? IAG has an even more negative P/E ratio than Rolls-Royce. So I could argue that IAG offers better value than the current Rolls-Royce share price. I could also look internally at Rolls-Royce. If the half-year results show a reduction in debt and good cash savings, this should help to boost the net asset value. In turn, this naturally should help to push the Rolls-Royce share price higher, as the fundamental value of the business has increased.  2021 net debt (pre-disposals) is expected at £4bn, but potentially getting back £2bn with disposal proceeds. Again, I’m going to have to wait until next month for an update on how well this is going. Overall, I think the Rolls-Royce share price is fairly priced around 100p right now. However, results next month will allow me to get a much better picture in this regard, depending on earnings and debt levels. The post Is the Rolls-Royce share price cheap at 100p? appeared first on The Motley Fool UK. Is this little-known company the next ‘Monster’ IPO? Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead. Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025. The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential. But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving. Click here to see how you can get a copy of this report for yourself today More reading This is what I’m doing about the Rolls-Royce share price Should I buy Rolls-Royce shares today? Where will the Rolls-Royce share price go in July and beyond? Rolls-Royce shares are below 100p. Should I buy? The Rolls-Royce share price: 3 things that could give it a boost jonathansmith1 has no position in any share mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  2. Could the Rolls-Royce share price fall below 100p? (27/05/2021 - The Motley Fool UK)
    One of the frustrating things for shareholders in Rolls-Royce (LSE: RR) in recent months has been its struggle to maintain altitude. The Rolls-Royce share price reached 127p in March. But since then it has moved markedly lower. Over the past year, it has lost 10% of its value. So might the shares might fall beneath 100p? Why has the Rolls-Royce share price been falling? One of the points to consider is what has been exerting downward pressure on the aerospace giant’s share price lately. The company is significantly exposed to air travel. The more hours planes with its engines installed fly, the greater its service revenue. Over the past couple of months, hopes of increased European travel have been dampened. I think that has affected the share price. Reasons to be bullish But I see some positive signs for the Rolls-Royce share price. For example, the company said this month that performance so far this year has been in line with expectations across all of its business units. That lack of nasty surprises should help restore some investor confidence in Rolls-Royce. The company has repeatedly said that it expects to turn free cash flow positive in the second half of this year. That would be big news, as lately it has been bleeding cash. If it is able to turn free cash flow positive, that will reassure investors about its liquidity. Last year, a rights issue was heavily dilutive. If shareholders are more comfortable about liquidity growing due to free cash flow, it could be positive for the Rolls-Royce share price. Will the shares fall below 100p? Despite what I regard as positive developments, the Rolls-Royce share price has been drifting downwards lately. If there are more reasons to doubt the speed and scale of European aviation recovery, I think that could easily push the shares below 100p. Any further delay to the free cash flow target would also hit the shares badly in my view. So, I don’t think the shares will necessarily stay above 100p. I could certainly see them falling below that level again. My move on the Rolls-Royce share price But I think the longer-term outlook for the Rolls-Royce share price remains good. Flying demand will come back, in my view – it’s just a matter of time. There are some promising signs outside Europe. Already in the US, for example, United Airlines has upgraded its second-quarter earnings forecast. Such improved demand should help Rolls-Royce. I still think the Rolls-Royce share price could get to 150p or higher this year. But I don’t like how sensitive the share price is to demand recovery in the aviation sector. It has no control over that so is effectively a hostage to fortune. For that reason, even though I do see potential upside, I’m not currently planning to buy Rolls-Royce shares. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading This is what I’m doing about the Rolls-Royce share price! As the Rolls-Royce share price remains cheap, I’d invest £3k Is it time to act on the Rolls-Royce share price? Can the Rolls-Royce share price stay above 100p? The Rolls-Royce share price has been ticking upwards. Is it time to buy now? christopherruane has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Could the Rolls-Royce share price fall below 100p? appeared first on The Motley Fool UK.
    [visit article]
  3. Can the Rolls-Royce share price maintain its momentum? (26/06/2021 - The Motley Fool UK)
    The last time I wrote about Rolls-Royce (LSE: RR), its share price was just at about 100p. And to me, it looked like it was ready to dip more in the short term. I was wrong. It has been consistently above the mark since.  But can it continue to stay there? I think there are reasons that both favour the trend and that can send its share price tumbling below 100p again. Supportive environment for the Rolls-Royce share price #1. Stock markets are buoyant: The fact that the stock markets in general are rising is a good sign. The FTSE 100 index has been making steady gains over time, even though on a day-to-day basis it really looks like it is going nowhere.  This shows up in individual shares’ prices too, and Rolls-Royce is one of them. In much of the past year, its price has either remained around the 100p mark or just a bit below it. It is only during the months right before the stock market rally of November that it slid sharply.  #2. Aviation is in for better times: The outlook for the sector is also improving. Aviation has been one of the worst impacted industries during the pandemic. Rolls-Royce derives a large part of its revenue from supply of aircraft engines. So, it was impacted too.  In fact, it still is. Even while much of the economy has reopened, air travel still remains limited. But as vaccinations proceed at speed, it is only a matter of time before travel becomes commonplace once again. Its share price has doubled since November, in anticipation. Pandemic and prices could play spoilsport #1. Persistent uncertainty: However, when considering buying the stock, I also need to bear in mind that we never know what new twist in the corona tale awaits. New variants have slowed down the bounce back. And Rolls-Royce itself is cautious in providing an outlook going by the uncertainty that exists.  #2. Oil price rise: Moreover, air travel may remain weak even after it is allowed. Potential travellers could choose to be cautious for some time. Oil prices are rising. And crude oil may even touch $100 a barrel this year. This would push up travel prices. Coming out of a year of economic uncertainty, furloughs, and government support, it could be a put off.  Can the Rolls-Royce share price stay above 100p? Since Rolls-Royce is sensitive to news flow at this time, its share price can react a lot. It may even plunge significantly if there are any untoward developments. Still, I am optimistic that it may not happen. In the past year, its share price has risen by only 8%. This means that it was not significantly lower than 100p even then. As I was saying earlier, it did slide down for a few months, but was soon back up. I think the real question now is whether it can continue rising over time. I maintain that it can. But I am waiting for a real turnaround before considering buying the stock for my portfolio.  The post Can the Rolls-Royce share price maintain its momentum? appeared first on The Motley Fool UK. Our 5 Top Shares for the New “Green Industrial Revolution" It was released in November 2020, and make no mistake: It’s happening. The UK Government’s 10-point plan for a new “Green Industrial Revolution.” PriceWaterhouse Coopers believes this trend will cost £400billion… …That’s just here in Britain over the next 10 years. Worldwide, the Green Industrial Revolution could be worth TRILLIONS. It’s why I’m urging all investors to read this special presentation carefully, and learn how you can uncover the 5 companies that we believe are poised to profit from this gargantuan trend ahead! Access this special "Green Industrial Revolution" presentation now More reading The Rolls-Royce share price is up 170%. Should I buy now? Will the Rolls-Royce share price rise in July? Here’s why I’m avoiding Rolls-Royce shares Why is the Rolls-Royce share price having such an uncertain June? What’s going on with the Rolls-Royce share price? Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  4. Rolls-Royce share price is around 100p. Here’s what I’d do (22/02/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE:RR) share price has likely reflected the recent battle between Covid-19 vaccines and variants. Initially, the Pfizer vaccine candidate news really beat efficacy estimates in November and the Rolls-Royce share price rallied. Later, Covid-19 variants spread and made the prospect of a fast recovery in civil aviation more distant. The Rolls-Royce share price fell as a result. With the Rolls-Royce share price now close to the 100p level and everything that’s happened, here’s what I’d do. Vaccines versus variants In the battle between the vaccine and the variants, it’s not the end of the world for Rolls-Royce. While the spread of Covid-19 variants has slowed the recovery in civil aviation, the company still expects to turn cash flow positive at some point in the second half of 2021, according to a trading update released earlier in the year. Management is also confident that they are well positioned for the future given the company’s liquidity of around £9bn. At its current stage, I reckon the Covid-19 vaccines are getting a slight upper hand on the variants. Production of Covid-19 vaccines has ramped up higher and the number of new cases has fallen in many parts of the world. If the number of new cases continue to decline sharply, there is the possibility that civil aviation recovery expectations could increase and this could potentially benefit the Rolls-Royce share price. There could also be hope in the future against variants. Companies like GlaxoSmithKline and CureVac are, for instance, working on multivalent mRNA Covid-19 vaccine candidates that could target variants more effectively. The two companies, which are working together, hope to bring a multivalent product onto the market next year. If the late stage results of those multivalent vaccine candidates are positive, I reckon that civil aviation recovery expectations could increase. With this said, Covid-19 is constantly mutating and there is potential for a new strain to hinder civil aviation more than expected. As a result, the Rolls-Royce share price could always decline. Rolls-Royce share price: what I’d do Given the current information on Covid-19 variants and the current Rolls-Royce share price, I’d buy shares. Making quality and dependable jet engines is one of the hardest things in the world to do. It takes a lot of engineering know-how that I think gives Rolls-Royce a potential competitive advantage in future growth sectors. I think civil aviation will eventually recover and RR could be a good investment as a result. I could be wrong, however, if a new Covid-19 variant spreads and becomes a big problem. I’d also follow the annual result report next month, particularly when it comes to future guidance (if management provides any). If Rolls-Royce beats the market’s real estimates on earnings or guidance, I could see how the stock could go higher. I could also see the stock going lower if the results are underwhelming. I’d also be interested in how the company’s planned sale process of ITP Aero is going. I reckon a higher than expected sale price could help the stock. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading Rolls-Royce shares: should I buy? Rolls-Royce share price: how the company is preparing for the air taxi market The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet The Rolls-Royce share price is rising this week. Should I buy? The Rolls-Royce share price is under £1: should I buy today? Jay Yao has no position in any of the shares mentioned. The Motley Fool UK has recommended GlaxoSmithKline. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce share price is around 100p. Here’s what I’d do appeared first on The Motley Fool UK.
    [visit article]
  5. Will the Rolls-Royce share price ever get back to 200p? (08/06/2021 - The Motley Fool UK)
    If I look at a list of the most volatile stocks of 2020, Rolls-Royce (LSE:RR) would definitely be on it. From trading at highs just below 700p in February, it traded well below 100p in October. Yet so far in 2021, it has been a completely different story for the Rolls-Royce share price. It has been anchored around the 100p level for several months now. With a lack of any meaningful move higher, will the shares ever break back towards 200p? Last year versus now It’s important to differentiate between this year and last year when analysing the Rolls-Royce share price. The crash and volatility seen in 2020 was because of investors processing a lot of news about the company. It quickly became apparent that with global lockdowns, commercial aviation was going to take a hit. People simply would be unable to travel abroad, meaning passenger flying miles would decrease. This meant less maintenance and new engines were required from Rolls-Royce.  Even though other areas of the business (such as defence) didn’t suffer as badly, the size of the aviation arm of the company meant that the Rolls-Royce share price fell considerably by the end of Q1. The volatility for the rest of the year mirrored the state of the pandemic. Past performance doesn’t perfectly predict future returns, but it does give me some clues. Given that the volatility last year was due to concern by investors, the calm of the past few months tells me that investors are now more neutral. A catalyst for the Rolls-Royce share price? Neutral isn’t really what I’d want though if I held shares in Rolls-Royce right now. I’d be wanting to see it moving higher and trying to head back to 200p or above. The low price today could be a buying opportunity for me, of course. But right now, I don’t have enough information on where the price might go next to warrant me buying the shares, despite that low price.  From one angle, the next move could be higher given the fact that the Rolls-Royce share price has consolidated at current levels for a sustained period. This is a change from the falling price seen for much of 2020. The fact that the price has stopped falling, and is steady, does offer some positivity. From my point of view, to break higher I’d need to see a catalyst. For example, if summer overseas travel restrictions were lifted in the UK, I’d expect the share price to jump. Ultimately, any sign that airline operators will be increasing flights should be positive for Rolls-Royce. Aside from external news like the above, the internal health of the company could drive the Rolls-Royce share price higher. The half-year 2021 results are due out in the first week of August. If cost-cutting measures are on track to save the £1.3bn+ in annual cost savings targeted by the end of 2022, this would be a lift for the shares. More clarity on the restructure (lower capital spend in commercial aviation and more into power systems and defence) could also help. I think the current range around 100p could continue until we get more news out about summer travel plans and half-year results. If both sets of news are positive, then I think momentum could carry the shares to 200p by year end. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Would I buy Rolls-Royce shares or International Consolidated Airlines Group shares? Where will the Rolls-Royce share price go in June? What’s happening to the Rolls-Royce share price? Could the Rolls-Royce share price fall below 100p? This is what I’m doing about the Rolls-Royce share price! jonathansmith1 has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Will the Rolls-Royce share price ever get back to 200p? appeared first on The Motley Fool UK.
    [visit article]
  6. Would I buy Rolls-Royce shares at 100p? (30/07/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE:RR) share price slumped from 200p to around 100p during the coronavirus market crash in March 2020. The price of the blue-chip stock continued to fall all the way to 35p in October 2020, but has since recovered to around 100p at the time of writing. Rolls-Royce did suffer during the pandemic as it is heavily exposed to the airline sector. It does not make much money on initial engine sales. But, it does make money from monitoring and servicing them. The more time planes spend flying, the better for Rolls-Royce. Since planes were grounded during the pandemic, it stands to reason that Rolls-Royce would take a financial hit. The company booked a net loss of £3.2bn for 2020 and did not pay a dividend. But, if the pandemic looks to be ending, and planes are flying, Rolls-Royce, and its share price, should be fine, right? I don’t think so. I think a lot of the commentary on Rolls-Royce is too short-sighted. Yes, the pandemic might have been the straw that broke the camel’s back, but Rolls-Royce and its shareholders have been struggling for years. Rolls-Royce has been struggling for years I think it would be a mistake to assume that once the pandemic is over, the Rolls-Royce share price will recover. Since the high of near 400p in January 2014, the Rolls-Royce share price has headed lower, albeit with periods of respite. When I look at the company’s financial performance, its multi-year stock price slide is not surprising. Gross margins have contracted every year since 2015 and even turned negative in 2020. Operating margins have been negative since 2018. The company made a profit in 2015 and 2017 but posted losses in 2016, 2018, 2019, and 2020.   2015 2016 2017 2018 2019 2020 Gross Margin 24% 20% 16% 8% 6% (1.78)% Operating Margin 11% 0% 8% (5)% (4)% (17.72)% Net Income Margin 1% (27)% 23% (15)% (8)% (26.80)% Rolls-Royce has raised billions in equity and debt to shore up its balance sheet during the pandemic. This will dilute shareholder returns for years to come. There are also current and future restructuring charges for shareholders to contend with, as Rolls-Royce tries to turn things around, perhaps balanced by cash from asset and business sales. Rolls-Royce share price Rolls-Royce’s turnaround requires air travel to get back to normal as it gets about half its revenues from its commercial aviation business. Optimistic projections have passengers taking to the skies as normal as early as this year. Others think 2035. Whatever the case, Rolls-Royce’s Trent family engines power wide-body aircraft. Narrow-body aircraft that make shorter flights seem to be where the recovery will happen fastest. Returning Rolls-Royce to its pre-pandemic state is not something I would be relishing as a shareholder. It needs to do more than that. Rolls-Royce is part of the consortium that won a £250m contract to develop the UK’s next-generation combat aircraft called Tempest. The company is leading a consortium hoping to build small modular nuclear reactors, which the current UK prime minister backs as part of his 10-point plan for a Green Industrial Revolution. Rolls-Royce’s UltraFan engines will power narrow-body aircraft, diversifying it away from wide-body planes. But those new engines won’t be in service until 2030, and those reactors and the Tempest aircraft could take even longer to enter service. I see Roll-Royce shares as a speculative recovery play at this stage, which could take years to pay off. I think there are better shares for me to buy than Rolls-Royce, even at 100p. The post Would I buy Rolls-Royce shares at 100p? appeared first on The Motley Fool UK. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? 2 FTSE 100 shares I’m buying after ‘freedom day’ The Rolls-Royce share price could be on the road to recovery I’d avoid the Rolls-Royce share price and buy this FTSE 100 stock instead Can the Rolls-Royce share price hold out until the end of 2021? James J. McCombie has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  7. The Rolls-Royce share price zooms past 100p. What’s next? (03/08/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) releases its first-half numbers only the day after tomorrow. But in what looks like a good omen, if one believes in such things, the Rolls-Royce share price is already rising. It zoomed past 100p yesterday. And has stayed above these levels in today’s trading, after remaining just below 100p for much of the last month.  Selling off non-core business This uptick follows the likely sale of its Norway based maritime engines’ business, Bergen Engines, to the UK’s Langley Holdings. It had earlier tried to sell it to a Russian company, but the Norwegian government had stopped the sale for security reasons. The news would have been disappointing at any time. But at a time when Rolls-Royce has been struggling, it sounded even more so. A share price dip coincided with this occurrence. Travel demand picks up There are other positives too. A pickup in travel demand during the summer month augurs well for its civil aircraft engines’ business, which has been particularly challenged in the past year. Switzerland headquartered low-cost airline Wizz Air, for instance, expects demand to be back to pre-pandemic levels this month.  Similarly, the International Consolidated Airlines Group that owns British Airways expects to fly at up to 75% of its pre-pandemic capacity in the final quarter of 2021. Similar statements have been made by other airlines, as my colleague Christoper Ruane pointed out in an article yesterday.  New defence contract It has also just got a contract from the UK’s Ministry of Defence, to design and develop Tempest, a fighter jet. This will combine the expertise of various entities, including BAE Systems. Rolls-Royce had mentioned increased funding by the UK government in its last trading update in May, including that for a future combat air system. This latest development is a positive follow up from there.  What to expect from the Rolls-Royce results Based on these, I see why the Rolls-Royce share price is rising. But for it to rise sustainably, ultimately its numbers need to look better. And aero-engines for the civil aviation segment is its big revenue making segment. The half-year results for 2021 can be expected to look fairly poor keeping this in mind. We have lived through yet another lockdown for much of this time, and it is only now that signs of improvement are visible.  I am interested in two aspects of its results though. The first is its outlook, which can help me assess how much increase can be built in when figuring out its future share price trajectory. The second is the growth in its power systems and defence segments, both of which were profit-making at the last reported count.  What I’d do about the Rolls-Royce share price If Rolls-Royce’s outlook is sufficiently positive in its half-year results statement, I reckon its share price can rise further. To buy the stock, however, I will wait for more signs of improvement that include a return to making profits. But that can take its time. It is on my watchlist for now. The post The Rolls-Royce share price zooms past 100p. What’s next? appeared first on The Motley Fool UK. One FTSE “Snowball Stock” With Runaway Revenues Looking for new share ideas? Grab this FREE report now. Inside, you discover one FTSE company with a runaway snowball of profits. From 2015-2019… Revenues increased 38.6%. Its net income went up 19.7 times! Since 2012, revenues from regular users have almost DOUBLED The opportunity here really is astounding. In fact, one of its own board members recently snapped up 25,000 shares using their own money… So why sit on the side lines a minute longer? You could have the full details on this company right now. Grab your free report – while it’s online. More reading Will the Rolls-Royce share price rise in August? Can the Rolls-Royce share price return to pre-pandemic levels? Would I buy Rolls-Royce shares at 100p? The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? 2 FTSE 100 shares I’m buying after ‘freedom day’ Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  8. The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? (28/07/2021 - The Motley Fool UK)
    It has been an extremely challenging 18 months for Rolls-Royce (LSE: RR), with the pandemic causing absolute havoc, especially in the civil aerospace division. This has seen the company incur very large losses, and the Rolls-Royce share price even dropped to below 40p at one point. But with the country starting to return to normality, there is some hope that the business can recover. At over 100p, should I therefore be buying this FTSE 100 stock now? The year of 2020 It’s fair to say that the majority of UK companies struggled during 2020. Nonetheless, due to its ties with the aviation sector, Rolls-Royce was one of the biggest strugglers. This was confirmed in the company’s full-year trading update, where it reported a loss of over £3.1bn. Such a large loss included the effects of impairment charges, restructuring costs, and lower revenues. To survive, the firm had to take drastic measures. For instance, at the end of October last year, the company managed to raise £2bn through issuing nearly £6.5bn new shares. Due to the dilution of shares, this caused the Rolls-Royce share price to fall by around 64%. It also limits the likelihood of the share price returning to its pre-pandemic prices, unless the company is in the financial position to buy back some of these shares. There is no possibility of this happening for a long time. On the flipside, this secondary offering of shares, alongside debt issuances, did manage to strengthen liquidity to £9bn. This included £3.5bn in cash and £5.5bn in undrawn credit facilities. The company also hopes to reach £1.3bn in annual cost savings by the end of 2022. All of this means that I am confident the company will survive, and it reduces the risk of investing. This is one reason to buy shares as a recovery stock. What’s next? Of course, with international flights still far below 2019 levels, Rolls-Royce faces a number of challenges. The high number of global coronavirus cases at the moment therefore remains an extremely pressing issue. Despite this, the company still hopes to start generating cash again at some point during the second half of this year. It is also important to recognise that the Rolls-Royce business has more to it than just its civil aerospace division. Indeed, last year, its defence sector accounted for 29% of the firm’s revenues. It also had underlying operating profits of £448m. As such, I believe this sector could have a positive effect on the upcoming half-year results, which may see the Rolls-Royce share price gain further momentum. Can the Rolls-Royce share price rise further? I feel that the Rolls-Royce share price is still in for a very turbulent 2021. Clearly, the civil aerospace division will carry on struggling, and losses look set to continue for the foreseeable future. There is also no proposition of any shareholder returns until at least 2023. As such, while I feel there is some upside potential, and bankruptcy does not seem likely, there are still too many problems with the company for me to invest. The post The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? appeared first on The Motley Fool UK. Is this little-known company the next ‘Monster’ IPO? Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead. Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025. The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential. But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving. Click here to see how you can get a copy of this report for yourself today More reading 2 FTSE 100 shares I’m buying after ‘freedom day’ The Rolls-Royce share price could be on the road to recovery I’d avoid the Rolls-Royce share price and buy this FTSE 100 stock instead Can the Rolls-Royce share price hold out until the end of 2021? 5 reasons to buy Rolls-Royce shares – and why I’m not Stuart Blair has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  9. What’s going on with the Rolls-Royce share price? (12/07/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) is in a funk. Again. The Rolls-Royce share price is trading at below 100p levels today after managing to hold up above these levels for much of the past month.  Much progress for Rolls-Royce This is mystifying. The outlook for aviation is better now than it has been at any time in the past year. Supply and service of civil aircraft engines is Rolls-Royce’s biggest revenue source, so that is good news. Also, its other business segments are in a healthy place.  And Rolls-Royce also has plans in place for the future. It is in the process of forming a partnership with Cavendish Nuclear, an engineering company, to facilitate the development of Rolls-Royce’s small nuclear power plants. In another bid to support clean energy, the company is also set to launch the fastest electric plane.   To me, these look like developments with great potential as we move towards a cleaner, greener future. Whether or not they add to the company’s bottom line remains to be seen, but for now that is tomorrow’s question. Why the share price drop? So why the drop in share price? I think one glaring reason is that the pandemic continues. It is true that vaccinations are happening speedily. It is also true that the intensity of Covid-19 has declined. However, it is equally true that coronavirus cases are on the rise. And while we are all looking forward to ‘Freedom Day’ next week, there is also a possibility that restrictions may come back after the summer. The worst affected from this ongoing uncertainty, is of course the aviation sector.  It is no coincidence then, that Rolls-Royce is hardly the only aviation related stock to decline in the recent months. FTSE 100 airline giant International Consolidated Airlines Group and the FTSE 250 low-cost airline easyJet, are other casualties of this uncertainty.  With constant change in expectations, I can see why investors appear undecided about the Rolls-Royce share price. I had predicted as much, when I wrote about it in May. My takeaway was that its situation is volatile, and that is how it has stayed. Even though by last month, it was beginning to look like I might have been wrong. What would I do now? So what would I do about the Rolls-Royce stock now? I think it is a wait and watch situation for now. Unlike airline stocks, I have been particularly cautious about Rolls-Royce because even pre-pandemic its financial performance left a lot to be desired. So even if all goes back to normal, there is limited confidence in the company’s performance. This will also translate into limited share price increases.  Instead, if I want to buy stocks in the aviation pack, I think the likes of easyJet are a better buy for me. As a low-cost airline its bounce back can be faster.  The post What’s going on with the Rolls-Royce share price? appeared first on The Motley Fool UK. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Can the Rolls-Royce share price rise in the months ahead? Rolls-Royce shares: 1 reason to buy and 1 reason to sell Can the Rolls-Royce share price return to 200p? Is the Rolls-Royce share price cheap at 100p? This is what I’m doing about the Rolls-Royce share price Manika Premsingh owns shares of easyJet. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  10. What’s happening to the Rolls-Royce share price? (29/05/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE: RR) share price has performed poorly over the past few months. Year-to-date, the stock has returned just 3.7%. Over the past 12 months, it is off nearly 10%.  However, over the same time frame, the company’s underlying fundamental performance has improved markedly.  So, what is really happening to the Rolls-Royce share price? Why are investors still giving the stock the cold shoulder despite its improving fundamentals?  Rolls-Royce share price outlook Two weeks ago, Rolls-Royce issued a trading update for the first few months of 2021. The market had been expecting another update from the business following a rough performance from the company in 2020. Towards the end of last year, management had stated that the company was on track to become free cash flow positive by the second half of 2021. Investors were waiting to see if the company still believed this was possible. As it turns out, management believes it is. According to the company’s latest trading update, management sees it reaching this goal as vaccinations bring the pandemic under control and travellers return to the skies.  This is incredibly positive news. The Rolls-Royce share price has been under pressure for much of the past year due to concerns about the company’s balance sheet and rising losses. The fact that management believes the group will be free cash flow positive at some point in the next six-to-nine months suggests these balance sheet pressures are now behind it. If the company meets its cash flow target, it can focus on growth, but this could be a long way off yet.  Risks and challenges Unfortunately, the company is not out of the woods yet, despite the progress it has made over the past few months.  Vaccinations are making a big impact, but outbreaks are still occurring around the world. It could be several years before the group returns to 2019 levels of sales and profitability. In the meantime, management will have to remain laser-focused on keeping costs low and maximising profitability. Another significant coronavirus outbreak could cause massive disruption. This would undoubtedly throw a spanner in the works of the company’s recovery plans. It may even have to raise more cash from investors if losses return.  I think this is the primary reason why the Rolls-Royce share price has performed the way it has in 2021. Yes, the company seems to be through the worst of the storm, but it still faces a long road to recovery. And any setback could force the business to make some hard choices.  With that being the case, I’m not going to be buying a large holding in Rolls-Royce any time soon. I might be tempted to take a small position, but considering the risks facing the enterprise, I reckon there are better opportunities on the market that would prevent me spending a lot on RR shares. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading Could the Rolls-Royce share price fall below 100p? This is what I’m doing about the Rolls-Royce share price! As the Rolls-Royce share price remains cheap, I’d invest £3k Is it time to act on the Rolls-Royce share price? Can the Rolls-Royce share price stay above 100p? Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post What’s happening to the Rolls-Royce share price? appeared first on The Motley Fool UK.
    [visit article]
  11. The Rolls-Royce share price is above 100p: what next? (16/03/2021 - The Motley Fool UK)
    In the last six months, the Rolls-Royce (LSE: RR) share price has been as low as 40p per share and as high as 140p. Now back above the possibly important psychological marker of 100p, would I add the engineer’s shares to my portfolio? What’s happening with the Rolls-Royce share price? It’s worth noting that although the shares have increased a lot over the last month, over a longer timeframe they’ve performed poorly. In 2018, the shares reached 375p. In early 2014 they were over 400p. Even comparing Rolls-Royce to another engineer like Weir Group or Melrose, shows that its share price has underperformed. Weir and Melrose have made gains over the last 12 months, while Rolls-Royce has lost ground.   That could either mean Rolls-Royce could bounce back stronger, or that there are just greater concerns about the company versus other broadly comparable businesses. I fear it may be the latter. Yet the last month has been a bit stronger. This momentum has, I think, more to do with the rotation to value stocks over growth stocks, rather than specifically a vote of confidence in Rolls-Royce itself. More than just a temporary blip Covid only amplified problems that Rolls-Royce had. It wasn’t firing on all cylinders before the pandemic, as I have pointed out before. There were issues with cash flow and its Trent 100 engines, to give just two examples. Neither of these can easily be ignored, they are pretty major problems.  Even as Covid fades, and we have a roadmap in the UK out of lockdown, there’s still a lot of uncertainty around the engineer. Its wide-body planes will likely be less in demand for now, even as air travel increases. That’s because I’d suspect most people will likely take short breaks until they feel comfortable flying long-haul again. That means lower demand for bigger planes.  The impact of the pandemic will likely hurt its cash flow for years too. This year it’s expected to spend £4.2bn. Turning this situation around will take a lot of management time and require a lot of action, including likely further cost-cutting.  Those issues with the Trent 100 engines are still not fully resolved and have been eating up profits even before the pandemic. It’s hard to quantify what impact this has on the firm’s reputation, but it can’t do the brand any good.  What could help boost the shares? On the flipside of this gloomy picture we have both short-term and long-term opportunities. In the short term, the share price could benefit from being seen as a Covid recovery share. Longer term, reliable defence income and moving into new emerging technologies, such as modular nuclear reactors, could boost growth and investor sentiment. In the end the simple answer to the question of whether I’d add Rolls-Royce shares to my portfolio is probably not. For me there are other Covid recovery stocks that are better value and that could make for more profitable long-term holdings. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Rolls-Royce share price: I think we’ve seen the bottom I’m tempted by the Rolls-Royce share price. Here’s why I’m not buying FTSE 100 stock watch: will the Rolls-Royce share price recover? The Rolls-Royce share price holds steady after big 2020 loss. Should I buy? Rolls-Royce share price: can it go back up to 200p? Andy Ross owns no share mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price is above 100p: what next? appeared first on The Motley Fool UK.
    [visit article]
  12. Rolls-Royce share price: what’s in store in the coming months? (26/04/2021 - The Motley Fool UK)
    Rolls-Royce (LSE:RR) was one of the biggest losers of the stock market crash caused by Covid-19 last year. What is ahead for the Rolls-Royce share price in the coming months, and is there an opportunity here for me to pick up cheap shares? Rolls-Royce share price woes Between February 2020 and September 2020, the Rolls-Royce share price lost 80%. Across the whole of 2020, the Rolls-Royce share price declined by over 50%. Its debt levels rose as it borrowed to keep the lights on, and it also cut jobs and announced a rights issue to generate cash flow. In December, the Rolls-Royce share price experienced its highest post-Covid-19 price. Shares were trading for 135p per share. Since that time, however, the share price has fallen over 20%.  Challenges and outlook ahead Airlines are operating more than at this time last year. The issue here is that Covid-19 is still rife and there could be further restrictions if another wave hits. In terms of Rolls-Royce, I believe the overall outlook is improving. I do believe, as I write, the worst of the crisis is over. It has taken the necessary steps to see it through some tough times and has begun to shore up its once-beleaguered balance sheet. There are still some challenges it needs to overcome, however. In a recent trading update, Rolls-Royce predicted a free cash outflow in the region of £2bn in 2021. This is money that is going out of the business that its management team will need to find from somewhere. In the same update, it did mention its £9bn liquidity, which is a good sign in my opinion. This should help with the cash outflow mentioned. The Rolls-Royce share price could benefit in the future if ambitions are achieved. It believes it can generate over £700m of free cash flow by 2022. This is a projection based on past figures and flying hours of engines. Cash is king and this could put Rolls-Royce in a much better position.  My verdict I believe there is lots of recovery potential linked to the Rolls-Royce share price. The issue I have is that this recovery is linked to Covid-19. I don’t think it can handle another scenario whereby planes are grounded and it faces severe losses. It must be noted that different parts of the world are in different states related to the virus. The US seems to be flourishing from an aviation perspective and is a market Rolls-Royce can capitalise on. Asia is struggling right now with a deadly variant, and there seems to be another lockdown on the horizon over there. I believe the current Rolls-Royce share price is not reflective of its improving stature, and I think it will creep up over the coming months. I class it as a high-risk investment but I think it is priced quite low right now. It could make an interesting recovery play for my portfolio. Right now, I would not invest in Rolls Royce shares but will keep a keen eye on developments.  Away from Rolls Royce, here is a tech stock that recently underwent an IPO that I have examined. CEO’s £500,000,000 Stake on Industry’s “Uber” Revolution We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading As the Rolls-Royce share price falls, I’m still buying Will the Rolls-Royce share price recover in the second half of 2021? Why I think I could double my money with the 100p Rolls-Royce share price The Rolls-Royce share price is crashing in April! Should I buy RR today? Does the Rolls-Royce share price make me want to buy in 2021? Jabran Khan has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce share price: what’s in store in the coming months? appeared first on The Motley Fool UK.
    [visit article]
  13. Will the Rolls-Royce share price rise in August? (02/08/2021 - The Motley Fool UK)
    Shares in Rolls-Royce (LSE: RR) have lately been showing the sort of movement more associated with the company’s engines. Moving down to become a penny share and now gaining altitude again, the shares have certainly encountered some heavy weather. But the Rolls-Royce share price is 30% higher than it was a year ago. Can it now go higher? Demand recovery is in progress One of the drivers for the Rolls-Royce share price is the utilisation rate of its installed engine base. They higher the flying hours, the greater the need for servicing. That is good for Rolls-Royce’s service revenues. There have already been signs of growing civil aviation demand recovery in markets like the US. Recently there has been similar news closer to home. Last week, for example, Ryanair said that it is seeing “a strong rebound of pent up travel demand into August and September” which it expects will continue in the following months. Rival Easyjet referred to “bookings surges experienced following selective easing of travel restrictions”. That sort of improvement in the number of passengers taking flights should be good for the Rolls-Royce share price, as long as it is sustained. The company also derives revenues from a number of businesses apart from civil aviation, such as defence. Performance in those business units has not weakened as much as that of the civil aviation division during the pandemic. If civil aviation demand continues to improve, I think Rolls-Royce could soon be reporting stronger performance throughout its business. That could help boost the Rolls-Royce share price. Cash flow news this week The company is set to release its interim results this Thursday. I think that could be an important event for the Rolls-Royce share price. Part of the nervousness investors have had about Rolls-Royce is its liquidity. Will it need to repeat the very dilutive rights issue it had last year? The company has repeatedly said that it expects to become cash flow positive in the second half of this year. If it does that, investors’ liquidity concerns will ease. That could help boost the share price. If Thursday’s results are good, that could lift the Rolls-Royce share price. But the thing I will most be keeping my eye on is the cash flow news. I expect the company to update on its target in the interim results. If it says it still expects to become cash flow positive in the second half – which is now underway – I see it as positive for the Rolls-Royce investment case. Rolls-Royce share price outlook for August So, what does that mean for the Rolls-Royce share price in August and beyond? If the interim results are strong, I think it could provide a boost for the shares. I therefore think that the Rolls-Royce share price could rise in August. But I also see risks. Demand recovery may be slower than expected, hurting the restoration of positive cash flow. Further lockdowns could mean future demand falling again. The dilutive rights issue last year points up the risk of any future liquidity crunch leading to further dilution. I’ll be digesting Thursday’s results eagerly, but for now am not tempted by the Rolls-Royce share price. The post Will the Rolls-Royce share price rise in August? appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading Can the Rolls-Royce share price return to pre-pandemic levels? Would I buy Rolls-Royce shares at 100p? The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? 2 FTSE 100 shares I’m buying after ‘freedom day’ The Rolls-Royce share price could be on the road to recovery Christopher Ruane has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  14. Can the Rolls-Royce share price rise in the months ahead? (12/07/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE: RR) share price has followed a disappointing trajectory over the past few years. Climbing to 130p near the end of 2020, it seemed the stock may have been gaining momentum. However, this was not the case. Currently sitting at 97p, the Rolls-Royce share price has hovered around the 100p mark for most of 2021. It’s up only 6% year-on-year and this raises the question: can the share price rise higher over the next few months? Rolls-Royce share price problems The pandemic hit Rolls-Royce hard. The firm was forced to cut 7,000 jobs in the face of a £4bn loss for 2020. Rolls makes most of its money servicing aeroplane engines, but with the travel industry grinding to a halt during the pandemic, business dried up. This forced the company to issue 6.4bn new shares in October 2020. While this raised £2bn, it halved the value of the share price, vastly reducing the earnings per share. 2020 was a bad year for Rolls-Royce, but the firm was experiencing problems even before the pandemic. In 2019, problems with its Trent 1000 engines forced the firm to fork out nearly £800m. This raised the total cost of Trent 1000 engine setbacks to £2.4bn for 2017-23. These expenses put a huge strain on free cash flow, something the firm could not afford going into the pandemic. Results dependent On 5 August, Rolls will be publishing its half-year results. This will offer investors insight into the future direction of the business. The firm itself has set out several targets for the last six months of 2021 and for 2022. These include turning free cash flow positive by the end of 2021 and achieving annualised savings of over £1.3bn by the end of 2022. The half-year results should give investors a closer idea of the progress of these targets. If targets are looking achievable, I believe we will see positive growth in the Rolls-Royce share price. However, these targets are heavily reliant on the increase of engine flying hours. If travel problems linked to the pandemic persist, it could vastly reduce the likelihood of these targets being reached. Will the shares climb higher this month? I expect the August results will be a good indication of the direction of the Rolls-Royce share price in the coming months. However, this month’s share price will rely on a broader range of factors. The UK is set to abandon all Covid-19 restrictions on 19 July. If this is pushed back (again) it will likely hinder any immediate Rolls-Royce share price growth. In addition to this, in an interview with Bloomberg this month, Engineering and Technology Director Simon Burr asserted his optimism in moving beyond the Trent 1000 jet engine problems. Encouraging statements like this are great for investors’ confidence and could help drive up the Rolls-Royce share price. I think it’s hard to say if the share price will rise in the immediate future. It has shared its plans to overcome 2020 problems and the August results should highlight the probability of these targets being achieved. If the results bring good news, I think we could see a rise in the Rolls-Royce share price immediately afterwards and in the coming months. The post Can the Rolls-Royce share price rise in the months ahead? appeared first on The Motley Fool UK. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading Rolls-Royce shares: 1 reason to buy and 1 reason to sell Can the Rolls-Royce share price return to 200p? Is the Rolls-Royce share price cheap at 100p? This is what I’m doing about the Rolls-Royce share price Should I buy Rolls-Royce shares today? Dylan Hood has no positions in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  15. Rolls Royce? (24/02/2021 - Reddit Stocks)
    Hey everyone. Just wondering what the thoughts on rolls royce are? The pandemic really hit their price hard. Dropped from £10 to just under £1. The beloved British company recently just won a contract in India too. I won't go I to too much details. All details are at your fingertips.   submitted by   /u/TopSeaworthiness7501 [link]   [comments]
    [visit article]
  16. Rolls-Royce shares: 1 reason to buy and 1 reason to sell (11/07/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) was one of the companies hardest hit by last year’s stock market crash. It didn’t really partake in the late 2020 recovery either. And the Rolls-Royce share price is still down around 65% over the past two years. Pandemic meant lockdown, lockdown meant nobody flying. Nobody flying meant no aircraft engine maintenance. Well, there was some, but well below normal levels. But with the end of Covid restrictions moving ever closer, many are heading off on their hols again. And that’s my chosen reason I’d think of buying Rolls-Royce shares. In a recovery situation, I want to see a troubled company’s business starting to pick up again. Or, at least, strong indications it’s about to happen any day now. I’m hoping we’ll see some hard evidence of recovery with first-half results, due on 5 August. Rolls-Royce share price: ready for the rebound? I think we might see a spark of interest in the Rolls-Royce share price in the days leading up to that. But in the meantime, I’m buoyed by the firm’s AGM statement from May. Chief executive Warren East said: “Looking ahead, we are confident that the significant restructuring actions we have taken in 2020 will deliver permanent cost reductions, positioning us well for the rebound in international air travel.“ So we have a leaner and more cost-efficient Rolls-Royce now, and that’s maybe not a bad thing anyway. I’ve always liked the company ,and from this direction it looks like a ‘buy’. But what’s the other angle, and why might I rate it a sell? In a word, cash. Rolls-Royce needed to take on a whole new financing deal just to keep going. Part of that involved raising around £2bn from disposals. But the company also raised £7.3bn from new debt and equity. That was in a year that resulted in a pre-tax loss of £2.9bn, and a free cash outflow of £4.2bn. Share price valuation Those are scary, scary numbers. And they make all previous valuation metrics utterly meaningless. With the degree of restructuring that’s been needed, we’re essentially looking at an an entirely new version of Rolls-Royce now. And it’ll surely take some time for markets to settle on a sensible long-term valuation. It’ll definitely take me some time to work out where I think the Rolls-Royce share price should be. I can’t see things settling this year. The company said it’s targeting positive free cash flow in the second half of 2021. And it hopes to reach at least £750m by 2022. If that comes off, my confidence will be boosted. But there’s still significant risk here. And my biggest fear is that the cash could run out and Rolls-Royce might need further financing. If that happens, a resulting combination of more debt and more equity dilution would throw all valuation measures further up in the air again. Hopefully, we’ll get a clearer idea of how the financial picture is looking once we have those H1 figures. Until then, I’m just watching. The post Rolls-Royce shares: 1 reason to buy and 1 reason to sell appeared first on The Motley Fool UK. Is this little-known company the next ‘Monster’ IPO? Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead. Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025. The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential. But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving. Click here to see how you can get a copy of this report for yourself today More reading Can the Rolls-Royce share price return to 200p? Is the Rolls-Royce share price cheap at 100p? This is what I’m doing about the Rolls-Royce share price Should I buy Rolls-Royce shares today? Where will the Rolls-Royce share price go in July and beyond? Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  17. Rolls-Royce shares are below 100p. Should I buy? (30/06/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) shares have caught my eye as they’ve fallen below 100p. So far this year the stock has decreased by over 4% and is flat the past 12 months. So should I buy now at the current level? Well, I’ve been bullish on the company for some time and I’d use this opportunity to snap up some shares. Why have Rolls-Royce shares been falling? A significant portion of Rolls-Royce’s revenue is derived from civil aerospace. This is where it delivers and services aircraft engines. So naturally, any negative news regarding travel restrictions is going to hit the stock. The Delta coronavirus variant has been spreading across the UK and there are concerns that countries will start to to restrict travel for any visitors coming from here. This clearly doesn’t bode well for the travel industry and has cast doubts on when the sector will resume any kind of normality. So just when I thought that sentiment towards travel was improving, investors are worried about the implications of rising Covid-19 cases in the UK. This uncertainty has hit Rolls-Royce shares. The positives I don’t think all is lost though. There are a few reasons why I’m bullish about the company.We have a new health secretary, Sajid Javid, right in the middle of another wave of rising Covid-19 cases. And yesterday, he confirmed that the UK remains on track for ‘Freedom Day’ on 19 July. Also, the green list of countries that people can fly to has been expanded. This is encouraging news and I don’t think should be overlooked. While the number of coronavirus cases is increasing, I’m glad that the number of fatalities remains very small. The vaccines appear to be working and the continued rollout of the jabs should be positive for Rolls-Royce shares. Of course there’s no guarantee Freedom Day will happen. A further rise in Covid-19 cases could result in its date being pushed back further. This would mean that the travel industry may experience another lost summer like last year. This would hit the engine maker’s revenue and could impact the share price negatively. Broker view As I mentioned, I’m upbeat about Rolls-Royce shares. And investment bank Berenberg named the stock one of its ‘key picks’ in civil aerospace earlier this month. In fact, the analysts argued that the deep restructuring should drive bigger operating margins within three to five years in comparison to pre-pandemic levels. If this does happen, it could mean that Rolls-Royce has emerged out the crisis in better shape. It kept its ‘Buy’ rating from Berenberg with an unchanged price target of 150p. My view I don’t expect it to be smooth sailing for Rolls-Royce, but I reckon there’s light at the end of the tunnel for the company. I agree with Berenberg that the cost-cutting will help and means that it’s operating from a low base. This should work in the firm’s favour and hence, I’d buy the stock. The post Rolls-Royce shares are below 100p. Should I buy? appeared first on The Motley Fool UK. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading The Rolls-Royce share price: 3 things that could give it a boost Should I buy FTSE 100 shares BP or Rolls-Royce for my ISA in July? Top British stocks for July Can the Rolls-Royce share price maintain its momentum? The Rolls-Royce share price is up 170%. Should I buy now? Nadis Yaqub has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  18. Will this news help get the Rolls-Royce share price moving? (04/08/2021 - The Motley Fool UK)
    When it was feeling the financial squeeze last year, Rolls-Royce (LSE: RR) needed to raise cash and cut costs. Part of that was to refocus by disposing of non-core assets. We heard further news of that Wednesday though, as I write, the Rolls-Royce share price hasn’t really moved in response. In the latest move, Rolls is selling Bergen Engines, its medium speed liquid fuel and gas engines business, to Langley Holdings. The deal is worth an enterprise value of €63m, funded from Langley’s cash reserves. Rolls had previously tried to sell Bergen Engines to a Russian firm. But the Norwegian government stepped in to put a stop to it on security grounds. Rolls told us the disposal will help towards its target of raising at least £2bn in disposals. It said: “Proceeds of €70m from the transaction together with €40m of cash currently held within Bergen Engines which is to be retained by Rolls-Royce, will be used to help rebuild the Rolls-Royce balance sheet in support of our medium-term ambition to return to an investment grade credit profile.” That investment-grade credit profile target could be key. Once it reaches that point, future borrowing should become easier and cheaper to obtain. Rolls-Royce share price not there yet On its own, this total of €110m isn’t going to provide a turnaround point. And I’m not surprised the Rolls-Royce share price hasn’t responded more strongly. But the shares have been picking up steadily over the past few weeks. And the latest news comes just a day before first-half results. If the balance sheet is looking good on 5 August, this modest extra boost might just make an important difference. There’s been other good news too, with air travel finally starting to show some meaningful progress. British Airways owner International Consolidated Airlines reckons it’s going to be back to around 75% of pre-pandemic capacity in the final quarter of 2021. Still, I do understand if investors remain cautious. We have had a few overenthusiastic earlier false starts. And those share price pick-ups that never really got going in the past six months are there to remind us. H1 results expectations So what do I expect from H1 results? I’m really not interested in profit figures, which aren’t going to be good. No, I’ll be paying attention primarily to the balance sheet and what the debt situation is looking like. Then I’m hoping we might get some upgraded full-year guidance. In particular, any improvement in the cashflow situation would be very welcome. And it could give the Rolls-Royce share price a boost on the day. Would I buy now? There are still economic risks ahead, and the Covid-19 Delta variant hasn’t gone away. So I’m still cautious over the aviation business for the rest of the year. But I can’t help feeling the balance is swinging in favour of Roll-Royce now. It’s definitely one I’ll be watching closely as a possible ‘buy’ later in the year. The post Will this news help get the Rolls-Royce share price moving? appeared first on The Motley Fool UK. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading The Rolls-Royce share price zooms past 100p. What’s next? Will the Rolls-Royce share price rise in August? Can the Rolls-Royce share price return to pre-pandemic levels? Would I buy Rolls-Royce shares at 100p? The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  19. 2 reasons to buy Rolls-Royce at $1.70 (19/03/2021 - Reddit Stocks)
    My thesis for buying $RYCEY (Rolls-Royce) is this simple line here: “In terms of their aims, management has a goal of developing low carbon solutions for hybrid, hydrogen, and electric powered craft"?????? 1.) I think 2021/22 might be a better year 2.) Free cash flow for these new green solutions 2 reasons to buy Rolls Royce   submitted by   /u/xsweeperx [link]   [comments]
    [visit article]
  20. Where will the Rolls-Royce share price go in June? (31/05/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) has had one of the rockiest rides of the pandemic. Rolls has been up and down so far in 2021, going nowhere really in May. And we’re still looking at a fall of more than 60% over the past two years. Now, I’m going to say right up front, I’ve no idea where the Rolls-Royce share price is going to go in June. But we’re heading for developments that should affect the longer term. And I still can’t work out whether to buy Rolls-Royce shares as a recovery pick. For one, the next step in pandemic opening up is scheduled for 21 June. On that day, the government has pencilled in the removal of the final legal restrictions on social and business movements. Saying that, there’s that Indian variant thing. And the Prime Minister has already said we might have to wait a bit longer to get our full freedoms back. Further delays could see the Rolls-Royce share price weaken in June. Still, the opening up that we’re already enjoying is having its effect. In particular, sun-seekers are heading for the beaches again. And some travel-related shares are recovering. International Consolidated Airlines shares are up 26% so far in 2021, with easyJet not far behind with a 21% gain. TUI hasn’t had such a good year so far though, dropping a few percent. And the Rolls-Royce share price is down 4%. Rolls-Royce share price drivers It’s probably going to be a while before the travel sector recovery feeds through to Rolls-Royce. It’ll take time before engine maintenance requirements start to ramp up again. The other critical thing is that Rolls-Royce suffered big loss in 2020, and needed a major financial rescue package. There’s still cash on the books to keep the aerospace engineer going for a while yet. But will it be enough to last until profits return? The uncertainty behind that question must, surely, weigh heavily on the Rolls-Royce share price for at least a few months yet. At full-year results time, Rolls wasn’t in a position to make much in the way of predictions. That’s not surprising, as the company spoke of the uncertainties of the near- and medium-term outlook for civil aviation. It’s all about cash And we shouldn’t expect the cash situation to reverse in the current year. With those results, Rolls said it expects free cash flow to turn positive in the second half of 2021. But it still expects to suffer a free cash outflow of around £2bn for the full year. The company is hoping for positive free cash flow in 2022 of at least £750m. But that depends critically on the pace of recovery in flying hours, and the success of the firm’s cost-cutting strategy. I’m keenly awaiting first-half results due on 5 August. Any updates on the expected cash flow situation could drive the Rolls-Royce share price in either direction. In the meantime, any positive news from the aviation business in June and beyond would be welcome. I’m not buying yet. I’m going to wait for the clouds of uncertainty to clear a bit. FREE REPORT: Why this £5 stock could be set to surge Are you on the lookout for UK growth stocks? If so, get this FREE no-strings report now. While it’s available: you’ll discover what we think is a top growth stock for the decade ahead. And the performance of this company really is stunning. In 2019, it returned £150million to shareholders through buybacks and dividends. We believe its financial position is about as solid as anything we’ve seen. Since 2016, annual revenues increased 31% In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259 Operating cash flow is up 47%. (Even its operating margins are rising every year!) Quite simply, we believe it’s a fantastic Foolish growth pick. What’s more, it deserves your attention today. So please don’t wait another moment. Get the full details on this £5 stock now – while your report is free. More reading What’s happening to the Rolls-Royce share price? Could the Rolls-Royce share price fall below 100p? This is what I’m doing about the Rolls-Royce share price! As the Rolls-Royce share price remains cheap, I’d invest £3k Is it time to act on the Rolls-Royce share price? Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Where will the Rolls-Royce share price go in June? appeared first on The Motley Fool UK.
    [visit article]
  21. Why I think I could double my money with the 100p Rolls-Royce share price (22/04/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE: RR) share price has been hovering around 100p of late. I think it’s possible I could double my money by buying the stock at this level. There are risks, which I’ll discuss, but I reckon they’re outweighed by the potential rewards. Pandemic casualty It’s no secret the Covid-19 pandemic has severely impacted Rolls-Royce’s business performance, share price and near-term outlook. Its Civil Aerospace division has been hit particularly hard. This division accounted for 52% of the group’s revenue in 2019, but 43% last year after sales slumped 37%. Before the pandemic, management had expected Rolls-Royce to generate at least £1bn of free cash flow (FCF) in 2020. As things turned out, FCF came in negative to the tune of £4.2bn. However, the company was successful in securing additional funds, including from a £2bn rights issue. It ended the year with healthy liquidity of £9bn (£3.5bn cash and £5.5bn undrawn credit facilities). Looking ahead Rolls-Royce’s strengthened liquidity has provided some support for the share price and a good buffer for what management expects to be an FCF outflow of £2bn in 2021. It’s anticipated this outflow will be weighted towards the first half of the year. And that the group will turn cash-flow positive at some point during the second half as air travel recovers. Beyond 2021, management believes positive FCF of at least £750m (excluding asset disposals) is achievable when engine flying hours exceed 80% of 2019 levels. It reckons it can achieve the FCF target as early as 2022. In the medium term, it’s aiming to return to a net cash position driven by FCF generation and £2bn of asset disposals. Rolls-Royce share price and valuation Rolls-Royce’s market capitalisation at a share price of 100p is £8.37bn. The FCF yield on £750m is therefore 9%. At times in the past, when the market has been enthusiastic about the outlook for the company, the FCF yield has been less than half its current level. For example, as recently as two years ago, with a market capitalisation of £18.5bn and forward FCF guidance of £700m, the yield was sub-4%. To my eye, this makes Rolls-Royce’s shares look very cheaply priced today. If the market were to regain a positive outlook on the business’s prospects, and push the share price up to rate it on the kind of FCF yield we’ve seen in the past, I think I’d have every chance of doubling my money from buying the stock today. Risks to the Rolls-Royce share price Management’s base-case scenario of negative FCF of £2bn for 2021 is predicated on engine flying hours at 55% of 2019 levels. Its “severe but plausible downside scenario” assumes approximately 45% (similar to 2020). I don’t see the severe scenario as an existential threat to the company. Management reckons it has sufficient liquidity headroom through to September 2022. However, a below-base-case FCF performance in 2021 would also cast doubt on 2022’s FCF target of £750m. I think this would likely keep Rolls-Royce’s share price depressed for some time. In addition to uncertainty around the timing and pace of air travel recovery, a failure to execute on planned cost savings and asset disposals in a timely fashion could be a setback for the Rolls-Royce share price. On balance though, I think the company’s good liquidity and high investment-return potential, if it delivers on its plans, make the stock very buyable for me. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading The Rolls-Royce share price is crashing in April! Should I buy RR today? Does the Rolls-Royce share price make me want to buy in 2021? 2 ways the Rolls-Royce share price could benefit from the reopening economy Is the Rolls-Royce share price undervalued? Is reopening important for the Rolls-Royce share price? G A Chester has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Why I think I could double my money with the 100p Rolls-Royce share price appeared first on The Motley Fool UK.
    [visit article]
  22. The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet (18/02/2021 - The Motley Fool UK)
    The Rolls-Royce (LON: RR) share price recently jumped back above 100p, after falling below this crucial level at the end of January. This is important because traders and investors tend to look at crucial levels like this to determine a stock’s momentum. A rising price can encourage more buyers, while a falling price can encourage more sellers.  From the perspective of a long term investor, this might not seem that important. However, a rising stock price can make it easier for a company to raise money from its investors. A falling stock price can significantly impact a firm’s ability to raise money, which may jeopardise its future.  Even though Rolls recently upgraded its profit forecasts for the year ahead, it is still struggling. Its outlook is also highly dependent on factors outside of its control. The pandemic has already wreaked havoc on the company’s finances. While light is starting to appear at the end of the tunnel, it could be years before the global aviation industry recovers from the pandemic.  As such, I think the company needs to keep its options open. That will be easier with a higher share price and improved investor sentiment.  Rolls-Royce share price risks As I covered above, I think the business’s outlook is improving. Unfortunately, it continues to face significant risks. These challenges suggest to me that now may not be the best time to buy the stock.  Instead, I’m going to wait to see how the company fairs over the next six months or so. By waiting, I think I will be able to gain more insight into the state of the global aviation industry and its potential for recovery in the months and years ahead. This will allow me to better understand what the future holds for the Rolls-Royce share price.  By sitting on the sidelines, I may miss some of the company’s performance if there is a strong recovery over the next few weeks. However, this is something I’m totally comfortable with. I would rather miss out on profits rather than end up owning a lousy investment. I would also rather wait and see the recovery takes hold rather than jumping in and hoping for the best at the current time. Risks and reward  This is based on my own personal risk preference. Other investors may have a different approach. After all, the company’s outlook has improved dramatically over the past six months. As my fellow writer recently stated, the stock could have the potential to double in the near-term based on its free cash flow estimates. That’s the best-case scenario, but I’m more worried about the business’s worst-case scenario. Rolls may have to raise yet more money from investors in this scenario. That could put significant downward pressure on the Rolls-Royce share price.  The high-calibre small-cap stock flying under the City’s radar Adventurous investors like you won’t want to miss out on what could be a truly astonishing opportunity… You see, over the past three years, this AIM-listed company has been quietly powering ahead… rewarding its shareholders with generous share price growth thanks to a carefully orchestrated ‘buy and build’ strategy. And with a first-class management team at the helm, a proven, well-executed business model, plus market-leading positions in high-margin, niche products… our analysts believe there’s still plenty more potential growth in the pipeline. Here’s your chance to discover exactly what has got our Motley Fool UK investment team all hot-under-the-collar about this tiny £350+ million enterprise… inside a specially prepared free investment report. But here’s the really exciting part… right now, we believe many UK investors have quite simply never heard of this company before! Click here to claim your copy of this special investment report — and we’ll tell you the name of this Top Small-Cap Stock… free of charge! More reading The Rolls-Royce share price is under £1: should I buy today? What I think Covid-19 variants mean for the Rolls-Royce share price Rolls-Royce share price: why I’d follow the Archer Aviation SPAC Rolls-Royce and Cineworld: are these UK shares too risky to buy now? The Rolls-Royce share price is down 66% this year. Here’s what I’d do now Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet appeared first on The Motley Fool UK.
    [visit article]
  23. The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet (19/02/2021 - The Motley Fool UK)
    The Rolls-Royce (LON: RR) share price recently jumped back above 100p, after falling below this crucial level at the end of January. This is important because traders and investors tend to look at crucial levels like this to determine a stock’s momentum. A rising price can encourage more buyers, while a falling price can encourage more sellers.  From the perspective of a long-term investor, this might not seem that important. However, a rising stock price can make it easier for a company to raise money from its investors. A falling stock price can significantly impact a firm’s ability to raise money, which may jeopardise its future.  Even though Rolls recently upgraded its profit forecasts for the year ahead, it’s still struggling. Its outlook is also highly dependent on factors outside of its control. The pandemic has already wreaked havoc on the company’s finances. While light is starting to appear at the end of the tunnel, it could be years before the global aviation industry recovers from the pandemic.  As such, I think the company needs to keep its options open. That’ll be easier with a higher share price and improved investor sentiment.  Rolls-Royce share price risks As I covered above, I think the business’s outlook is improving. Unfortunately, it continues to face significant risks. These challenges suggest to me that now may not be the best time to buy the stock.  Instead, I’m going to wait to see how the company fairs over the next six months or so. By waiting, I think I’ll be able to gain more insight into the state of the global aviation industry and its potential for recovery in the months and years ahead. This will allow me to better understand what the future holds for the Rolls-Royce share price.  By sitting on the sidelines, I may miss some of the company’s performance if there’s a strong recovery over the next few weeks. However, this is something I’m totally comfortable with. I’d rather miss out on profits rather than end up owning a lousy investment. I’d also rather wait and see the recovery take hold rather than jumping in and hoping for the best at the current time. Risks and reward  This is based on my own personal risk preference. Other investors may have a different approach. After all, the company’s outlook has improved dramatically over the past six months. As my fellow writer GA Chester recently stated, the stock could have the potential to double in the near-term, based on its free cash flow estimates. That’s the best-case scenario. But I’m more worried about the business’s worst-case scenario. Rolls may have to raise yet more money from investors in this scenario. That could put significant downward pressure on the Rolls-Royce share price.  The high-calibre small-cap stock flying under the City’s radar Adventurous investors like you won’t want to miss out on what could be a truly astonishing opportunity… You see, over the past three years, this AIM-listed company has been quietly powering ahead… rewarding its shareholders with generous share price growth thanks to a carefully orchestrated ‘buy and build’ strategy. And with a first-class management team at the helm, a proven, well-executed business model, plus market-leading positions in high-margin, niche products… our analysts believe there’s still plenty more potential growth in the pipeline. Here’s your chance to discover exactly what has got our Motley Fool UK investment team all hot-under-the-collar about this tiny £350+ million enterprise… inside a specially prepared free investment report. But here’s the really exciting part… right now, we believe many UK investors have quite simply never heard of this company before! Click here to claim your copy of this special investment report — and we’ll tell you the name of this Top Small-Cap Stock… free of charge! More reading The Rolls-Royce share price is rising this week. Should I buy? The Rolls-Royce share price is under £1: should I buy today? What I think Covid-19 variants mean for the Rolls-Royce share price Rolls-Royce share price: why I’d follow the Archer Aviation SPAC Rolls-Royce and Cineworld: are these UK shares too risky to buy now? Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet appeared first on The Motley Fool UK.
    [visit article]
  24. Can the Rolls-Royce share price return to 200p? (10/07/2021 - The Motley Fool UK)
    At the beginning of 2020, the Rolls-Royce (LSE: RR) share price changed hands for around 232p. But then the coronavirus pandemic struck. As the aviation industry around the world was grounded, the firm had to fight for its survival. Investors, fearing the worst, fled, and the value of the company’s shares plunged. By the beginning of October 2020, the Rolls-Royce share price had fallen below 40p, a decline of 84% from the year-end 2019 level.  Over the past 12 months, the stock has regained some of its losses. The stock is up around 8% over the past year.  And now the aviation industry is starting the claw back its pandemic losses, the outlook for the Rolls-Royce share price is beginning to improve.  I think there’s even a chance the stock could return to 200p at some point in the future.  Rolls-Royce share price outlook Over the past year, the pandemic has forced Rolls to take defensive action. It has reduced activity and slashed thousands of jobs.  The company is a much smaller enterprise today than it was two years ago. This suggests the value of the business has been permanently impaired. Unfortunately, that implies the stock may never return to pre-2019 levels, although this is only a rough guide. It’s impossible to say what the future holds for any stock price.  That’s not to say the Rolls-Royce share price can’t return to 200p. Back in 2019, the stock was changing hands for around 300p. I think it’s unlikely it’ll return to this level anytime soon.  However, management is targeting free cash flow of around £750m in the next two years. If the company can hit this target, it would be trading at a free cash flow yield of about 9%. Peers in the aerospace and defence sector are trading at a free cash flow yield of around 3-5%.  These metrics imply the stock could be worth almost double its current valuation if it hits its free cash flow target.  That is a big IF. The third wave of coronavirus has already disrupted the company’s cash flow target. Another coronavirus wave, or an engineering setback, could blow up these projections.  On a knife-edge  As such, it seems to me as if the stock is on a bit of a knife-edge. It needs everything to go right over the next few years and win more business to hit its growth targets.  If growth doesn’t live up to expectations, investor sentiment may take a hit as the company disappoints yet again.  Based on these takeaways, I’d be happy to buy the stock for my portfolio as a speculative investment. I think it could be incredibly undervalued if everything goes right over the next two to three years. I believe it could get closer to its former heights. Nevertheless, it’s clear this isn’t an investment for the faint-hearted. Any number of other things could go wrong that would cause additional problems across the group.  The post Can the Rolls-Royce share price return to 200p? appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading Is the Rolls-Royce share price cheap at 100p? This is what I’m doing about the Rolls-Royce share price Should I buy Rolls-Royce shares today? Where will the Rolls-Royce share price go in July and beyond? Rolls-Royce shares are below 100p. Should I buy? Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  25. Is the Rolls-Royce share price a bargain at 115p? (04/09/2021 - The Motley Fool UK)
    After drifting below 100p in the middle of July, the Rolls-Royce (LSE: RR) share price has since moved back above 100p. It is currently changing hands around 115p, which is close to its 52-week high of 137p. After this performance, the stock has returned 62% over the past 12 months.  It looks to me as if investor sentiment towards the aerospace group is finally starting to improve. As sentiment improves, the stock price could push higher, although investors may baulk at paying a higher price if the company’s fundamentals do not justify the elevated valuation.  As such, I have been wondering if the Rolls-Royce share price looks cheap at current levels or if it has moved too far too fast.  Rolls-Royce share price valuation  It is always challenging to place a value on loss-making businesses. Unfortunately, Rolls is projected to remain loss-making for the next few years. Moreover, it is difficult to tell if the aviation industry will ever recover to 2019 levels of activity.  Hopefully, the industry will not need to recover fully for Rolls to return to profit. The company slashed operating costs last year in an attempt to rightsize itself in the post-pandemic world. This should help the group pull itself out of the hole it currently finds itself in when the market starts to recover. Rolls posted an underlying operating profit of £307m in the first half of its financial year thanks to these cost reductions. For the full year, the enterprise is projected to report a loss of £162m. Management believes the business will start generating free cash flow over the next 12 months. If it does, that will make it easier for me to value the Rolls-Royce share price. Based on current forecasts, the company will earn £370m in 2022 and as much as £750m in free cash flow. These numbers suggest the stock is trading at a forward price-to-earnings (P/E) multiple of 25 and a free cash flow yield of 7.8%.  I think that free cash flow yield makes the stock look cheap. Other equities are trading at a free cash flow yield of less than 4%. This implies the stock could more than double from current levels.  Just forecasts  However, these are just forecasts at this stage. As I noted above, there is no guarantee the company will hit these earnings and cash flow targets. If it does not, investor sentiment could crumble. If management fails to reduce the cash outflow, Rolls could even have to raise new capital.  With this being the case, while I think the Rolls-Royce share price does look cheap based on management’s growth projections, I am well aware there is a lot that could go wrong between now and the end of 2022. As such, I am not going to buy the stock at current levels. I am happy to wait on the sideline and see what happens to the group’s growth during the next 24 months before taking a position.  The post Is the Rolls-Royce share price a bargain at 115p? appeared first on The Motley Fool UK. Inflation Is Coming: 3 Shares To Try And Hedge Against Rising Prices Make no mistake… inflation is coming. Some people are running scared, but there’s one thing we believe we should avoid doing at all costs when inflation hits… and that’s doing nothing. Money that just sits in the bank can often lose value each and every year. But to savvy savers and investors, where to consider putting their money is the million-dollar question. That’s why we’ve put together a brand-new special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… …because no matter what the economy is doing, a savvy investor will want their money working for them, inflation or not! Best of all, we’re giving this report away completely FREE today! Simply click here, enter your email address, and we’ll send it to you right away. More reading 3 reasons why I’d buy Rolls-Royce shares today I’ll buy Rolls-Royce shares when this happens Will the Rolls-Royce share price rise higher in September? Top British stocks for September The Rolls-Royce share price is climbing again. Here’s what I’d do Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  26. The Rolls-Royce share price: have we seen the bottom? (23/02/2021 - The Motley Fool UK)
    Unlike many UK stocks, the Rolls-Royce (LSE: RR) share price didn’t hit its lowest value during the market crash roughly 11 months ago. In fact, it wasn’t until October 2020 that the valuation hit rock bottom. Since the shares now appear to have settled around the 100p mark, is it now possible to say the company is through the worst and the only way is (slowly) up? And having avoided the shares like the plague since the pandemic first arrived, should I now throw caution to the wind? Here’s my take. Reasons to be optimistic Naturally, the direction of the Rolls-Royce share price will likely be influenced to a great degree by what happens next in the pandemic. So, let’s look at the reasons for being optimistic on this front. The recent drop in infection levels and successful vaccine rollout raises the hope of international travel resuming. Indeed, Boris Johnson stated yesterday that 17 May has been selected as the earliest possible date for this to happen. That’s still a long way away off. But the mere mention of a date should be sufficient to get holidaymakers (and investors) excited. This will likely boost the share prices of listed airlines like IAG, Ryanair and easyJet. One would assume Rolls-Royce will experience a similar uplift by association.   Another reason for thinking the shares may continue ascending in the months ahead is that plenty of my fellow UK investors seem bullish. Rolls-Royce was the fourth most popular buy on investment platform Hargreaves Landsdown last week. In fact, the only companies more in demand were those offering exposure to Bitcoin and the budding medical cannabis sector! On the other hand… Of course, the road ahead may still prove rocky for Rolls. While Boris Johnson has stated that the lifting of restrictions would be “irreversible” this time around, he’s also made it clear the coronavirus data must satisfy four tests at all stages of his roadmap out of lockdown. There’s no guarantee this will be the case. As much as I hate to say it, I think the emergence of a new, deadlier variant of coronavirus isn’t beyond the realms of possibility. It would also be incredibly problematic for the FTSE 100 firm. In such a situation, any thought of air travel recovering would quickly evaporate. As a result, the Rolls-Royce share price would likely head south again.  Perhaps this is why Rolls was also seventh in the list of most popular sells at Hargreaves Lansdown last week.  Opportunity cost For me, however, the biggest reason for continuing to avoid Rolls-Royce hasn’t changed. Namely, the opportunities available elsewhere. At a time like this, I’m asking myself what sort of business will provide me the best return over the long term. Is it one that will still face a huge debt pile and operational difficulties once the coronavirus storm has passed? Or is it one with sound finances, operating in a less cyclical space, that also stands a good chance of growing profits in the years ahead without huge amounts of investment? Perhaps it may even pay a dividend. I’m confident it’s the latter. Have we seen the bottom in the Rolls-Royce share price? I’m cautiously optimistic. But not to the extent that I feel motivated to invest myself. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Rolls-Royce share price is around 100p. Here’s what I’d do Rolls-Royce shares: should I buy? Rolls-Royce share price: how the company is preparing for the air taxi market The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet The Rolls-Royce share price is rising this week. Should I buy? Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price: have we seen the bottom? appeared first on The Motley Fool UK.
    [visit article]
  27. The Rolls-Royce share price could be on the road to recovery (27/07/2021 - The Motley Fool UK)
    With the Rolls-Royce (LSE: RR) share price dropping below 100p, I am tempted to buy this stock before the civil aerospace company’s recovery becomes fully realised. But with possible further damage to the aviation sector brewing because of new variants of coronavirus such as the Delta variant, some investors might see this share as one to be avoided. Here, I explain why I will be betting on a favourable future in 2021 for Rolls-Royce. Another lockdown could be devastating for Rolls-Royce First things first, I need to look at what another lockdown could mean for the Rolls-Royce share price. With no planes in the air due to travel restrictions, Rolls-Royce would continue to lose revenue on its maintenance contracts as these are dependent on airtime. This would be a big blow for the company because these contracts contribute to Rolls-Royce’s main bulk of revenue, whereas the company only just about breaks even on the initial sale. However, this is just speculation for now, and the situation looks a lot better than it did last year. Rolls-Royce is not making any adaptations to its recovery plan for the time being, and with air travel having its busiest weekend since the pandemic hit, I am quite hopeful that this is a sign of positive things to come. Rolls-Royce restructuring programme Following on from its cost saving plan from 2020, Rolls-Royce estimated that it saved £1bn beyond its expectations before the pandemic arrived. The company now aims to reach £1.3bn in operating costs and capital spend savings by the end of next year. Of course, we can see that Rolls-Royce is steadfastly committed to its restructuring programme as it temporarily shut down its plant in Renfrewshire this week. With the company continuing to do good on its word to cut costs, I am convinced that its commitment will lead to more investor confidence on the Rolls-Royce share price. Further, the balance sheet looks a lot healthier than compared to last year, and the threat of bankruptcy is no longer in sight. This is mainly because the company secured £7.3m in additional liquidity in 2020. If the company meets its expectations of turning cash flow positive in the second half of 2021, then I think this success will attract a lot of buyers. This could lead to a very profitable return for me if I add this share to my portfolio before Rolls-Royce announces its interim results on the 5th of August. Will the Rolls-Royce share price recover? The dark times of Covid-19 could very well be behind us, but with this new Delta variant and any more variants to come, the situation could change very quickly. The effects of another lockdown would most likely damage Rolls-Royce’s progress, and its thoughts of turning cash flow positive would become an all-forgotten dream. However, I think that the current situation points in a more positive direction. Passengers are flying again, and the government is putting more countries on the green list. I also have confidence that Rolls-Royce’s restructuring procedure will put it on the road to recovery. Whilst it may still be a bit of a bumpy ride for the Rolls-Royce share price, I will be buying this stock as a recovery play. The post The Rolls-Royce share price could be on the road to recovery appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading I’d avoid the Rolls-Royce share price and buy this FTSE 100 stock instead Can the Rolls-Royce share price hold out until the end of 2021? 5 reasons to buy Rolls-Royce shares – and why I’m not Are these 2 FTSE 100 travel stocks a bargain? Would I buy Rolls-Royce shares at 8-month lows? John Town has no position in the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  28. Why is Rolls-Royce a penny stock? (13/07/2021 - The Motley Fool UK)
    With Rolls-Royce (LSE: RR) trading below a pound, the famous engine maker is now a penny stock. But the Rolls-Royce share price traded higher just a couple of months ago – and I think it could go up again. Turbulence for the Rolls-Royce share price Concerns about demand for air travel meant that companies heavily exposed to it, such as Rolls-Royce, were hard hit after the pandemic started. The shares were climbing earlier this year, but have shed a quarter of their value since their mid-March highs. They are now up just 4% over the past year. There are a number of reasons for that. One reason is the inconsistent pace at which air travel demand is coming back. With each setback, such as delays in lifting restrictions, investors fret about the prospects for Rolls-Royce. That has hit the Rolls-Royce share price. A second reason is the company’s liquidity. It massively boosted liquidity last year. But it did so at the expense of existing shareholders, through a heavily dilutive rights issue. While I think the company currently has ample liquidity, the proven risk of dilution could be dampening enthusiasm for the shares. Quality on the cheap Often, penny stock status suggests concerns about a company’s future business prospects. Undoubtedly a decline in demand for aircraft engine servicing has hit Rolls-Royce hard. Last year it booked a £3.1bn loss. With demand for air travel still significantly below pre-pandemic levels, there is a risk that weakened revenues in the company’s core engines business will weigh on profits again this year – and perhaps beyond. But there are signs of longer-term resilience in the air travel market, including large aircraft order from major airlines. Only a few global aircraft engine makers of scale exist, and Rolls-Royce is one of them. That alone ought to help it return to financial health in future. Add to that the fact that the company isn’t just reliant on civil aviation – and its other business divisions have held up fairly well during the pandemic. So while the Rolls-Royce share price may languish beneath the pound mark for a while yet, I don’t expect it to stay there forever. Where next for the Rolls-Royce share price While I see potential for a higher Rolls-Royce share price, a key question is: what will be the driver to move it? One possible factor could be the release of the company’s interim results, due next month. Rolls-Royce has repeatedly said it expects to become free cash flow positive in the second half of this year. An update on that target at the time of the interim results could lead to a rerating of the shares, either positively or negatively. The effects of the company’s cost savings programme ought also to show up more clearly now than it did before. If it looks like it has cut out costs without damaging Rolls-Royce’s reputation with customers, that could also provide a boost to the Rolls-Royce share price. For now, however, I continue to watch from the sidelines. I do not plan to buy Rolls-Royce shares in the absence of clear evidence of strong, sustained business recovery. The post Why is Rolls-Royce a penny stock? appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading What’s going on with the Rolls-Royce share price? Can the Rolls-Royce share price rise in the months ahead? Rolls-Royce shares: 1 reason to buy and 1 reason to sell Can the Rolls-Royce share price return to 200p? Is the Rolls-Royce share price cheap at 100p? Christopher Ruane has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  29. If you haven’t yet, I recommend looking at this Rolls Royce Long ETF, as Rolls Royce is starting to pick up! Not a financial advisor. (23/02/2021 - Reddit Stock Market)
      submitted by   /u/CranusCranii [link]   [comments]
    [visit article]
  30. Where will the Rolls-Royce share price go in July and beyond? (05/07/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE: RR) share price closed above 125p on one day in March. But that’s as good as it’s got so far this year. It ended June below 100p. Longer term (three, five and seven years), the picture is even grimmer. However, great companies can suffer quite extensive periods of underperformance. Look at Coca-Cola between 1998 and 2006. And look at what it’s done since. Could Rolls-Royce stage a similar recovery? The Rolls-Royce share price in July With half-year results not due until 5 August, short-term movements in Rolls-Royce’s share will be down to three things: Unscheduled news from the company Developments in the wider world that the market perceives as positive or negative for the business Simple market ‘noise’ — fluctuations in the share price for no fundamental reason Unscheduled news In the first trading days of July, the Rolls-Royce share price has climbed back above 100p. This was probably helped by a Bloomberg report on an interview with the company’s engineering and technology director, Simon Burr, last Friday. It seems Rolls-Royce is close to resolving the costly litany of glitches that have plagued its Trent 1000 engines. Bloomberg quoted Burr as saying: “After a difficult three or four years, I feel confident about the durability of the engines and the future.” There’s further potential positive unscheduled news that could come as early as July. Rolls-Royce is awaiting the outcome on its tender for the B-52 new engine programme, “where a decision from the US Department of Defense is expected in the second half of this year.” There’s also a chance of a positive development in July on the company’s programme to raise at least £2bn from disposals by early 2022. Of course, negative news in either of these areas — whether in July or later in the year — wouldn’t be good for investor sentiment. The Rolls-Royce share price longer term The August half-year results should provide some insights into the longer-term prospects for the business and the shares. Management has set a number of financial targets for the second half of 2021 and 2022. Principally: Turn free cash flow (FCF) positive at some point during the second half of 2021 £2bn of asset disposals by early 2022 Annualised savings of over £1.3bn by the end of 2022 FCF of at least £750m as early as 2022 I’m optimistic management will be able to reaffirm these targets in the half-year results. If so, with the targets becoming increasingly within reach, I reckon the market and share price will respond positively. Mind, there’s risk. The FCF targets are “dependent on the pace of the recovery in engine flying hours and underpinned by the restructuring programme.” Risk and reward At the current share price, the yield on Rolls-Royce’s targeted £750m FCF is 8.6%. In more optimistic times, the FCF yield has been less than half this. Now, there’s a risk management’s expectations on the recovery in engine flying hours and FCF targets could turn out to be over-rosy. However, with the size of the FCF yield offering both a margin of safety and significant upside potential, the shares look very buyable to me at their current level. The post Where will the Rolls-Royce share price go in July and beyond? appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading Rolls-Royce shares are below 100p. Should I buy? The Rolls-Royce share price: 3 things that could give it a boost Should I buy FTSE 100 shares BP or Rolls-Royce for my ISA in July? Top British stocks for July Can the Rolls-Royce share price maintain its momentum? G A Chester has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  31. Can the Rolls-Royce share price return to pre-pandemic levels? (02/08/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE:RR) share price has had quite a rough time since the pandemic began. With the travel industry being decimated, the engineering firm saw one of its primary revenue channels shrivel. Meanwhile, its losses skyrocketed, sending its stock crashing down. Recently, the Rolls-Royce share price has been creeping upward. Over the last 12 months, the FTSE 100 stock is up by over 25%. It’s still far from returning to pre-pandemic levels. However, with its half-year results just a few days away, is that about to change? Let’s take a look at what might be in store for the business and whether I should be adding it to my portfolio. The initial collapse of the Rolls Royce share price The management team has had to take drastic measures over the last 18 months. Due to a £3.1bn loss, some serious capital needed to be raised. This resulted in a significant chunk of debt being added to the balance sheet, the suspension of shareholder dividends, and a large number of new shares being issued. The latter, in turn, caused a significant dilution effect that’s partially responsible for the swift decline in the Rolls-Royce share price. But as unpleasant as this was, it seems to have been a prudent move, in my opinion. It enabled the management team to quickly improve the business’s liquidity. And keep the lights on while Covid-19 ravaged the world economy. But now that vaccine rollouts are underway, and travel restrictions are being eased, will the share price finally begin its recovery? The potential for growth Last week, London’s largest airports, Heathrow and Gatwick, reported the biggest surge in passenger traffic since the pandemic began. To me, it’s not surprising. Now that lockdown restrictions in the UK have ended, many individuals and families are determined to go on holiday. And after more than a year in confinement, I think that’s pretty understandable. This is fantastic news for the Rolls-Royce share price. With planes finally returning to the skies, the demand for the company’s maintenance services is bound to increase. As will its gross income. What’s more, with corporate and government budgets becoming less influenced by Covid-19, I think the revenue from Rolls-Royce’s Power Systems and Defence segments is likely to start rising again as well. The bottom line Until the half-year report is released on Thursday, this remains largely speculation. But should the money start flowing again, especially to its civil aerospace segment, then I think it’s likely that the share price will begin to rise once more. Having said that, it could be several years before it returns to pre-pandemic levels. As mentioned earlier, a primary catalyst behind the fall of Roll-Royce’s share price was the dilution effect from issuing new shares. These will eventually need to be repurchased to undo this dilution. But with a large pile of debt to contend with, it could be some time before any share buyback programme is announced, let alone the reintroduction of dividends. Over the long term, a complete recovery may be possible. But for now, I’m keeping Rolls-Royce on my watchlist. It will stay there until the business sheds more light on its current situation later this week. The post Can the Rolls-Royce share price return to pre-pandemic levels? appeared first on The Motley Fool UK. Personally, I’m far more interested in… “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading Would I buy Rolls-Royce shares at 100p? The Rolls-Royce share price hits 100p! Is it time to buy this FTSE 100 stock? 2 FTSE 100 shares I’m buying after ‘freedom day’ The Rolls-Royce share price could be on the road to recovery I’d avoid the Rolls-Royce share price and buy this FTSE 100 stock instead Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  32. The Rolls-Royce share price has fallen. Should I buy? (28/04/2021 - The Motley Fool UK)
    Shares in Rolls-Royce (LSE: RR) have been falling. The Rolls-Royce share price has tumbled 20% from its high last month. Over the past year, the shares have fallen 7%. Below I consider why this might be. I also explain my next move. Reopening prospects mixed Over the past year, the shares have tended to do well when there is optimism about a return to international travel. That is because a large part of the company’s business relies on aircraft engines being used. The more they are used, the greater the demand for servicing. Recently, news about reopening has been mixed. There has been a lifting of some restrictions in the UK, for example. But other markets like India may see fewer flights in the near future. The focus on the timing of broad reopening is important. The sooner flight traffic returns to normal, the sooner the company should be able to staunch its negative cash flow. But I think it is something of a red herring. When assessing the Rolls-Royce share price, I find it helpful to focus on the broad pathway to flight resumption, rather than just a granular calendar view. I expect travel to continue reopening overall even if the progression isn’t smooth. So I am optimistic that Rolls-Royce can return to free cash flow generation. Lack of control Another mitigating factor for the Rolls-Royce share price in my opinion has been the lack of any strong news from the company lately. That reflects the fact that the key drivers for improved performance are external to the company. The directors can’t accelerate the demand for flights, no matter how beneficial that would be for the company. Underlying investment case unchanged Sometimes the stock market generates a lot of noise. Compared to a month ago, I don’t think the future prospects for the Rolls-Royce share price have changed much. The company has not reduced its forecasts. The tough cost controls announced last year continue to take effect. The company still expects to stop bleeding cash in the second half of this year. So if I was bullish about the Rolls-Royce share price prospects, I would see the recent fall as a buying opportunity. I still think the shares could reach 150p this year, as I previously explained. That would be a 45% increase from today’s price in a matter of months. Yet I do not plan to take advantage of the recent share price fall. Why not? Risks to the Rolls-Royce share price The main reason I remain wary of buying Rolls-Royce shares is the lack of control I explained above. Currently the business prospects are mostly hostage to events. That means that even if the company makes its best efforts to prosper, the speed and scale of any recovery is substantially driven by external factors. The main factor is the resumption of flights at close to pre-pandemic levels. While I do expect that to happen at some stage, the timing remains unknown. Delays constitute further risk to the Rolls-Royce share price. I do think the share price could recover its recent losses and more. But for now, I am hunting for other shares that I think are less susceptible to demand shocks. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Rolls-Royce share price: what’s in store in the coming months? As the Rolls-Royce share price falls, I’m still buying Will the Rolls-Royce share price recover in the second half of 2021? Why I think I could double my money with the 100p Rolls-Royce share price The Rolls-Royce share price is crashing in April! Should I buy RR today? christopherruane has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price has fallen. Should I buy? appeared first on The Motley Fool UK.
    [visit article]
  33. I’d buy Rolls-Royce shares despite the big 2020 loss (17/03/2021 - The Motley Fool UK)
    I’ve been bullish on Rolls-Royce (LSE: RR) shares for sometime. Last week the FTSE 100 stock released its 2020 full-year results and I can’t say I was too surprised with what the company reported. I think most of the bad news is out in the open for Rolls-Royce shares. And from here, the company and share price are likely to recover so I’d buy the stock. But here’s what I drew from its recent results. Big hit 2020 wasn’t a great year for Rolls-Royce. Revenue and profitability took a big hit. In fact, total sales were down 24% to £11.8bn. The company also suffered a £4bn loss over the year, which included a £1.7bn finance charge. To be honest, I’m not shocked by the big negative numbers. Investors knew Rolls-Royce’s situation was struggling last year and understandably so given the pandemic. It’s no surprise to me that the Civil Aerospace division suffered the worst impact. Rolls-Royce’s largest business took a nose-dive because of Covid-19 travel restrictions. Its revenue just dried up, which was reflected in the results. But I’ll stop with the negative news now and turn to the reasons why I’d buy Rolls-Royce shares. Liquidity Last year, Rolls-Royce took big steps to improve its liquidity position. It raised money through a rights issue and put further credit facilities in place. So at the end of its 2020 financial year, Rolls-Royce had access to a grand total of £9bn in liquidity, including £3.5bn in cash and £5.5bn in undrawn credit. It expects a cash outflow of £2bn in 2021. This is weighted towards the first half of the year before Rolls-Royce expects cash flow to turn positive at some point in the second half of this year. What I take from this is that the company has enough money to weather the storm in the short term. By my calculations, there’s a wiggle room of £7bn in liquidity provided that things continue as expected. Power Systems & Defence divisions The Power Systems and Defence divisions held up well last year. Both businesses accounted for 23% and 29% of Rolls-Royce 2020 full-year revenue respectively. I’ve mentioned this before, but the Defence business provides Rolls-Royce with some revenue stability and visibility. So I’m not surprised, given that revenues took a hit in 2020, that the Defence division accounted for a larger portion of sales. In 2019, this same division only accounted for 20% of revenue. What I think is pleasing to see is that the Defence business has 90% order cover for 2021. The company also predicts steady growth from this division into the medium term. My view Rolls-Royce is highly dependent on the lifting of travel restrictions and the vaccine rollout. Any delays or setbacks mean a further impact to revenue and profitability. This could also place pressure on liquidity and it may need to raise more money, which would be negative for the shares. I recognise that the recovery from the pandemic will take time and I don’t think the dividend will resume any time soon. But I’m still optimistic about the prospects for Rolls-Royce shares. I think the worst is over for the company and hence I’d buy now. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading Rolls-Royce share price: 2 reasons why I’d buy after earnings The Rolls-Royce share price is above 100p: what next? Rolls-Royce share price: I think we’ve seen the bottom I’m tempted by the Rolls-Royce share price. Here’s why I’m not buying FTSE 100 stock watch: will the Rolls-Royce share price recover? Nadia Yaqub has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post I’d buy Rolls-Royce shares despite the big 2020 loss appeared first on The Motley Fool UK.
    [visit article]
  34. As the Rolls-Royce share price remains cheap, I’d invest £3k (15/05/2021 - The Motley Fool UK)
    Over the past few months, I’ve written several articles explaining why I believe the Rolls-Royce (LSE: RR) share price is cheap.  My analysis of the company is based on its own projections. Management believes the enterprise will become cash-flow-positive in the second half of this year. This may help reinforce the group’s balance sheet and underpin growth. At the same time, the company has said it’s more than enough cash to weather the current uncertainty provided by coronavirus.  However, despite these optimistic management projections, the market still seems to be valuing the business as if it operated in a dangerous position. The Rolls-Royce share price is changing hands at around 100p, which is roughly at the same level as it was at the end of 2020, despite the improved outlook.  And with this in mind, I’d invest £3k to buy the stock for my portfolio today.  Rolls-Royce share price on offer Considering the uncertainties of investing in the aviation industry, Rolls might not be suitable for all investors. The company generates the bulk of revenues from selling aircraft engines. So investors and analysts tend to concentrate on the state of the global aviation industry when analysing its prospects.  This exposure is also behind the group’s significant drop in sales and profitability over the past 18 months. However, the outlook for the global aviation industry is improving rapidly. For example, aircraft manufacturer Boeing sold 82 aircraft in February and logged 51 cancellations. This was the first time since November 2019 that monthly aircraft sales outpaced scrapped orders. While only a difference of 32 planes, it’s a start.  Further, according to a recent trading update, large-engine flying hours in January-April were around 40% of their 2019 level. In the third quarter of last year, this figure was around 29%.  These numbers indicate the outlook for the Rolls-Royce share price is steadily improving, although it could be some time before the group returns to 2019 levels of activity. As such, I view this as a long-term investment, and there are likely to be plenty of bumps along the way.  Turbulence en route  The company’s debt has increased markedly over the past 18 months, and it could be a long time before the aviation industry fully recovers. It may never fully recover. At this stage, it’s impossible to tell what that worst-case scenario would mean for Rolls.  So, while the company’s outlook is improving, I’m going to approach the business with caution. Due to this uncertainty, I’m not willing to invest a large sum in a business. That’s why I’ve settled on a figure of £3,000. I think this will allow me to gain exposure to the stock while minimising downside risk. If Rolls starts to struggle again, the stock could fall back. Reduced exposure will limit my risk of losses.  Put simply, it seems to me as if the market is overlooking the potential of the Rolls-Royce share price. And I want to take advantage of that. It might not be smooth sailing over the next few years, but I think the company has strong recovery potential. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Is it time to act on the Rolls-Royce share price? Can the Rolls-Royce share price stay above 100p? The Rolls-Royce share price has been ticking upwards. Is it time to buy now? The Rolls-Royce share price has fallen. Is now the time to buy? Hargreaves Lansdown investors are buying Rolls-Royce shares. Should I buy too? Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post As the Rolls-Royce share price remains cheap, I’d invest £3k appeared first on The Motley Fool UK.
    [visit article]
  35. Can the Rolls-Royce share price stay above 100p? (13/05/2021 - The Motley Fool UK)
    As I write, Rolls-Royce (LSE: RR) is trading around 104p. This is less than a 1% drop from yesterday’s close and leaves me wondering if it can stay above 100p longer term.  Short-term outlook for the share price In the short term, I think it could well fall below this level. The FTSE 100 index has had a poor start to the day. It is down by 2% as I write. As a result, the broader environment is unsupportive of an upturn in the Rolls-Royce share price. This is particularly bad news on a day that the company released a lukewarm trading update.  Continued weakness in civil aerospace For the January-April period, its preferred performance measure of large engine flying hours was at 40% of levels in 2019. This number was actually slightly lower than the 43% seen for 2020 as a whole compared to 2019.  Considering that more than half of Rolls-Royce’s revenue comes from its civil aerospace segment, continued weakness in flying hours is a downer. If stock markets remain weak, I think it is possible that along with weakness in other FTSE 100 stocks, the Rolls-Royce share price can tumble below 100p as well.  Recovery likely over time But over the next year or two, I think the Rolls-Royce share price stands a good chance of recovery. The first reason I think this is based on its outlook in the rest of its trading update.  It is optimistic about its power systems and defence segments, which together contribute 40% to revenues. As far as the power systems operation goes, Rolls-Royce says that it expects “recovery to accelerate” through the rest of 2021. On defence, it says that it “has continued to perform resiliently with high levels of backlog cover”. It is also currently awaiting the outcome of its tender to the US Department of Defense. It also mentioned increased defence spending announced by the UK government last year.  And it spoke positively of financial developments. Free cash flow is expected to turn positive in the second half of the year. It also reported cost savings of £1.3bn, which shows progress in its restructuring programme. Among other things, the programme aims to reduce its fixed cost base.   Additionally, as the global economy recovers and vaccinations proceed, stock markets can be reasonably expected to remain elevated. Also, travel restrictions will ease, which will impact Rolls-Royce’s civil aerospace business positively. A note of caution  But, in the words of the company itself “guidance remains sensitive to the timing of EFH recovery” (EFH means engine flying hours). I think it is important to keep this in mind, because travel regulations could be in place longer than expected. Just yesterday I wrote about the extension of cruise cancellations by Carnival on pandemic concerns.  My takeaway for Rolls-Royce All things considered though, I think the Rolls-Royce share price could sustainably recover to longer-term 100p+ levels. But right now, its situation continues to be volatile. I would wait for some more recovery in the company before buying the stock.  A Top Share with Enormous Growth Potential Savvy investors like you won’t want to miss out on this timely opportunity… Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!). Not only does this company enjoy a dominant market-leading position… But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks! And here’s the really exciting part… While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes. That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021. Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge! More reading The Rolls-Royce share price has been ticking upwards. Is it time to buy now? The Rolls-Royce share price has fallen. Is now the time to buy? Hargreaves Lansdown investors are buying Rolls-Royce shares. Should I buy too? How much is the Rolls-Royce share price really worth? Will the Rolls-Royce share price fly this summer holiday season? Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Can the Rolls-Royce share price stay above 100p? appeared first on The Motley Fool UK.
    [visit article]
  36. Rolls-Royce shares: is it the right time to buy? (25/02/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) shares are down around 50% in the past year. However, investors who bought the stock during the lows in October have seen their investment grow three times.  The company derives around 50% of its revenue from its civil aerospace segment. This is the reason investors became increasingly cautious about the stock last year. However, the hopes of a positive Brexit deal in October and also the successful raising of capital by the company helped the stock price recover. I would like to understand the pros and cons of investing in this company. Rolls-Royce fundamental analysis Rolls-Royce released its trading update at the end of January. Full-year 2020 free cash flow was in line with the management guidance. They were expecting free cash outflow of approximately £4.2bn for the year 2020.  In my opinion, the company has done well in handling the negative impact of Covid-19 on its business. It was able to achieve more than £1bn in cost savings in 2020. It has set a plan of £1.3bn in cost savings by 2022. Its liquidity position is good, with approximately £9bn at the end of 2020. This figure is at the upper end of the company’s guidance. This liquidity is another reason why I like Rolls-Royce shares. In its December trading update, the company reported that its power systems end markets were seeing some early signs of improvement. Its defence segment business is strong. It has a good order book and 2021 forecast sales are covered. The increase of the UK defence budget is also expected to bode well for the company’s long-term growth.  The Rolls-Royce company has a wealth of technical expertise. In the future, it might enter the air taxi market. My colleague Jay Yao believes that the company has a lot of potential in future aviation technologies.  Risks to consider investing in Rolls-Royce shares It is too early to know exactly the total negative impact of the Covid-19 pandemic on Rolls-Royce. Many companies might have deferred payments which they will have to cover once the market opens up. There is a lot of optimism after Prime Minister Boris Johnson announced the gradual lifting of restrictions. However, there is no guarantee that the full lockdown will be lifted by June. If the lockdown does need to be extended, the company’s 2021 revenue might also fall drastically. This would have a negative impact on the Rolls-Royce share price. Fitch Ratings has downgraded Rolls-Royce’s long-term issuer default rating (IDR) and senior unsecured rating to ‘BB-‘, with the outlook as negative. This is will further increase the interest costs when the company raises debt. The company had a net cash position at the end of 2019 but is expecting a net debt position of £1.5bn to £2.0bn at the end of 2020. The company’s free cash flow forecast for the year 2021 is a cash outflow of £2.0bn. This is based on 2021 widebody flying hours at around 55% of 2019 levels. However, the company expects free cash flow to improve in the second half of 2021, which is positive. Rolls-Royce shares are currently trading at a price-to-sales ratio of 0.64. I understand that there is a lot of uncertainty for the company this year. However, I believe the shares are undervalued and would like to buy the shares this year.  “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading The Rolls-Royce share price: have we seen the bottom? Rolls-Royce share price is around 100p. Here’s what I’d do Rolls-Royce shares: should I buy? Rolls-Royce share price: how the company is preparing for the air taxi market The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet Royston Roche has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce shares: is it the right time to buy? appeared first on The Motley Fool UK.
    [visit article]
  37. The Rolls-Royce share price has dropped. Would I buy it now? (10/09/2021 - The Motley Fool UK)
    Until a few months ago, the Rolls-Royce (LSE: RR) share price was languishing in penny stock territory. But after it reported surprise profits in the last quarter, the stock has been consistently trading above 100p levels.  Rolls-Royce share price tumbles It remains there even now, but the share price has come off some 6% in the past two weeks. At any other time, I may have chalked it up to a routine market fluctuation, that can balance itself out in time. Not now. I have been watching pandemic sensitive stocks closely since I learned about the possibility of a firebreak lockdown, following the recent increases in Covid-19 cases. So far, they have broadly reacted with a softening in share price. In fact, the FTSE 100 index has also been weak recently, indicating some overall bearishness.  If this lockdown actually happens, I will stay away from travel and travel-related stocks, considering the damage caused to them last year. They had only just begun to emerge from the worst of the pandemic, when the challenges began afresh. Since the virus is even more potent during the winter months, which will come around soon enough, I am now even more cautious about these stocks.  What’s going for it There is of course a possibility that the fast progress on vaccinations, booster jabs, and the cooling off in travel after the summer months can control further spread of the virus. And investor bullishness can return to the stock markets. If that happens, I think the future for Rolls-Royce could actually look good.  Since its positive results, it has also reported winning a government contract along with a consortium of organisations. Even more recently, it has entered into a contract with South Africa’s Airlink to service its aircrafts for the next 10 years. In sum, the company’s business appears to be progressing well. I am particularly heartened by signs of growth in its civil aviation segment, which was its biggest revenue generator before the pandemic.  My takeaway In a recent article on the company, I said that the Rolls-Royce share price will be impacted by three factors. One, overall market mood. Two, macro conditions. And three, its own news flow. So far, the third of these is going in its favour. The macro economy has not given any reasons for red flags either. That leaves us with the market’s mood, which I reckon will depend on how the coronavirus situation develops. Even earlier, I was waiting for more signs of genuine recovery in the company before buying the stock. So far, it has shown profits for only one quarter and that too because of a big tax credit. Additionally, there is a rise in pandemic risk once again. This tips the balance against the Rolls-Royce stock for me, at least for now. I will watch how the situation evolves before making a call. The post The Rolls-Royce share price has dropped. Would I buy it now? appeared first on The Motley Fool UK. One FTSE “Snowball Stock” With Runaway Revenues Looking for new share ideas? Grab this FREE report now. Inside, you discover one FTSE company with a runaway snowball of profits. From 2015-2019… Revenues increased 38.6%. Its net income went up 19.7 times! Since 2012, revenues from regular users have almost DOUBLED The opportunity here really is astounding. In fact, one of its own board members recently snapped up 25,000 shares using their own money… So why sit on the side lines a minute longer? You could have the full details on this company right now. Grab your free report – while it’s online. More reading 3 reasons why Rolls-Royce’s share price could soar! 3 of the best FTSE 100 index shares to buy right now Why I think the Rolls-Royce share price is a bargain Is the rising Rolls-Royce share price a buying opportunity? Why I prefer the Lloyds dividend to the Rolls-Royce share price Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  38. Rolls-Royce shares: 3 reasons why I’m optimistic for 2021 (17/03/2021 - The Motley Fool UK)
    Rolls-Royce (LSE:RR) shares have enjoyed a decent start to 2021. The share price is up around 15%, over a period when the FTSE 100 index is only up around 3%. This outperformance has coincided with the release of full-year results, the UK vaccination initiative gaining momentum, and other factors. Over a broader one-year period, the share price is still down over 50%, but I think there are several reasons to be more optimistic for 2021. Full-year results The first reason I’m optimistic for Rolls-Royce shares might sound strange. It’s actually relating to the full-year results that came out last week. The loss before tax was £2.9bn, an exceptionally large figure. Even though this figure was well-reported in the news, Rolls-Royce shares traded sideways on the release date.  Normally I’d expect a share price to plummet on such a bad figure, but it got me thinking. Rolls-Royce shares are already heavily down from 2020. Regular trading updates made investors aware of the bad situation within the company. So really, it was no surprise when the final figure came out. In effect, the share price didn’t fall because it was expected. So if I can discount the loss, what else was there to think about? Well the company cut £1bn in costs during the year. It raised £7.3bn in new capital, and expects to generate £2bn from selling off different assets. From that angle, 2021 looks positive.  A second reason I’d look to buy Rolls-Royce shares is the diversification of the business. For a while, I thought of the business only operating in the civil aviation space. Although this is the largest area, it’s not the only one. The results showed that good profits were made from its power systems and defense arms. In fact, the revenues generated from these two areas combined were larger than from civil aerospace. Going forward into 2021, if these areas can continue to grow, and civil aerospace recovers, Rolls-Royce shares could see a strong move higher. The business would be firing on all fronts, something it hasn’t been able to do in the recent past. Sentiment helping Rolls-Royce shares The final reason I like Rolls-Royce shares is the correlation between positivity and the rising share price. When I mean positivity, I’m talking about the sentiment regarding the pandemic. Here in the UK, the vaccination rollout is marching on. In the US, President Biden has also set out an ambitious timeframe to get people vaccinated. The more this continues, the quicker international travel and flying will start again. On balance, there are still reasons to be cautious with the stock. For example, the impact of the pandemic is likely to linger for some time. It’s not as though anyone can click their fingers and restore the billions lost in 2020 overnight. It’s going to be a slow road to recovery, and one that could weigh on Rolls-Royce shares for a while still to come. As a long-term investor, I can look past this. I would look to buy the stock, even with the knowledge that the recovery won’t be overnight. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading I’d buy Rolls-Royce shares despite the big 2020 loss Rolls-Royce share price: 2 reasons why I’d buy after earnings The Rolls-Royce share price is above 100p: what next? Rolls-Royce share price: I think we’ve seen the bottom I’m tempted by the Rolls-Royce share price. Here’s why I’m not buying jonathansmith1 has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce shares: 3 reasons why I’m optimistic for 2021 appeared first on The Motley Fool UK.
    [visit article]
  39. Rolls-Royce shares: should I buy? (22/02/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) shares have had a lot of attention lately, but the stock has been falling. So if it has taken a hit, is now a buying opportunity? I think so and I’d buy Rolls-Royce shares in my portfolio.  Civil Aerospace I can’t deny that Roll-Royce’s main business, the Civil Aerospace division has been severely hit by the coronavirus pandemic. I think what makes it worse is that revenue from this business accounts for over 50% of the company’s total earnings. But what does the Civil Aerospace division do? In a nutshell, it manufactures and services engines for the airline industry. So it’s no surprise that it has been hit by the pandemic. Global restrictions have meant little travel travel, thereby having a knock-on effect on the need for Rolls-Royce’s services. Now that there’s a mass vaccination programme under way, I expect air travel to start recovering slowly. I reckon there’s pent-up demand for people to holiday abroad. This in turn should start having a positive impact on Rolls-Royce shares. In its December trading update, Rolls-Royce reported that the Civil Aerospace business is gradually recovering. The number of large engine flying hours at the time was 42% of 2019’s level. While no one can predict the shape and timing of the recovery in air traffic, Rolls-Royce expects travel to pick up in the second half of 2021. By this time, I’d expect vaccines to have been rolled out a significant portion of the UK and global population Liquidity During the coronavirus crisis, Rolls-Royce improved its liquidity position. It raised money from a rights issue, and secured additional loans, as well as drawing on its existing cash reserves. Rolls-Royce took further measures by implementing cost-cutting measures and disposing of certain assets. To me, these steps have not only made the firm leaner but have also strengthened the balance sheet. According to its latest update, Rolls-Royce has access to £9bn in liquidity. It forecasts £2bn in cash outflow for 2021. For now, I reckon it can weather the storm and I’d buy the shares. Risks I think the biggest risk right now facing Rolls-Royce share is that no one knows how long this pandemic and restrictions will persist for. If this crisis drags on, this may place a strain on the business and liquidity reserves. Furthermore, if air travel doesn’t pick up in the second half of 2021 then Rolls-Royce may have to raise further capital. Another round of financing may not be well received by investors and could impact the share price. Defence business Clearly, I don’t think all is lost with Roll-Royce shares. I believe investors have become fixated on the company’s Civil Aerospace business and have forgotten that it has other divisions as well. In fact, I’d like to highlight its Defence business, which accounts for 20% of earnings. What I like about Rolls-Royce shares is that the defence business throughout the pandemic has been resilient. The company has defence contracts with the UK and US governments. It also has a strong order book and 2021 forecast sales are well covered. For now, I’m happy with the stable revenue visibility from this division.  “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading Rolls-Royce share price: how the company is preparing for the air taxi market The Rolls-Royce share price is back above 100p, but I wouldn’t buy the stock yet The Rolls-Royce share price is rising this week. Should I buy? The Rolls-Royce share price is under £1: should I buy today? What I think Covid-19 variants mean for the Rolls-Royce share price Nadia Yaqub has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce shares: should I buy? appeared first on The Motley Fool UK.
    [visit article]
  40. The Rolls-Royce share price is rising this week. Should I buy? (18/02/2021 - The Motley Fool UK)
    For years, I’ve liked Rolls-Royce (LSE: RR), but I’ve never got around to buying. Whenever the time came for me to make an investment, Rolls never quite made the top of my list. Maybe the Rolls-Royce share price looked a bit too high at the time. Or, more usually, there’s just something else I liked better. Warren Buffett famously spoke of investing in Gillette, and the warm feeling he got every morning when he thought of the millions around the world shaving with a new blade. I’ve always had similar feelings watching airline departures and arrivals. And thinking of all those lucrative maintenance contracts bringing in the cash for Rolls-Royce. But no comparison is perfect. Chins are still being shaved around the world during Covid lockdown. But the planes aren’t flying, and the Rolls-Royce share price has suffered. We’ve seen a modest climb this week though. Since market close last Friday, Rolls-Royce shares are up 8%, as I write. But I’d never make an investment decision based solely on short-term share price moves. And the bigger picture isn’t so pretty. Feeling bullish We’re close to a year on from the start of the Covid-19 stock market crash. And, in that year, the Rolls-Royce share price has fallen 58%. But it had been slipping even before that. Over the past two years, Rolls-Royce shares are down 70%. So we’re looking at a pandemic catastrophe on top of an existing downward trend. So why am I starting to feel positive towards the stock? Well, my reason is essentially that I still see the long-term business as sound. When Rolls-Royce will get back to profit, I really can’t guess. And I still expect the rest of 2021 to be rocky for the Rolls-Royce share price. Then there’s the huge amount of debt the company’s had to take on, amounting to around £4bn now. That will have to be addressed some day. But, for now, the key question is whether Rolls will make it through the rest of this crunch year. The firm’s latest update at the end of January essentially said things are in line with expectations. Rolls expects free cash outflow of around £2bn in 2021, and I could see a few eyes watering at the prospects of that. But at the end of 2020, the company had around £9bn in liquidity — which it described as “at the upper end of the previously guided range.” Rolls-Royce share price cheap? Rolls-Royce is hoping for an upturn in the aviation business in the second half of the year. And that’s where I think the big risk lies. The Covid vaccination programme is progressing reasonably well. But there almost seems to be a new virus variant every week. And the government is still urging against booking fly-away holidays just yet. Still, with the Rolls-Royce share price around £1, or less, I really am tempted to buy. But I still don’t know whether I will. Again, it’ll depend on what other options might look more promising when the time for my next purchase comes along. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading The Rolls-Royce share price is under £1: should I buy today? What I think Covid-19 variants mean for the Rolls-Royce share price Rolls-Royce share price: why I’d follow the Archer Aviation SPAC Rolls-Royce and Cineworld: are these UK shares too risky to buy now? The Rolls-Royce share price is down 66% this year. Here’s what I’d do now Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price is rising this week. Should I buy? appeared first on The Motley Fool UK.
    [visit article]
  41. What do the Rolls-Royce results mean for its share price? (05/08/2021 - The Motley Fool UK)
    Aeronautical engineer Rolls-Royce (LSE: RR) issued its interim results today. They cover the first half of the financial year. Why does that matter for the Rolls-Royce share price? In short, the City sees the Rolls-Royce results an up-to-date indicator of business health, with clues to how the business may perform in the future. Here I explain what that might mean for the share price. The big issue: free cash flow I previously flagged that the main thing I would be looking for in today’s Rolls-Royce results was any update on its expectation of turning free cash flow positive in the current half. That matters because liquidity concerns dogged the shares last year. Issuing new shares to boost liquidity was one reason Rolls-Royce shares fell last year, as it diluted existing shareholders. That is an ongoing risk with a capital intensive business such as Rolls-Royce. Being free cash flow positive matters because it means that there is more hard cash coming in the door than going out. That provides a stronger liquidity cushion for a company. In the results, Rolls-Royce again reiterated its target to turn free cash flow positive this half. It said explicitly, “We continue to expect to turn free cash flow positive sometime during the second half of this year”. Negative free cash flow in the past six months stood at £1.2bn, which is a sharp drop from last year. So the company expects negative cash flow to keep falling until it reverts to being positive. I think management credibility now depends on delivering this target as it has stated it so often. I think turning free cash flow positive could help boost the Rolls-Royce share price. Rolls-Royce results show a return to profit While cash flow is critical, the accounting concept of profit also matters in assessing a company’s prospects. In the half, Rolls-Royce recorded a profit of £393m, versus a huge loss of £5.4bn in the equivalent period last year. That equates to earnings per share of 4.7p. If that is maintained in the second half, it suggests that the company is currently trading at a prospective price-to-earnings ratio of around 11 or 12. That is fairly low so, following the Rolls-Royce results, I see upside potential for the shares. However, the valuation may reflect ongoing risks. For example, while aviation demand is returning, it is doing so in fits and starts. That means that the first half performance won’t necessarily be repeated in the following six months, for example if new travel restrictions are put in place. No dividend in the Rolls-Royce results The company did not announce any interim dividend. That is not surprising to me, as the company is still in a recovery phase. It makes sense to keep as much money as possible in the business while it rebuilds. Even if the company wanted to pay a dividend, it wouldn’t be allowed. A loan it drew down during the first half precludes it from paying any dividends until 2023. Rolls-Royce results summary There was much positive news in the results, including a recovery in revenues and profits. I think the repeated target of returning to free cash flow in the current half is significant. I expect the results to be well-received, which could help boost the Rolls-Royce share price. The post What do the Rolls-Royce results mean for its share price? appeared first on The Motley Fool UK. Our #1 North American Stock For The ‘New-Age Space Race’ Billionaires like Jeff Bezos, Bill Gates, Elon Musk, and Mark Zuckerberg are already betting big money on the ‘new-age space race’, and for one very good reason… …because this is an industry that according to Morgan Stanley could be worth $1 TRILLION by 2040. But the problem is most of their investments are in private companies — meaning they’re largely off-limits for everyday investors. Fortunately, our team of analysts have identified one little-known company that’s at the cutting-edge of the space industry, and is currently trading at what looks like a VERY reasonable valuation… …for now. That’s why I want to urge you to check out our premium research on this top North American space stock ASAP. Simply click here to see find out how you can grab your copy today More reading The recovery at Rolls-Royce is happening! Should I buy the shares now? Will this news help get the Rolls-Royce share price moving? The Rolls-Royce share price zooms past 100p. What’s next? Will the Rolls-Royce share price rise in August? Can the Rolls-Royce share price return to pre-pandemic levels? Christopher Ruane has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  42. The Rolls-Royce share price is under £1: should I buy today? (17/02/2021 - The Motley Fool UK)
    After hitting a high of 135p in early December, shares in aero engine maker Rolls-Royce Holdings (LSE: RR) have slumped due to the impact of renewed lockdown restrictions. Rolls-Royce’s share price has fallen by more than 25% since 3 December, to under 100p. On a 12-month view, Rolls shares have now fallen by nearly 60%. Ouch. Are Rolls-Royce shares a potential bargain? My colleague Graham Chester thinks they might be. I agree. But if I bought the shares today, I’d expect a rough ride before the company returns to reliable profitability. Here’s why. What’s the worst that could happen? I think it’s fair to say that many people underestimated the impact of the coronavirus pandemic. I think most businesses were unprepared too. They had not planned for a scenario where their revenue streams would be shut off by a health emergency and subsequent government action. I’m not here to discuss the politics of this situation. But the reality is that in 2021, Rolls-Royce expects to record engine flying hours that are 45% lower than in 2019. No business can be expected to shrug off such a big loss. Rolls expects to see a cash outflow of £2bn this year, despite cost-saving measures. Can things get worse? Rolls-Royce is banking on a recovery in flying hours during the second half of the year. But I don’t think we can be sure of this just yet. One risk I can see is that countries will return to normal this summer but might keep their borders closed for longer to protect against new virus variants. Why I think the stock could be cheap One challenge for Rolls-Royce is that it doesn’t make much money from selling its jet engines. Profits mostly come from after-sales servicing and support. In normal times, this business generates plenty of cash. This is the key to my belief that Rolls-Royce shares could be cheap at their current price. If I buy the stock, I’ll mentally write off 2021. Anything could happen and I expect the firm’s results to be awful. But from 2022 onwards, I believe the business should be operating pretty much as normal. At that point, I think the changes being made by CEO Warren East should start to deliver results. Rolls-Royce’s own forecasts suggest that it could generate surplus cash each year (known as free cash flow) of £750m “as early as 2022”. I reckon that hitting this target would make the business look cheap at current levels, with a price-to-free cash flow ratio of just 2.5. Rolls-Royce share price: my view I think Rolls-Royce’s valuation reflects a couple of risks for potential shareholders like me. The first is simply that the outlook is still very uncertain. A return to normal is not yet in sight. The second risk is probably more serious, in my view. Rolls-Royce has taken on around £4bn of new debt over the last year to help it survive the pandemic. At some point this borrowed cash will need to be repaid. However, even when I include the impact of Rolls’ increased borrowings, my sums tell me that at a share price of £1, Rolls-Royce could be a good addition to my long-term holdings. I’ve not decided whether to buy Rolls-Royce just yet. But this business is now on my watch list of shares to consider buying. One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading What I think Covid-19 variants mean for the Rolls-Royce share price Rolls-Royce share price: why I’d follow the Archer Aviation SPAC Rolls-Royce and Cineworld: are these UK shares too risky to buy now? The Rolls-Royce share price is down 66% this year. Here’s what I’d do now Rolls-Royce share price: could the company be a Tesla competitor in the future? Roland Head has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post The Rolls-Royce share price is under £1: should I buy today? appeared first on The Motley Fool UK.
    [visit article]
  43. Would I buy Rolls-Royce shares or International Consolidated Airlines Group shares? (03/06/2021 - The Motley Fool UK)
    That aviation is going through an awful time right now is an understatement. The upswing has started for most other segments of the economy, but we are still waiting for air travel to restart in earnest.  Not all aviation stocks are made equal There are better days ahead in store though, I feel. And some aviation stocks have already run-up significantly in anticipation of better times.  Low-cost airline Wizz Air, for instance, was recently at all-time-highs. RyanAir, another low-cost carrier, saw its share price rise to three-year highs. easyJet has also seen significant gains over the past year. Yet the speedy share price rise for these stocks combined with the expected slow healing of their financial health makes me doubtful if they can rise more in the near future.  But there are two stocks in aviation I see as having much potential. One is British Airways owner International Consolidated Airlines Group (LSE: IAG) and the other is aircraft engines’ provider Rolls-Royce (LSE: RR). They stand out for how little they have gained since last year’s market crash. IAG’s share price is actually lower than it was at the same time last year and the Rolls-Royce share price is almost at the same level. Rolls-Royce or IAG – which is the better buy? This could be a good opportunity to buy for me. But I do not want to expose myself a whole lot to aviation yet. So, I would like to buy shares of either IAG or Rolls-Royce, not both.  The question now is: which one of them is a better investment for me? Three ways to assess To assess this, I compared them across three parameters. One, their share price trends before the market crash. Two, their financial performances pre-pandemic. And three, their own outlooks for the rest of the year. In understanding their share price performances, I considered the five-year period between early 2015 and early 2020. Turns out that both their share prices have dropped over this time, albeit with much fluctuation during the interim.  In terms of financial performance, IAG is ahead of Rolls-Royce. IAG showed steady growth in revenue and was also profitable in the three years before the pandemic. Rolls-Royce too saw growth in revenue, but it was loss-making for two of the three years. And now it has had another bad year.  The outlook for both companies has improved, with some caution of course. But I think Rolls-Royce may be better placed even if aviation recovery is slow. Besides civil aerospace, power systems and defence systems are important sources of revenue for it. And it is optimistic about their recovery.  If, however, air travel restarts as planned, IAG can start recovering too. It does mention a “high level” of pent-up demand in its latest update.  My takeaway Based on this assessment, I lean towards IAG, largely because of its past performance. However, I will wait for another month to see how air travel picks up. That should indicate better which of the two is better placed. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading Cheap UK stocks: should I be buying airline shares ahead of the summer? Where will the Rolls-Royce share price go in June? What’s happening to the Rolls-Royce share price? Could the Rolls-Royce share price fall below 100p? Should I Invest in IAG shares right now? Manika Premsingh owns shares of easyJet. The Motley Fool UK has recommended Wizz Air Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Would I buy Rolls-Royce shares or International Consolidated Airlines Group shares? appeared first on The Motley Fool UK.
    [visit article]
  44. This is what I’m doing about the Rolls-Royce share price! (17/05/2021 - The Motley Fool UK)
    I suppose I could describe the performance on major stock markets last week as a bit of a washout. The FTSE 100, for instance, dropped 1% between Monday’s opening and Friday’s close as investors fretted about rocketing inflation and the prospect of extreme monetary tightening by central banks. However, the Rolls-Royce (LSE RR) share price held up quite robustly, despite these rising concerns. In fact, the FTSE 100 engine builder rose 1% during the course of the week. Consequently Rolls-Royce remains a chunky 15% more expensive than it was 12 months ago. Can the Rolls-Royce share price keep rising? There are several reasons why I think the Rolls-Royce share price could continue its ascent. #1: The Covid-19 battle keeps progressing. 2020 might have been a disaster for the aviation industry and by extension the FTSE 100 engineer. But latest financials last week suggest that the company may have turned the corner. Rolls-Royce has noted that large engine flying hours have remained stable since the end of last year. It’s also said that Covid-19 vaccination programmes in a significant number of countries were “encouraging” for its operations. #2: Defence spending continues to rise. One of the few bright spots for Rolls-Royce last year came from its Defence division. Sales at this unit — responsible for 30% at group level — edged 4% higher in 2020. I fully expect demand from its military customers to keep rising too as broader global arms spending heads relentlessly higher. Flies in the ointment There are clearly reasons why the Rolls-Royce share price could keep gaining ground. But the risks of it falling back to earth are not insignificant. In particular, any setbacks in the fight against Covid-19 could prove problematic if they delay a recovery in the global travel industry. The ongoing emergence of fresh virus variants (the Indian edition in particular is causing infection rates to accelerate in some parts of the globe) is a special concern for the industry. A fresh blow-up is particularly risky for firms with weak balance sheets like Rolls-Royce, naturally. Net debt at the company swelled to £3.6bn as of the end of 2020 from below £1bn a year earlier. And measures to get its pile down through asset disposals haven’t been off to a flyer either. A deal to hive off its Bergen maritime division was shot down on security concerns earlier this month. The verdict City analysts think losses at Rolls-Royce will narrow from 66.78p per share in 2020 to 2.3p this year. Expectations of further recovery in the airline industry mean the company’s expected to flip back into earnings of 3.6p per share in 2022 as well. These cheery predictions aren’t enough to tempt me to invest, however. The Covid-19 crisis could explode again at any moment, wrecking a bottom-line recovery at Rolls-Royce and putting fresh stress on its debt-laden balance sheet. Besides, I don’t think the Rolls-Royce share price provides particularly-good value right now (it trades on a forward earnings multiple of 30 times). I’d rather buy other UK shares today. There’s a ‘double agent’ hiding in the FTSE… we recommend you buy it! Don’t miss our special stock presentation. It contains details of a UK-listed company our Motley Fool UK analysts are extremely enthusiastic about. They think it’s offering an incredible opportunity to grow your wealth over the long term – at its current price – regardless of what happens in the wider market. That’s why they’re referring to it as the FTSE’s ‘double agent’. Because they believe it’s working both with the market… And against it. To find out why we think you should add it to your portfolio today… Click here to get access to our presentation, and learn how to get the name of this 'double agent'! More reading As the Rolls-Royce share price remains cheap, I’d invest £3k Is it time to act on the Rolls-Royce share price? Can the Rolls-Royce share price stay above 100p? The Rolls-Royce share price has been ticking upwards. Is it time to buy now? The Rolls-Royce share price has fallen. Is now the time to buy? Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post This is what I’m doing about the Rolls-Royce share price! appeared first on The Motley Fool UK.
    [visit article]
  45. How much is the Rolls-Royce share price really worth? (08/05/2021 - The Motley Fool UK)
    The Rolls-Royce (LSE: RR) share price has jumped about a fair bit over the past 24 months. In May 2019, the stock was changing hands for just over 300p. However, it steadily declined throughout the rest of the year. By the beginning of 2020, the price of a share in Rolls had fallen to 232p.  Then the coronavirus pandemic began. Rolls was disproportionately affected as the crisis brought the global aviation industry to its knees. The stock plunged below 100p in April 2020 and fell to a low of 39p in October.  Since then, investor sentiment has steadily recovered. The Rolls-Royce share price returned to 130p in December 2020 as it looked as if the world was beginning to move on from the pandemic. Then the second wave struck. While the stock never returned to the low of October 2020, it dropped significantly, falling around 40% from the beginning of December to the end of January 2021.  Trying to value the Rolls-Royce share price  I think this volatility shows just how hard it has been for the market to understand how much Rolls is worth right now. The company is battling numerous headwinds, and its outlook is far from clear. So trying to value the business at this point is incredibly difficult.  That being said, while past performance should never be used as a guide to future potential, we can look at the company’s historical revenues and profits to try and estimate how much the stock could be worth in the best-case scenario. In 2019, the group’s revenues totalled £16.6bn. Throughout much of that year, the company’s market capitalisation was around £18bn. That suggests a market capitalisation-to-sales ratio of 1.1.  This gives me some guidance as to how much the Rolls-Royce share price could be worth. If revenues return to 2019 levels, the company’s market value could rise back to £18bn. Today it is £8.8bn.  Rough valuation  Of course, this is only a rough, back-of-the-envelope projection. I’ve used sales figures because the company has lost money in four of the past six years. This makes it very difficult for me to place a value on the business based on profitability alone. It also reduces the chances that the stock will ever return to previous highs. As long as Rolls continues to lose money, I think investor sentiment towards the business will remain week. There’s always going to be a question as to whether or not the company will be able to sustain its losses.  Still, management has stated that the enterprise is aiming to become free cash flow positive next year. If the company can hit this target, it will remove some of the pressure from its balance sheet. However, I should note that the group has missed management growth projections in the past. That’s something investors should keep in mind.  Overall, it isn’t easy today for me to say how much the Rolls-Royce share price is worth. Nevertheless, I would buy a small amount of the stock for my portfolio today as a recovery play.  CEO’s £500,000,000 Stake on Industry’s “Uber” Revolution We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign. But with this opportunity it could get even better. Still only 55 years old, he sees the chance for a new “Uber-style” technology. And this is not a tiny tech startup full of empty promises. This extraordinary company is already one of the largest in its industry. Last year, revenues hit a whopping £1.132 billion. The board recently announced a 10% dividend hike. And it has been a superb Motley Fool income pick for 9 years running! But even so, we believe there could still be huge upside ahead. Clearly, this company’s founder and CEO agrees. Learn how you can grab this ‘Top Income Stock’ Report now More reading Will the Rolls-Royce share price fly this summer holiday season? Can the Rolls-Royce share price bounce back? Will the Rolls-Royce share price soar in May? FTSE 100 shares: 3 I’m considering for my ISA The Rolls-Royce share price is falling: should I buy now? Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post How much is the Rolls-Royce share price really worth? appeared first on The Motley Fool UK.
    [visit article]
  46. As the Rolls-Royce share price falls, I’m still buying (24/04/2021 - The Motley Fool UK)
    Since hitting a post-Covid-crash high of 135p in December of last year, the Roll-Royce (LSE: RR) share price has been under pressure. The stock has fallen around 25% since it reached this level. The sell-off accelerated last week, with the stock falling around 6%. Over the past 12 months as a whole, the Rolls-Royce share price has fallen 8%. It’s down 56% over the past five years.  However, I think the recent declines in the share price could be an opportunity for long-term investors.  Overcoming challenges  I think the market has got it wrong here. Shares in the aerospace business have been falling in 2021, but the group’s outlook is only improving. Compared to this time last year, Rolls’ outlook is entirely different. The company seems to have pulled through the worst of the crisis, the airline industry is back in the air, and the group has shored up its balance sheet.  Granted, the business still faces some severe headwinds. Its latest trading updated predicted a free cash outflow in the “region of £2bn in 2021.” That’s money flooding out of the business management will have to find from somewhere. The group highlighted its £9bn of liquidity in the same update, which should help it cover the cash outflow. If there’s another more severe coronavirus wave, Rolls will face more losses. It’s unclear if the business could weather another two years of billions of pounds of cash losses. Rolls-Royce share price opportunity  These are the main risks and challenges facing the Rolls-Royce share price. But the company’s long-term potential is encouraging. The corporation believes it can generate £750m of free cash flow by 2022. This projection is “based on 2021 widebody engine flying hours at around 55% of 2019 levels.”  A positive free cash flow would put the business back on a sustainable footing and remove the need for further cash calls.  How likely is it Rolls will meet this target? I think there’s a 50/50 chance. On the one hand, the pandemic is still raging in Asia, and it seems unlikely this will change anytime soon. On the other, over in the US, the aviation business is booming. Some airlines are even hiring new pilots.  As such, it seems to me that the Rolls-Royce share price is a high-risk investment. Yes, the stock has potential, but many risks on the horizon could cause turbulence for the firm.  Nevertheless, it seems clear to me the stock isn’t reflecting the company’s improving fundamentals. As long as there’s no Covid resurgence and the aviation industry continues to recover, I think Rolls’ fundamentals will continue to improve. Therefore, I’d buy the stock for my portfolio today as a recovery play. Although I’d keep the risks surrounding the Rolls-Royce share price in mind and re-evaluate my position if things change.  One stock for a post-Covid world… Covid-19 is ripping the investment world in two… Some companies have seen exploding cash-flows, soaring valuations and record results… …Others are scrimping and suffering. Entire industries look to be going extinct. Such world-changing events may only happen once in a lifetime. And it seems there’s no middle ground. Financially, you’ll want to learn how to get positioned on the winning side. That’s why our expert analysts have put together this special report. If the pandemic has completely changed our lives forever, then they believe that this stock, hidden inside the tech-heavy NASDAQ, could be set for monstrous gains… Click here to claim your copy now — and we’ll tell you the name of this US stock… free of charge! More reading Will the Rolls-Royce share price recover in the second half of 2021? Why I think I could double my money with the 100p Rolls-Royce share price The Rolls-Royce share price is crashing in April! Should I buy RR today? Does the Rolls-Royce share price make me want to buy in 2021? 2 ways the Rolls-Royce share price could benefit from the reopening economy Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post As the Rolls-Royce share price falls, I’m still buying appeared first on The Motley Fool UK.
    [visit article]
  47. Would I buy Rolls-Royce shares at 8-month lows? (21/07/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) shares hit a low on Monday, crashing below 90p to eight-month lows. They recovered a bit by yesterday’s close, but not significantly so. When it was last at these levels, the Rolls-Royce share price was actually on its way up. This was in November last year and the stock market rally had just begun. Now is the exact opposite situation. It has been falling for much of the past month.  Better times ahead At any other time, I would have not thought of buying Rolls-Royce shares at such a juncture. But this time things are different. We have finally passed Freedom Day in the UK, which makes any Covid precautions discretionary (for now). Also, in the UK, North America and much of Europe, at least 50% of the population has had at least one vaccine shot. This means that we are closer to travelling in big numbers again than we have been at any time in the last year.  Considering that 60% of the company’s revenues come from the supply and servicing of civilian aircraft, this is good news indeed. This segment has been a big drag in the recent past, even while its power systems and defence segments have been in better health.  Disposals programme gathers pace I reckon that it will still be some time before Rolls-Royce can get its financials in order. But I think the worst may be over for it. Besides an improved outlook, this is because of its notable commitment to its £2bn disposals programme. It initiated this last year in a bid to get back to financial health after the pandemic.  In December, it decided to sell off its nuclear instrumentation business to French civil nuclear energy company Framatome. It is also trying to sell its Spanish aircraft engine business, ITP Aero and Bergen Engines, its maritime engine maker.  Most recently, media reports have said it plans to sell its stake in AirTanker, which leases aircraft to the RAF. Rolls-Royce has a roughly 50% stake in the company, while much of the rest is owned by Babcock International, the defence and nuclear engineering business.  What’s next for the Rolls-Royce share price? I think these are positive developments but we should have a better idea of how things are progressing only by the end of the year. This is because, by then, more data on the recovery should be available.  But the Rolls-Royce share price can start rising before that. The rise in new coronavirus cases that caused a mini market meltdown a few days ago now seems to be behind us. And prices of sensitive stocks are moving up. This includes Rolls-Royce, which is up by 6.3% in today’s trading.  Also, stock markets have a tendency to preempt the future. So by the time its updates reflect better health, I reckon that will already be priced in, assuming that the markets remain buoyant.  I am still cautious though, because it was not in a great place even before the pandemic. And any setbacks in reopening global travel could hit it hard. But going by improving conditions at the moment, it is on my watchlist for now. The post Would I buy Rolls-Royce shares at 8-month lows? appeared first on The Motley Fool UK. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner. But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared. What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations. And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! More reading The Rolls Royce share price is below 100p – so is it a buy? Can the Rolls-Royce share price recover in 2021? 3 FTSE 100 shares to buy after the ‘Freedom Day’ crash Will the Rolls-Royce share price keep falling? How low can the Rolls-Royce share price go? Manika Premsingh has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]
  48. Rolls-Royce share price: what I’d do given the upcoming full-year result (25/02/2021 - The Motley Fool UK)
    Although shares are still down by around half over the last 12 months, Rolls-Royce (LSE:RR) shares have rallied recently. As of 24 February, the Rolls-Royce share price is up over 9% over the last week and 14% over the last month. Given that the aerospace engine maker reports its 2020 full-year results on 11 March, the Rolls-Royce share price could have further moves ahead of it. If the results and guidance are better than expected, shares could go higher. If they don’t meet expectations, shares could decline. With the upcoming full-year result, here’s what I’d do. The upcoming full-year result In terms of Rolls-Royce’s upcoming full-year result, I’ll look for several things. First, I’d look to see if management updates widebody engine flying hours guidance. Civil aviation is a big part of the company’s business and weakness in the area is one reason why management forecasted a free cash flow outflow of around £2bn in 2021. That amount of expected free cash outflow didn’t meet many analyst estimates. If guidance for wide-body engine flying hours is stronger than expected during the full-year result, however, I reckon the Rolls-Royce share price could rise. Second, I’ll look to see if management updated cash flow guidance. Specifically, I want to see if management is more confident on their free cash flow target for next year. As of late January, management seemed to be hedging somewhat on their target, as they said their goal is “to deliver at least £750 million of free cash flow (excluding disposals) as early as 2022, contingent on the expected recovery in engine flying hours”. If management doesn’t say the contingent part in the full year result report, I’ll be more optimistic on the stock. I’ll also look for any hints of how the ITP Aero sale process is going. If management gets a higher than expected price for ITP Aero, I reckon there is a chance that the market could value Rolls-Royce’s other assets higher too. If that occurs, I think it could help the Rolls-Royce share price. Lastly, I’m been keen to see if management gives any updates on their green strategy. For various reasons whether deserved or not, the market is currently pretty optimistic on many green stocks. If that optimism continues and Rolls-Royce successfully sells itself as more of a green stock itself, I reckon there’s potential for higher stock prices. The Rolls-Royce share price: what I’d do I’d buy and hold shares given the current Rolls-Royce share price. Although it might take longer than expected due to the spread of Covid-19 variants, I nevertheless think a recovery in civil aviation will happen. Companies like GlaxoSmithKline are working on potential vaccine candidates for variants that might be ready as soon as next year and the number of existing new cases is falling in many areas of the world. Longer term, I think Rolls-Royce has potential to add a lot of value by servicing propulsion systems for the electric air taxi market. With this said, Rolls-Royce shares could decline if its full-year results don’t meet expectations. If the time to civil aviation recovery lasts longer than expected or if management makes bad capital allocation decisions, the stock might not do well. The high-calibre small-cap stock flying under the City’s radar Adventurous investors like you won’t want to miss out on what could be a truly astonishing opportunity… You see, over the past three years, this AIM-listed company has been quietly powering ahead… rewarding its shareholders with generous share price growth thanks to a carefully orchestrated ‘buy and build’ strategy. And with a first-class management team at the helm, a proven, well-executed business model, plus market-leading positions in high-margin, niche products… our analysts believe there’s still plenty more potential growth in the pipeline. Here’s your chance to discover exactly what has got our Motley Fool UK investment team all hot-under-the-collar about this tiny £350+ million enterprise… inside a specially prepared free investment report. But here’s the really exciting part… right now, we believe many UK investors have quite simply never heard of this company before! Click here to claim your copy of this special investment report — and we’ll tell you the name of this Top Small-Cap Stock… free of charge! More reading Rolls-Royce shares: is it the right time to buy? The Rolls-Royce share price: have we seen the bottom? Rolls-Royce share price is around 100p. Here’s what I’d do Rolls-Royce shares: should I buy? Rolls-Royce share price: how the company is preparing for the air taxi market Jay Yao has no position in any of the shares mentioned. The Motley Fool UK has recommended GlaxoSmithKline. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. The post Rolls-Royce share price: what I’d do given the upcoming full-year result appeared first on The Motley Fool UK.
    [visit article]
  49. Why is the Rolls-Royce share price having such an uncertain June? (21/06/2021 - The Motley Fool UK)
    Rolls-Royce (LSE: RR) is one of the few FTSE 100 stocks that, as my Motley Fool colleague Rupert Hargreaves pointed out, has essentially gone nowhere over the past 12 months. It’s pretty much flat since the start of 2021 too. But looking a little closer, we can see the the Rolls-Royce share price has actually been through a lot of short-term ups and downs. Looking at June alone, Rolls shares have lurched between a high of 113.5p and a low of 104p. That’s a swing of 9% from lowest to highest, and way more volatile than the Footsie. Similarly sized ups and downs have been going on for months. It’s as if investors keep wanting to get in, keep thinking maybe the time is ripe for the recovery to start… and then it doesn’t take off and fades again, until the next time. I know it’s dangerous to read too much into short-term share price volatility. And I would never make an investing decision based on what the Rolls-Royce share price has done over the past few months or so. But if my speculations on investor sentiment are anywhere near the truth, they’re really just reflecting my own thoughts. I like the company The thing is, I’ve liked Rolls-Royce for a long time. And it’s one company that I’d really like to buy a chunk of at a cheap price. The company had hit a tough patch even before the pandemic brought a near halt to aviation. I reckon that presented a good buy at the time for investors with a long-term horizon. But it’s history now. I really do think the Rolls-Royce share price will recover from its current hammering. The only thing I just can’t get my head round is how long it might take for a sustainable profits recovery to set in. Oh, two things — and whether Rolls has the liquidity needed to see it through to such times. If it hasn’t, we might see further falls. In the past month, I can’t help feeling the delayed lifting of the UK’s final Covid-19 restrictions has made investors a bit twitchy again. Right now, Boris Johnson has said it’s “looking good” for the new target date of 19 July to be met. But, well, he’s said a lot of things over the years. Rolls-Royce share price uprating? So what are my thoughts now about the next stage for Rolls as an investment? To turn my own sentiment sufficiently bullish, I think I’ll need to see a positive set of results. In particular, I want to see how the balance sheet and cashflow situation are looking. Once we see clearer developments on those fronts, if we see them, I can see the Rolls-Royce share price enjoying an uprating. When might that come? First-half results should be with us on 5 August, and that’s really not very long now. By then, we should have firmer news on the pandemic front. And, hopefully, a bit of confidence returning to the aviation business. I’ll be waiting at least that long before I finally decide, and possibly a good bit longer. I think there’s probably a 50/50 chance that I’ll end up buying Rolls-Royce shares one day. The post Why is the Rolls-Royce share price having such an uncertain June? appeared first on The Motley Fool UK. One FTSE “Snowball Stock” With Runaway Revenues Looking for new share ideas? Grab this FREE report now. Inside, you discover one FTSE company with a runaway snowball of profits. From 2015-2019… Revenues increased 38.6%. Its net income went up 19.7 times! Since 2012, revenues from regular users have almost DOUBLED The opportunity here really is astounding. In fact, one of its own board members recently snapped up 25,000 shares using their own money… So why sit on the side lines a minute longer? You could have the full details on this company right now. Grab your free report – while it’s online. More reading What’s going on with the Rolls-Royce share price? Should I buy Tirupati Graphite shares? Will the Rolls-Royce share price ever get back to 200p? Would I buy Rolls-Royce shares or International Consolidated Airlines Group shares? Where will the Rolls-Royce share price go in June? Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
    [visit article]

For more information mailto [email protected]. Disclaimer.