RCL Shares

Intr3pid

Mouseketeer
Joined
Mar 2, 2018
Didn't pull the trigger last week and it looks like the sub $25 threshold has happened. Now, I am thinking that $15 is realistic even with the government aid.
If you need your money back in a few months, there is no safe price. You might as well buy a ticket on the Titanic.

If you believe in a demand turnaround next year onwards - a strong possibility - buy at a price you can afford. In the long run, waiting for that perfect timing has led many to miss the boat entirely - no pun.
 

hertamaniac

WDW Local
Joined
Feb 9, 2017
If you need your money back in a few months, there is no safe price. You might as well buy a ticket on the Titanic.

If you believe in a demand turnaround next year onwards - a strong possibility - buy at a price you can afford. In the long run, waiting for that perfect timing has led many to miss the boat entirely - no pun.
I have no urgent timetable for any of my equity investments. Therefore, I decided to purchase into the tourism/travel industry this week. My investment horizon is long and I usually have a set % of return before selling.
 

stagmite

Earning My Ears
Joined
Mar 18, 2020
Wow their stock keeps getting hammered. I thought last week it was a good buy in the $30 range, but now it's dipped below $25. I am definitely going to be buying soon because I think they will eventually recover, and in the meantime I get $50 of onboard credit for every 100 shares I own. Sounds like a win to me even if I don't time the market right.
 
  • Starport Seven-Five

    Mouseketeer
    Joined
    Aug 16, 2019
    I have been watching it but haven't had a chance to dig into their financials. Any one look at how much they owe vs cash on hand? Or any comparisons with other cruise lines?

    My biggest concern is that the cruise line in the worst financial shape may be allowed to fail (a la 2009) and I don't want to be holding shares of that cruise line.
     

    stagmite

    Earning My Ears
    Joined
    Mar 18, 2020
    Yes and it's not good. They owe way more then they have cash on hand so I can see why people are selling it like crazy. They either need to start selling their assets or wait for a government hand out. I'm assuming the government will come in and save them at some point, just like they would have to do the same for the airlines.
     

    Intr3pid

    Mouseketeer
    Joined
    Mar 2, 2018
    Yes and it's not good. They owe way more then they have cash on hand so I can see why people are selling it like crazy. They either need to start selling their assets or wait for a government hand out. I'm assuming the government will come in and save them at some point, just like they would have to do the same for the airlines.
    Most of their debt is long-term.

    The existing liquidity situation isn't pretty, but it looks like the analysts cheered Carnival's earnings report today. They were expecting much worse. Of course, full effects won't be seen until the next quarter is out.
     

    stagmite

    Earning My Ears
    Joined
    Mar 18, 2020
    They still have quite a bit of short term debt that still far exceeds their cash on hand. They won't go bankrupt or anything because they have plenty of assets, but they will continue to bleed money until this coronavirus thing blows over.
     
  • hertamaniac

    WDW Local
    Joined
    Feb 9, 2017
    Looks like they've secured $2.2B in credit. Stock got a boost even with the bloodshed today. I think we'll see a dividend cut/reduction shortly.
     

    Intr3pid

    Mouseketeer
    Joined
    Mar 2, 2018
    Yes, they do have a lot more untapped liquidity. Cash at hand is just what they have drawn on it so far.

    The $2.2bn loan has a one-year term but can be renewed for one additional year. Cost is LIBOR plus ~2.5%, which translates to 3.5% to 4.0% total interest cost with fees at the moment. LIBOR will likely go down from here, and so will the total interest cost.

    Hard to believe, but the big 30%-40% spikes today in RCL and NCLH have put this investment in black for me.
     

    hertamaniac

    WDW Local
    Joined
    Feb 9, 2017
    I win some and lose some. In RCL's case, I pulled the trigger last week and cashed out yesterday when my ROI >70%. I will watch for an announcement for dividend cuts/reduction in the coming weeks and then repeat the process.
     
  • Intr3pid

    Mouseketeer
    Joined
    Mar 2, 2018
    While the cruises may all be on hold, it looks like their share prices have sailed!

    This was a rare window. Bought enough shares in all three - first, for price gains roughly equivalent to a free cruise in each (lol) - and now from here, the shareholder benefit. No idea when I'll be able to use them though (and probably won't in the case of Carnival anyways).

    I think this is a classic example of investing in what you know best.
     

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