UK stock report - Rolls-Royce Holdings

UK

Rolls-Royce underperforms 87% of the market August 18, 2017 16:30 BST

NEWS BITES - EUROPE

Rolls-Royce Holdings PLC (L:RR.), the 2nd largest Aerospace & defense company by market cap in the United Kingdom, has decreased GBX10.50 (1.2%) from its last trading session of August 17 to close at GBX901.0. Compared with the FTSE 100 Index which fell 63.9 points (0.9%) in the day, the relative price change was -0.3%. The volume was 0.5 times the average daily trading volume of 6.1 million shares. In the United Kingdom market of 1,330 stocks and 134 units traded today, the stock has a 14-day relative price strength of 13 indicating it has underperformed 87% of the market. A price fall combined with a low relative strength is a bearish signal.

SECTION 1

ROLLS-ROYCE BEARISH SIGNALS

1.1 Fundamentals:

+ The relative yield of the stock, defined by its yield of 1.3%, divided by average yield of dividend yielding stocks in the FTSE 100 Index of 4.0% is 32.8%. This suggests the stock is overvalued in dividend yield terms.

+ Total Liabilities/EBITDA of 172.8 which compares unfavourably with the Joseph Piotroski benchmark of 5.

1.2 Overvaluation [compared with sector average]:

+ Return on Capital Employed 0.9% [5.8%].

+ Dividend yield of 1.3% [2.3%].

1.3 Technicals:

+ The price decreased 1.0% in the last week and 1.6% in the last month.

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 919.09 minus the 26-day EMA of 922.07 is negative 2.98 suggesting a bearish signal. Both EMA prices are falling, another bearish signal.

+ The stock's relative price strength percentile is falling at 87 for 6 months, 71 for 3 months and 36 for 1 month.

1.4 Low Performance Indicators:

DescriptionValueRank In Market
Price Change %-1.2In Bottom Quartile
Return on Capital Employed [ROCE] %0.9In Bottom 3%
EBITDA Margin %0.9In Bottom 1%
Total Debt to Equity4.9In Bottom 1%

SECTION 2

ROLLS-ROYCE BULLISH SIGNALS

2.1 Fundamentals:

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.6. Compared with the rest of the market the stock is undervalued.

+ The company is cash rich with Cash to Market Capitalisation at 16.7%.

2.2 Technicals:

+ In the last three months the stock has hit a new 52-week high eleven times, pointing to a significant uptrend.

+ The present value of GBP1,000 (PV1000) invested one year ago in Rolls-Royce is GBP1,176, comprising a capital gain of GBP159 and dividend reinvested of GBP17.

PV10001-week1-month1-year
RR.L9909841,176
FTSE 100 Index1,0029841,066

+ The present value of GBP1,000 (PV1000) invested five years ago in Rolls-Royce is GBP1,287, including a capital gain of GBP155 and dividend reinvested of GBP132.

+ 5 years Multiplier in GBP = 1.287x

+ Compound Annual Growth Rate (CAGR) in GBP = 5.2%

Present Value of USD1,000 invested 5 years ago:

+ The present value of USD1,000 (PV1000) invested five years ago in Rolls-Royce is $US1,056, including a capital loss of $US52 and dividend reinvested of $US108.

+ 5 years ago GBP 1 equalled USD 1.57

+ 5 years Multiplier in USD = 1.056x

+ Compound Annual Growth Rate (CAGR) in USD = 1.1%

Aug 18, 2017: GBP 1 equals USD 1.29

2.3 Oversold/Bullish/Support Signals:

+ The stock is oversold according to the Williams % R indicator of -94.9, suggesting the price is close to its 14-day low of GBX896.0.

2.4 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverGBP29.7 million (US$38.3 million)In Top 3%
Price/MAP2001.12In Top Quartile
Cash to MCap %16.7In Top Quartile

SECTION 3

PRICE VOLUME DYNAMICS

3.1 Volatility:

+ Rolls-Royce is at a discount of 9.4% to its 12-month high of GBX994.50 on August 01. It is also at a premium of 43.1% to the 12-month low of GBX629.54 on January 05.

3.2 Moving Annual Return

RR.Close (GBX)Dividends (GBX)Capital Gain / (Loss) %% YieldAnnual Return %
August 1890111.715.91.517.4
1 Yr ago777.5216.371.52.13.6
2 Yrs ago766.0723.1(22.1)2.3(19.7)
3 Yrs ago983.2522(4.7)2.1(2.5)
4 Yrs ago1,031.5119.532.22.534.7

3.3 Beta:

+ Beta: the Beta of Rolls-Royce stock is 0.6. A Beta lower than 1 suggests this is a low risk, low return stock with volatility less than that of the market.

3.4 Aggregate Volumes, Prices and Turnover Period:

[Volume Index or VI in brackets; 1 is average]

+ London: RR.L 3,301,784 [VI of 0.5] volume 99.68% of aggregate. Price: GBX901.0.

+ OTC Pink: RYCEF.PINKSHEETS 9,494 [VI of 0.5] volume 0.29% of aggregate. Price: $US11.64. Using the current exchange rate of USD1 equals 77.6GBX, The shares are at a 0.3% premium to the close price on London.

+ Aggregate volume: there were 3.3 million shares of Rolls-Royce worth GBP29.8 million traded today. The aggregate volume was 0.5 times average trading of 6.1 million shares.

The turnover rate in the 12 months to date was 69.8% (or a turnover period of 1 year 5 months). This average length of ownership of the stock at 47.7 times the average holding period of 11 days for stocks in the FTSE 100 Index suggests a larger number of core investors, making a long-term investment safer.

SECTION 4

RANKING

4.1 Global Rank [out of 47,594 stocks] and Rank in the Europe Region [out of 8,387 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap (US$)21.4B669175
Total Assets (US$)32.9B1,170278
Revenue (US$)19.3B714186
Net Profit (US$)(5.2B)41,8966,984
Net Profit Margin %(27.0)33,0215,621
Yield %1.315,0172,742
PV$1000 (1Year) US$*1,16415,2383,237
US$* Change (1Year) %16.815,1883,226

* 1 year ago GBP 1 = USD 1.3

Aug 18, 2017: GBP 1 equals USD 1.29

4.2 Independent Ratings

Rolls-Royce Holdings PLC was ranked 193 in the Industry Week list of the world's largest 1000 manufacturers by Revenues in 2015; a deterioration over a year from rank 172 in 2014.

It is the 203rd largest by revenue in the FT Global 500.

It is the 418th largest by revenue in the Forbes Global 2000.

It is placed 586/1238 in BSS News Bites' ranking of United Kingdom performers in the past year, a percentile ranking of 53.

SECTION 5

ROLLS-ROYCE FINANCIALS

5.1 Financials Summary

Year endedDec 2016Dec 2015Dec 2014
Sales (USD B)19.417.818.1
Pretax (USD)(6B)207.8M87M
Net (USD)(5.2B)109.1M89.6M
EPS (GBP)(2.2)0.040.04

5.2 Trailing 12 Months Dividends

Trailing 12 Months ToValue (GBX)
18 Aug 201711.7
18 Aug 201616.37
18 Aug 201523.1
18 Aug 201422
18 Aug 201319.5

SECTION 6

ROLLS-ROYCE PROFILE

6.1 Activities

Rolls-Royce Group plc is an integrated power systems company, operating in civil and defense aerospace, marine and energy markets. The Company serves customers in over 120 countries. Its gas turbine products are shipped to customers worldwide, by land, sea and air. It is a global provider of defense aero-engine products and services, with 18,000 engines in service for 160 customers in 103 countries. Its marine business has more than 2,000 customers and equipment installed on over 30,000 vessels worldwide, including those of 70 navies. The Company's energy business is a supplier of power systems for onshore and offshore oil and gas applications. The Company operates in four segments: Civil aerospace, Defense aerospace, Marine and Energy. During the year ended December 31, 2009, the Company acquired 58% interest in Tidal Generation Limited, 49% interest in Europea Microfusioni Aerospaziali S.p.A. and 33% interest in ODIM ASA.

6.2 Industry & Sector

Classification LevelName of Sector
Business SectorIndustrial Goods
Industry GroupAerospace & Defense
IndustryAerospace & Defense
Economic SectorIndustrials

6.3 Issued Capital

Based on 1,840,579,426 issued shares the market capitalisation is GBP16.6 billion (US$21.4 billion).

SECTION 7

REPORTED BUYING AND SELLING

Insider Buying

August 08: Rolls-Royce director buys

Rolls-Royce (L:RR.) director Simon Kirby bought 15 shares worth GBP145 ($US188) on August 07. The purchase price was GBP9.67. The shares hit a five-day high on the day.

August 08: Rolls-Royce director buys

Rolls-Royce (L:RR.) director Eric Schulz bought 16 shares worth GBP155 ($US201) on August 07. The purchase price was GBP9.67. The shares hit a five-day high on the day.

August 07: Rolls-Royce director buys

Rolls-Royce (L:RR.) director Kevin Smith bought 274 shares worth GBP2,647 ($US3,446) on August 07. The purchase price was GBP9.66. The shares hit a five-day high on the day.

August 07: Rolls-Royce director buys

Rolls-Royce (L:RR.) director Ruth Cairnie bought 201 shares worth GBP1,942 ($US2,528) on August 07. The purchase price was GBP9.66. The shares hit a five-day high on the day.

August 07: Rolls-Royce director buys

Rolls-Royce (L:RR.) director Frank Chapman bought 410 shares worth GBP3,961 ($US5,156) on August 07. The purchase price was GBP9.66. The shares hit a five-day high on the day.

SECTION 8

STOCK BUZZ

8.1 Latest Buzz

News DateHeadlinePublisher
Aug 17, 2017Rolls-Royce Holdings PLC (RR.L) Holds Steady Above Rising TrendlineBVN
Aug 17, 2017Rolls-Royce Holdings PLC (RR.L) Technicals Are Speaking Volumes; Where is This..Clayton News
Aug 17, 2017Shares Seesawing on Volume: Rolls-Royce Holdings PLC (RYCEY)Concord Register
Aug 17, 2017Streetwise Analysis on Shares of Rolls-Royce Holdings PLC (RYCEY)Financial Newsweek
Aug 17, 2017Following the Needle on Rolls-Royce Holdings PLC (RR.L): Technical Watch on..The Standard
Aug 17, 2017Rolls-Royce Holdings PLC (RR.L) and Auto Trader Group Plc (AUTO.L) Seeing..Union Trade Journal
Aug 16, 2017Stock Notebook: Rolls-Royce Holdings plc (LSE:RR.) Technicals UpdateBuckeye Business Review
Aug 16, 2017A Technical Look at This Dividend Stock: Rolls-Royce Holdings plc (LSE:RR.)Geneva Journal
Aug 16, 2017Market Tracker: Signals in Focus For Rolls-Royce Holdings PLC (RR.L)Rives Journal
Aug 16, 2017Rolls-Royce Holding PLC (RR) Given Underperform Rating at Credit Suisse GroupSports Perspectives
Aug 15, 2017Market Risers: Rentokil Initial plc, Rolls-Royce Holding PLC, Royal Bank of..DirectorsTalk Interviews
Aug 14, 2017Rolls-Royce Holdings PLC (RR.L) Tenkan Sitting Above KijunAiken Advocate
Aug 14, 2017Delving Into The Numbers For Rolls-Royce Holdings PLC (RYCEY)Melville Review
Aug 14, 2017Rolls-Royce Holding PLC (RR) Stock Rating Reaffirmed by JP Morgan Chase \u0026amp; CoWeek Herald

8.2 Corporate Wire

To view Recent Company Headlines, click here

August 03: Rolls-Royce announces dividend

Rolls-Royce today announced an interim dividend of GBX4.60 per share. The ex dividend date is Thursday, October 26 and it is payable on Friday, January 05, 2018.

August 03: Rolls-Royce: Holding(s) in Company

NOTIFICATION OF MAJOR HOLDINGS (to be sent to the relevant issuer and to the FCA in Microsoft Word format if possible)i

1a. Identity of the issuer or the underlying issuer of existing shares to which voting rights are attachedii:

Rolls-Royce Holdings plc

1b. Please indicate if the issuer is a non-UK issuer (please mark with an "X" if appropriate)

August 01: Rolls-Royce Holdings plc 2017 Half Year Results

Commenting on the results, Warren East, Chief Executive, said: "Rolls-Royce delivered encouraging year-on-year operational progress in the first six months of the year. Civil Aerospace large engine deliveries increased 27% and we made good further progress improving Trent XWB OE economics. Restructuring savings were ahead of plan.

July 31: Rolls-Royce: Total Voting Rights

Voting Rights and Capital

In accordance with DTR 5.6.1 of the FCA's Disclosure Guidance and Transparency Rules (DTR), the Company is required to notify the market of its total number of voting rights and capital as at the end of each calendar month.

The issued share capital of the Company is comprised of the following:-

July 11: Rolls-Royce: Director/PDMR Shareholding

Rolls-Royce Holdings plc (the Company) announces the following transactions by its Directors and PDMrs. and their persons closely associated as a consequence of:

The allotment to all ordinary shareholders of 71 C Shares on 3 July 2017 for every ordinary share held;

The redemption of C Shares for 0.1 pence each on 5 July 2017; and

State/Province/Country: United Kingdom

Country of Incorporation: United Kingdom

Exchange: London Stock Exchange

ISIN: GB00B63H8491

L:RR.; LON:RR.; LN:RR.; RR.L

PermID: 5033562382

Rolls-Royce Holdings Plc

Source: www.BuySellSignals.com