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Rolls-Royce: It Might Get More Interesting Soon


  • Based on Rolls-Royce's performance, we might have seen the company reach some sort of trough since I wrote about it last. The company is actually up 5%.
  • Rolls-Royce does have things going for it - and it does have upside worth considering - at the right price, this British giant should have a place for investing.
  • Let's review the company to see if that time is approaching at this time.
  • Looking for more investing ideas like this one? Get them exclusively at iREIT on Alpha. Learn More »

Rolls-Royce Regional Customer Training Center. More Rolls-Royce products are built in Indianapolis than anywhere else in the world.


Dear readers,

I'm going to be updating on Rolls-Royce here (OTCPK:RYCEF). I've been writing about this company for over a year now, following its decline to its current levels. As of my last article, it seems that the company might

The company discussed in this article is only one potential investment in the sector. Members of iREIT on Alpha get access to investment ideas with upsides that I view as significantly higher/better than this one. Consider subscribing and learning more here.

This article was written by

Wolf Report profile picture

Wolf Report is a senior analyst and private portfolio manager with over 10 years generating value ideas in European and North American markets.

He is a contributing author for the investing group iREIT on Alpha where in addition to the U.S. market, he covers the markets of Scandinavia, Germany, France, UK, Italy, Spain, Portugal and Eastern Europe in search of reasonably valued stock ideas. Learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of EADSY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

While this article may sound like financial advice, please observe that the author is not a CFA or in any way licensed to give financial advice. It may be structured as such, but it is not financial advice. Investors are required and expected to do their own due diligence and research prior to any investment. Short-term trading, options trading/investment and futures trading are potentially extremely risky investment styles. They generally are not appropriate for someone with limited capital, limited investment experience, or a lack of understanding for the necessary risk tolerance involved. I own the European/Scandinavian tickers (not the ADRs) of all European/Scandinavian companies listed in my articles. I own the Canadian tickers of all Canadian stocks I write about. Please note that investing in European/Non-US stocks comes with withholding tax risks specific to the company's domicile as well as your personal situation. Investors should always consult a tax professional as to the overall impact of dividend withholding taxes and ways to mitigate these.

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Comments (21)

bazooooka profile picture
Might nibble more under eighty cents
R_Mitchell profile picture
@bazooooka Wait till under 50pp.
Excellent Breakdown!

Thanks for your article
R_Mitchell profile picture
Well maybe, if by soon you define 2025.
TheLongerView profile picture
Thank you for taking the time to research Rolls Royce. I enjoyed the article, but would have appreciated hearing more about the downside risk. In particular, what is the risk of a bankruptcy / reorganization that takes the share price to zero?

This company fits my investment profile of buying "beaten down" stocks with huge upside potential. But the FIRST thing I look at is DEATH potential. I am not convinced that this company is going to survive. It would have been nice to hear your thoughts on existential risk. Thanks.
the danger is that RR would be nationalised since i believe it is considerered as a strategic company and the UK gouvernment already possesses a golden share
R_Mitchell profile picture
@TheLongerView Close to zero. It's just too strategic for the defence sectors of both UK & US and it's nuclear reactor activities will also be strategic for the UK energy sector in the years to come. There are two options in case things go south, 1- A takeover by a US (most possibly) or European engineering group (way less possible, but not entirely impossible). In this case the take over price will almost certainly be above current levels, as the upcoming revenues of RR for the next few years are considered secure (in the absence of any dramatic macroeconomic or geostrategic developments). 2- Nationalization. I don't think the UK government will wish to go down that road but, in the absence of any other viable alternative, they will just have to. One can only speculate at what levels will the government wish to buy any free float. I assume it will be to much lower levels than today.
do you think a merger of RR with General electric or Siemens would be possible under the current regulatory conditions ? For Siemens it would be a venture into jet engines
The french alstom was absorbed by GE
Dicktater143 profile picture
So you wrote an article saying you won’t buy , but you think it will have a massive recovery , but then cut the price target … odd , that’s a lot of double talk there .
TheLongerView profile picture
@Dicktater143 I think the issue here is timing. If the company's short term looks like more potential downside, but the long term appears to have substantial upside, then that explains what may seem like "double talk". That is why (please see my comment above) I asked about the potential for this stock to go to zero. I don't mind buying a beaten down stock that will ultimately improve. And I never expect to hit the absolute bottom with perfect timing, since trying to time the market is a fool's errand. But buying a stock that doesn't pay a dividend and has a substantial risk of going bankrupt is a different matter.
@Dicktater143 it’s not a pony ready to take off out the gate, but a real good one to keep an eye on.
Dicktater143 profile picture
@T P S I hold a rather large position at a low cost average so I am happy to hold long term . This company isn’t going anywhere with the connection to England’s infrastructure.
Twobeerjohn profile picture
Rolls Royce cars look like rolling caskets ⚰️
R_Mitchell profile picture
@Twobeerjohn It's not about the cars, those are run by BMW.
Would be great to hear your updated view on Telenor after the q2 earnings. Market didn't like it and share price is heading down, yield now at 8% which is enough for total return if they can just maintain it.
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