Bearish on RCL- pending Dividend cut.
This one is almost a gem, probably one of the easiest short out there.
We all know the cruise sector is taking a huge beating, there's no way they are going back to business until late summer or something.( we are talking at least 1 whole quarter of no income)
They will be burning money like crazy this quarter, and possible lawsuits and settlements eventually.
when this corona situation is all done and over with, they will need probably 2-3 years to even make back these losses.
With that said, There is NO WAY, they can maintain a 3.83 EPS for their next earning report. NO FREAKING WAY.
Their current dividend is $3.12 per share , their earning per share is $3.83, that is 81.51% payout to shareholders.
There is without a doubt that they will follow carnival and suspend their dividend soon. (just matter of when)
I am 100% sure that when they suspend dividend, a lot of people are going to drop this stock, which will cause some selling pressure.
The fundamental behind this play is almost on WALL ST HEDGE fund level lol.
Enjoy this free play & Good LUCK
Short entry 49.90
Cover position target 1 $40.90
Cover position target 2 $34.57
We all know the cruise sector is taking a huge beating, there's no way they are going back to business until late summer or something.( we are talking at least 1 whole quarter of no income)
They will be burning money like crazy this quarter, and possible lawsuits and settlements eventually.
when this corona situation is all done and over with, they will need probably 2-3 years to even make back these losses.
With that said, There is NO WAY, they can maintain a 3.83 EPS for their next earning report. NO FREAKING WAY.
Their current dividend is $3.12 per share , their earning per share is $3.83, that is 81.51% payout to shareholders.
There is without a doubt that they will follow carnival and suspend their dividend soon. (just matter of when)
I am 100% sure that when they suspend dividend, a lot of people are going to drop this stock, which will cause some selling pressure.
The fundamental behind this play is almost on WALL ST HEDGE fund level lol.
Enjoy this free play & Good LUCK
Short entry 49.90
Cover position target 1 $40.90
Cover position target 2 $34.57
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