Reynolds American Story Overview

RAI -- USA Stock  

null 66.89  0.00  0.00%

Macroaxis News
  
By David Taylor

Reynolds American Inc. is the old R.J. Reynolds tobacco company.  This company is interesting in many ways.  To begin with you have to first get over any person obstacles of the company being a tobacco company and look at it from the perspective of being a business.  The company’s earnings have been steady but should be moving higher.

Tobacco Products
Fama & French Classification
Reynolds is the maker of cigarettes and is a great source of cashflow for a portfolio.

If you do not mind the product itself, cigarettes, Reynolds is a cash flow generating company.  Thier price is a little bit high at this moment but any moves lower in the equity markets and you would want this stock in your portfolio as they consistently bring in revenue and earnings. 




Reynolds American Inc. is the old R.J. Reynolds tobacco company.  This company is interesting in many ways.  To begin with you have to first get over any person obstacles of the company being a tobacco company and look at it from the perspective of being a business.  The company’s earnings have been steady but should be moving higher.  Here, we can see the past few year’s worth of revenue, income and  earnings-per-share laid out:

2011:   $8,541.0 $2,447.0 $2.41

2012: $8,304.0 $2,492.0    $2.25  

2013: $8,236.0 $3,103.0    $3.15 

2014: $8,471.0 $2,654.0    $2.76  

2015: $10,675.0 $7,076.0    $2.57  

Given this earnings listing and where I like to look for potential investments, the stock is trading at $50 per share.  That is nearly 20-times earnings.  But, this is a company that I have my eye on for a few reasons and I will explain.  

First, I am a firm believer that the equity market is going to come down to a more realistic earnings per share ratio.  That will allow for a better entry opportunity.  The current overall price-to-earnings ratio is too rich historically; the ratio is trading at 26 whereas normally it is 15.  So, a stock that is trading at a 20-times earnings should come down proportionally and offer an opportunity around the 12-times earnings.  This kind of company is something that tI like with regards to a long-term holding.  This company is predictable and consistent.  

This is the kind of company that you are looking for when it comes to creating long term wealth and income.  It is because of their predictability that this company is so attractive to me with regards to putting it in my own portfolio.  But, I will only do so at a price that makes sense, and just about no prices make sense right now.  The price-to-earnings ratio is too rich to be sensible; 26 is far too high.  

I have been diligently putting together a list of stocks that I will be adding in to my own portfolio when the market comes back down to better prices, once the euphoria of the Republican election wears off.  I am looking to add this company into my portfolio because it can profile an earnings and dividend that will make for a long-term retirement holding.  

One of the things that does stand out to me from the list above is the revenue from 2014 - 2015.  That is a huge jump.  There was another huge leap in the operating profits.  However, there was a slight drop in earnings-per-share.  This is more of a one-off than anything and it is my belief that the company’s numbers will realign themselves with what they have been doing over the past few years.  In the meantime, the moves have allowed for the company’s stock to position itself to head much higher should the revenue continue to increase as it has.  Given the bigger revenue jumps the company will be well positioned to increase its earnings potential on a per-share basis.  This will push the company’s stock up significantly.

Certainly there are some out there that will not want to get involved in a company that deals with the products that Reynolds does.  Others will be able to see this company as it is, yet another business that trades on the stock exchanges.  There is really, long-term opportunity here.  I am considering this stock for my own portfolio.  I will be doing so when the stock move down in price, but keeps its earnings continually moving higher.  The overall equity market is too high, it will be coming down.  That would be a good time to pick up more of this stock.

Story Momentum

This article from Macroaxis published on 17 of January contributed to the next trading period price escalation.The trading delta at closing time to the next next day price was 0.55% . The trading delta at closing time when the story was published to current price is 15.97% .

Similar stores for Reynolds American

a day ago at www.macroaxis.com 
Disposition of 23838 shares by Susan Cameron of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc officer. Disposition to the issuer of issuer equity securities pursuant to Rule 16b-3
few days ago at http://weekherald.com 
Tdam USA Inc. Sells 5830 Shares of CMS Energy Co.
news
Week HeraldFull coverage
over a week ago at http://friscofastball.com 
Winslow Capital Management LLC Lowered Its Amazon Com INC Stake by 48.40 Million as Market Valuation ...
news
Frisco FastballWinslow Capital Management LLC Trimmed Position in Amazon Com INC as Share Price Rose KL DailyAs Metlife Market Valuation Rose, Holder Baldwin Investment Management Trimmed Holding by 335025 ... HuronReportAmazon.com, Inc. Makes a Leap With the Fire TV Cube Investorplace.comFull coverage
over a week ago at www.macroaxis.com 
Acquisition by Luc Jobin of 173 shares of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc director. Grant, award or other acquisition pursuant to Rule 16b-3
over two weeks ago at www.macroaxis.com 
Exercise or conversion by Creighton Frances V of 2763 shares of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc officer. Exercise or conversion of derivative security exempted pursuant to Rule 16b-3
over two weeks ago at www.macroaxis.com 
Sale by Powell H G L Hugo of 400 shares of Reynolds American
Macroaxis News
Filed transaction by Reynolds American Inc director. General open market or private sale of non-derivative or derivative security
over three weeks ago at www.macroaxis.com 
Payment of 22989 shares by Adams Thomas R of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc officer. Payment of exercise price or tax liability by delivering or withholding securities
over a month ago at www.macroaxis.com 
Sale by Debra Crew of 479 shares of Reynolds American
Macroaxis News
Filed transaction by Reynolds American Inc officer. General open market or private sale of non-derivative or derivative security
over a month ago at www.macroaxis.com 
Acquisition by Goings E V of 121 shares of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc director. Grant, award or other acquisition pursuant to Rule 16b-3
over a month ago at www.macroaxis.com 
Disposition of 7426 shares by Payne Tommy J of Reynolds American subject to Rule 16b-3
Macroaxis News
Filed transaction by Reynolds American Inc officer. Disposition to the issuer of issuer equity securities pursuant to Rule 16b-3
over a month ago at www.macroaxis.com 
Purchase by Monteiro De Castro Antonio of 200 shares of Reynolds American
Macroaxis News
Filed transaction by Reynolds American Inc director. General open market or private purchase of non-derivative or derivative security
over two months ago at http://macondaily.com 
Analyzing Imperial Brands and Reynolds American
news
Macon DailyFull coverage
over three months ago at http://bangaloreweekly.com 
Sale by Frederick Smothers of 300 shares of Reynolds American
news
Filed transaction by Reynolds American Inc officer. General open market or private sale of non-derivative or derivative security

Latest Stories

Recently Published Stories

Beta

Beta Comparative Analysis
  Beta 
      Reynolds American Comparables 
Reynolds American is currently under evaluation in beta category among related companies. Beta is one of the most important measures of equity market volatility. Beta can be thought of as asset elasticity or sensitivity to market. In other words, it is a number that shows the relationship of financial instrument to the financial market in which this instrument is traded. For example if Beta of equity is 2, it will be expected to significantly outperform market when market is going up and significantly underperform when market is going down. Similarly, Beta of 1 indicates that an asset and market will generate similar returns during over time.
Additionally take a look at Your Equity Center. Please also try Chance of Distress module to get analysis of equity chance of financial distress in the next 2 years.