Reading Story

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RDI -- USA Stock  

USD 3.80  0.11  2.81%

Reading International is scheduled to announce its earnings today. The stock goes through a sell-off trend. Reading International Earnings before Tax are most likely to increase significantly in the upcoming years. The last year's value of Earnings before Tax was reported at 24.94 Million. The current Invested Capital is estimated to increase to about 322.2 M, while Net Income Per Employee is projected to decrease to (9.1 K). Although many aggressive traders are getting into communication services space, Reading International may or may not be your first choice. I will address a few possible reasons stockholders do not currently respect this stock.
Published over two weeks ago
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What is December outlook for Reading (NASDAQ:RDI)?
Reading International has 511.66 M in debt with debt to equity (D/E) ratio of 4.85, demonstrating that Reading International may be unable to create cash to meet all of its financial commitments. The entity has a current ratio of 0.5, suggesting that it has not enough short term capital to pay financial commitments when the payables are due. About 22.0% of the company outstanding shares are owned by corporate insiders. Reading International has price-to-book ratio of 0.5. Typically companies with comparable Price to Book (P/B) are able to outperform the market in the long run. The entity recorded a loss per share of 2.5. The firm had not issued any dividends in recent years. Reading International had 3:2 split on the 26th of April 1993.
Reading International financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Reading International, including all of Reading International's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Reading International assets, the company is considered highly leveraged. Understanding the composition and structure of overall Reading International debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding Reading Total Debt

Reading International liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Reading International has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Reading International balance sheet include debt obligations and money owed to different Reading International vendors, workers, and loan providers. Below is the chart of Reading main long-term debt accounts currently reported on its balance sheet.
You can use Reading International financial leverage analysis tool to get a better grip on understanding its financial position

How important is Reading International's Liquidity

Reading International financial leverage refers to using borrowed capital as a funding source to finance Reading International ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Reading International financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Reading International's total debt and its cash.

Reading International exotic insider transaction detected

Legal trades by Reading International insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Reading insider trading alert for general transaction of stock options; right to buy; class a non-voting common stock by Douglas McEachern, the corporate stakeholder, on 24th of September 2020. This event was filed by Reading International Inc with SEC on 2020-09-24. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down the case for Reading International

The firm reported the last year's revenue of 191.92 M. Reported Net Loss for the year was (55.21 M) with profit before taxes, overhead, and interest of 57.27 M.

Liabilities Breakdown

114.4 M
Current Liabilities
186 M
Long-Term Liabilities
Total Liabilities582.24 Million
Current Liabilities114.41 Million
Long-Term Liabilities186 Million
Tax Liabilities16.55 Million

Will price continue to rise in December 2020?

Current potential upside is at 4.41. Reading International exhibits very low volatility with skewness of 2.07 and kurtosis of 10.61. However, we advise investors to further study Reading International technical indicators to make sure all market info is available and is reliable.

The Current Takeaway on Reading International Investment

While other companies under the entertainment industry are still a bit expensive, Reading International may offer a potential longer-term growth to stockholders. While some stockholders may not share our view we believe that the current risk-reward utility is not appealing enough to do any trading. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Reading International.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Reading International. Please refer to our Terms of Use for any information regarding our disclosure principles.

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