HAL. As an Investment?

[sfaaa]

Wall Street is not panicking on CCL or HA.

[Indianadaytripper]

If cruise companies were U.S. companies there would be much more urgency in getting them started, this would greatly increase there value. in my view.

[Mary229]

1 hour ago, Mary229 said:

clearing understanding

Oops, clearly understanding

[KirkNC]

1 hour ago, Hlitner said:

I will toss another monkey wrench into this discussion.  Many (we have no way of knowing the real number) cruise customers were lured into accepting generous Future Cruise Credits (FCCs) in lieu of refunds from their cancelled voyages.   While these FCC deals looked lucrative to many, a few of us did immediately sound warnings and suggested "take the refunds."  So now there are huge amounts of outstanding FCCs (in accounting terms these are "accounts payable" and a liability to the cruise lines).  If the cruise lines are forced into bankruptcy these FCCs may well become worthless (or perhaps worth pennies on the dollar).  In a perverse way the cruise lines have managed to use their own customers to provide them with interest free debt financing.  And no, the credit card companies have no obligation to help out with FCCs that go bad.  When folks voluntarily gave up refunds for more generous FCCs they made their own bed.

 

Hank

Personally I am of the opinion that all cruise line customer deposits, including FCC, should have to be segregated and maintained in a trust like account to protect the consumer in the event a line does exactly what you are talking about.  Those in Europe may have this protection which is one reason why they are charged more.

Edited February 11, 2021 by KirkNC

[KirkNC]

19 minutes ago, Indianadaytripper said:

If cruise companies were U.S. companies there would be much more urgency in getting them started, this would greatly increase there value. in my view.

Perhaps but the sooner they start the better for them and their valuation.

[Hlitner]

1 hour ago, sfaaa said:

Wall Street is not panicking on CCL or HA.

Most investors would agree there are many different factors involved in analyzing a stock.  One of my personal favorite factors (to get a quick snapshot of a company) is to look at the insider trading situation.  For those who do not understand this stuff, insider trading tells you what key executives and board members are doing with their own stockholding.  Reporting of this (by insiders) is a regulatory requirement for US companies listed on the stock exchanges.  In the case of CCL it is quite interesting.  In the past three months insiders have purchased exactly $0 of CCL Stock.  During the same period they have sold nearly $104 million.   This could be construed as an indication of what the insiders are thinking about the near future of CCL stock.  You can draw your own conclusions.

 

Hank

[KirkNC]

1 hour ago, sfaaa said:

Wall Street is not panicking on CCL or HA.

 HA is not listed on Wall Street only CCL and CCL the stock is down $51/share or 71% from its highs so I would not say the market is not concerned.  Now it has bounced off its lows but whether that is a dead cat bounce or not only time will tell.  Google CCL and you will find lots of analysts who have concerns.

[KirkNC]

1 minute ago, Hlitner said:

Most investors would agree there are many different factors involved in analyzing a stock.  One of my personal favorite factors (to get a quick snapshot of a company) is to look at the insider trading situation.  For those who do not understand this stuff, insider trading tells you what key executives and board members are doing with their own stockholding.  Reporting of this (by insiders) is a regulatory requirement for US companies listed on the stock exchanges.  In the case of CCL it is quite interesting.  In the past three months insiders have purchased exactly $0 of CCL Stock.  During the same period they have sold nearly $104 million.   This could be construed as an indication of what the insiders are thinking about the near future of CCL stock.  You can draw your own conclusions.

 

Hank

Also look at the high level (greater then 10%) of shorts in play.  These are people betting with real money that the stock will go down.

[KirkNC]

2 minutes ago, Hlitner said:

Most investors would agree there are many different factors involved in analyzing a stock.  One of my personal favorite factors (to get a quick snapshot of a company) is to look at the insider trading situation.  For those who do not understand this stuff, insider trading tells you what key executives and board members are doing with their own stockholding.  Reporting of this (by insiders) is a regulatory requirement for US companies listed on the stock exchanges.  In the case of CCL it is quite interesting.  In the past three months insiders have purchased exactly $0 of CCL Stock.  During the same period they have sold nearly $104 million.   This could be construed as an indication of what the insiders are thinking about the near future of CCL stock.  You can draw your own conclusions.

 

Hank

I bet those insider are tickled to be able to liquidate at $20/share.

[Hlitner]

12 minutes ago, KirkNC said:

Personally I am of the opinion that all cruise line customer deposits, including FCC, should have to be segregated and maintained in a trust like account to protect the consumer in the event a line does exactly what you are talking about.  Those in Europe may have this protection which is one reason why they are charged more.

Kirk, I like your idea but "it ain't gong to happen" :(.   I would assume that in order to protect customers with deposits, those monies would need to be held by a third party and structured in a way to shield the funds from getting tied up in any possible bankruptcy.  I would not even speculate whether there is a legal way to do this with FCC's since they are just promises and not real money.

 

Hank

[Hlitner]

5 minutes ago, KirkNC said:

Also look at the high level (greater then 10%) of shorts in play.  These are people betting with real money that the stock will go down.

And there is Game Stop  :).  I do think short selling now has a "smell" that turns off many investors.  But that is a topic for a financial blog LOL,

 

Hank

[KirkNC]

1 minute ago, Hlitner said:

Kirk, I like your idea but "it ain't gong to happen" :(.   I would assume that in order to protect customers with deposits, those monies would need to be held by a third party and structured in a way to shield the funds from getting tied up in any possible bankruptcy.  I would not even speculate whether there is a legal way to do this with FCC's since they are just promises and not real money.

 

Hank

Yea the extra amount (the 25% kicker) in FCC would require the cruise line to fund them as opposed to regular customer deposits which are funded by the customer.  Other industries use trust accounts (real estate attorneys come to mind) and as I say, in the back of my mind I think European customers are protected somehow.  Maybe one of our European friends will chime in.

[iancal]

We never buy gift cards for retail or entertainment for that very reason.  If we want to give a gift, we gift cash/cheque rather that a gift card.

 

Perhaps not as discreet but certainly much more flexible and of course much safer these days with all of the closures.

Edited February 11, 2021 by iancal

[Hlitner]

4 hours ago, Mary229 said:

I think we know.  We all have different balance sheets and different risk-reward profiles.  I venture to guess that most people on this HAL board have spent their lives managing their finances well clearing understanding the risks involved

Notwithstanding fellow HAL fans, my post was aimed at CCL stockholders of which HAL is only a small part.  There have been numerous posts on some other boards about folks having 2nd thoughts regarding their acceptance of FCCs and later trying to get their FCCs converted back to real refunds.   One problem we have with FCCs (besides the financial risk) is that it takes away our flexibility to book other cruise lines (we cruise on many different lines).  We do have a substantial HAL FCC (which was given in addition to a full refund on a cancelled cruise) that we keep rolling over to new bookings (since we have now had several cruises cancelled due to COVID).

 

Hank

[rkacruiser]

2 hours ago, Hlitner said:

In the case of CCL it is quite interesting.  In the past three months insiders have purchased exactly $0 of CCL Stock.  During the same period they have sold nearly $104 million.   This could be construed as an indication of what the insiders are thinking about the near future of CCL stock.  You can draw your own conclusions.

 

I appreciate learning this.  That is a telling statistic in my opinion.  But, for those of us who are owners of more than the basic number of shares, what do these "tea leaves" mean?  Time to sell?  Time to hold?  (Time to cue Kenny Rogers' The Gambler?)

 

I have thought from the beginning of these FCC being issued and accepted in lieu of refunds that this could be a new version of a Ponzi scheme.  I have so stated on this Message Board in the past.  Non-refunded money and new deposits for cruises that may/may not happen are helping to keep CCL afloat.  In my opinion, of course.

 

If Mr. Arison and/or any or all of the financial associated entities connected with the Arison family start to sell:  it would be time to rush to the exit as quickly as possible.    

 

 

[Lido - Lanai]

3 hours ago, Hlitner said:

During the same period they have sold nearly $104 million.

I'd venture to guess the majority of the sales were required as part of their stock option scheme. It happens during the 1st calendar quarter every year. I was forced to sell options in January every year. I worked for a different company but most stock option benefit plans have the same requirement.

[prescottbob]

 I'm not a Wall Street investment wizard by any means. I was unable to dump our 100 shares of CCL stock back in March (on the '20 WC when I first heard of the pandemic and repercussions) that we've had and have enjoyed for years since purchase in the late '90's ('96-97?, I can't remember).

 

We've used the stock ownership for OBC's (and dividends) for years on HAL, Princess, Cunard and Seabourne like others on this board with no problems.

However, with all the Covid stuff, and lack of sailings I dumped the stock this past December for pretty much what I paid for it back in the 90's. No gain, no pain but lots of OBC's and good dividends over the years.

 

If I become convinced that CCL will surely survive I'd be happy to purchase back the 100 shares and enjoy the perks. Until then I'm just "hanging out" like most folks.

 

BTW. we have a couple of cruises booked for 2022 using FCC's leftover from the '20 WC (we did the 50/50 refund & FCC thingy).

 

We'll see how it all shakes out. I'm optimistic but also a realist.

 

be well.

Bob  

[rkacruiser]

4 minutes ago, prescottbob said:

 I was unable to dump our 100 shares of CCL stock back in March

 

Are you willing to inform us--do you know--why you were unable to sell those shares?  

[prescottbob]

10 minutes ago, rkacruiser said:

 

Are you willing to inform us--do you know--why you were unable to sell those shares?  

 

The Amsterdam Wi-Fi was iffy (we floated about for a week) at best and, well to be honest, my first go at logging on to  Ameritrade caused problems. It was an old day trader account. 

 

To be honest, there were so many other things going on (getting AL tickets out of Perth, packing & such to get out of OZ prior to the official 'lockdown' ) that a $2.2  K investment sort of went on the "back burner". at the time.

 

Be well.

Bob

[rkacruiser]

5 minutes ago, prescottbob said:

 

To be honest, there were so many other things going on (getting AL tickets out of Perth, packing & such to get out of OZ prior to the official 'lockdown' )

 

Thank you for your reply.  Very, very understandable.  

[LocoLoco1]

Didn’t the Saudi Royal Family (or the Saudi Sovereign piggy-bank) advance CCL monies early on after Covid hit?? Then also a large issuance of new Common Stock, yes?. I see a new ‘re-structured’ CCL before this is all said and done. Me?? We were unceremoniously left nearly at the HAL Gangplank in Mid-March 2020. As comp. we were given ALL our expenses back, PLUS a future cruise (in FCC’s) equal in value to that cancelled 35-day cruise. So... I have essentially re-booked multiple times with ‘The House’s Casino Chips’. Unless CCL goes into Administration, Ch. 7, 11, or whatever, I and a great many other thousands will be booking future cruises with a CCL that is barely treading water. No $profit$ in honoring all those FCC’s for CCL. How odd.  

[iancal]

It is very easy to check on insider stock trades.  Simply go to somewhere like yahoo finance, key in CCL (or any other stock) and that page will lead you to the details.   Dates, shares, per share price, proceeds, etc.   I used to look up this data for my employer when I was determining when might be best  to exercise/immediately sell stock options.

 

You can view exec compensation,  stock grants to key employees, etc.  It is all there.  Very easy to access.

Edited February 12, 2021 by iancal

[rodndonna]

11 hours ago, prescottbob said:

 I'm not a Wall Street investment wizard by any means. I was unable to dump our 100 shares of CCL stock back in March (on the '20 WC when I first heard of the pandemic and repercussions) that we've had and have enjoyed for years since purchase in the late '90's ('96-97?, I can't remember).

 

We've used the stock ownership for OBC's (and dividends) for years on HAL, Princess, Cunard and Seabourne like others on this board with no problems.

However, with all the Covid stuff, and lack of sailings I dumped the stock this past December for pretty much what I paid for it back in the 90's. No gain, no pain but lots of OBC's and good dividends over the years.

 

If I become convinced that CCL will surely survive I'd be happy to purchase back the 100 shares and enjoy the perks. Until then I'm just "hanging out" like most folks.

 

BTW. we have a couple of cruises booked for 2022 using FCC's leftover from the '20 WC (we did the 50/50 refund & FCC thingy).

 

We'll see how it all shakes out. I'm optimistic but also a realist.

 

be well.

Bob  

 

On a positive note - it was fortuitous that your Wifi was crappy when you tried but were unable to dump the stock in March 2020 since it doubled by Dec when you were able to sell it for a break even.

 

Our investment philosophy would have been very different - at that point in March when that investment was suddenly worth only about $1000 (so a capital loss of 50%) yet had likely been yielding me substantially more than that over 25 years in dividends and OBC credits, I would have happily let it ride. 

[drowelf]

Over the years, I've been in and out of both CCL and RCL to varying degrees, sometimes I've only held the standard 100 shares, other times considerably more as market conditions warrant. At this point we are just sitting on the nominal 100 shares of each. Bought big back in the early days of Covid and got out near one of the highs last summer. Turned a nice profit, but now things are pretty stable. CCL has only varied about 10% in price over the last 6 months. RCL has been a bit more volatile, but still no really large swings. So I'm content to just wait and see. Since both CCL and RCL seem to have enough cash for all or most of 2021, I don't think anything major is going to happen until later this year. Whether cruising gets started this year will be a big indicator as to the long term health. 

 

As I stated in another post, I don't think cruising will go away, but what lines, within CCL/RCL/NCL survive and what it is going to look like in 2022, 2023 and onward is very murky at this point and only time will tell. 

 

 

Edited February 12, 2021 by drowelf

[iancal]

Investing is not binary.   We would not consider HAL, or really CCL, by itself or even in the industry,  but rather in comparison to other investment options, long term or short term, that are on offer.