The Royal Mail share price is flying! Here’s what I’m doing now

July 5, 2021 0 Comments

first_img Enter Your Email Address Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. See all posts by Jabran Khan During the Covid-19 global pandemic, Royal Mail (LSE:RMG) has been a big winner. The rise in online shopping and parcel deliveries has benefitted the postal services provider. In turn, the Royal Mail share price is considerably higher than pre-market crash levels. With that in mind, do I invest my hard earned cash or not?Royal Mail share price since the crashSince the economic downturn, the RMG share price has experienced quite the roller-coaster ride. As with most other stocks across the markets, its price dipped in March, April and May. The lifting of restrictions in June saw its price begin a recovery of sorts. At its lowest point I could pick up shares for just 126p. Shares were trading for 182p per share in February. As I write this the Royal Mail share price is close to 340p. The news of a Covid-19 vaccine has boosted many stocks and investor sentiment is up too in my opinion.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Recent performance and Covid-19 implicationsWith the rise in parcel deliveries due to restrictions, RMG reported its parcel revenue superseded its letters revenue. This is the first time this has ever happened in its history. I’m not too surprised as sending letters is seen as something of a dying art, given advancements in technology and a changing demographic across the country.Despite Covid-19 being a fruitful time in terms of performance for RMG, it has also brought to light some of its deeper rooted issues. I believe the Royal Mail share price has been hindered by this despite its recovery since the crash. One of those problems is that of its reliance on revenue from the letters side of the business. In addition to this, it has failed to properly invest in the technology needed to grow the parcel side of the business. Furthermore, RMG has a unionised workforce that has caused issues such as strike action. The Royal Mail share price will have benefitted from the performance of its small international parcels operation, General Logistic Systems (GLS). Its recent interim results showed a revenue increase of over 20% and operating profit increasing by over 80%. I believe this small parcel arm could be a key part of RMG’s growth plans in the future.What I’m doing nowRecent analyst upgrades have helped the Royal Mail share price rally in my opinion. JP Morgan, Goldman Sachs, and UBS have all upgraded RMG shares in recent weeks. I believe these upgrades are linked to three main aspects: RMG’s performance at the height of the pandemic, a changing world whereby parcels rule over letters, and GLS’ positive results.I am not overly buoyed by RMG from an investment perspective and would not invest my money right now. For me, there are too many issues and a track record that doesn’t fill me with confidence. I believe RMG needs to invest heavily in technology and somehow reduce costs too. It will need to do this as well as contend with a unionised workforce. There is too much work to be done in my eyes. Casting aside the tempting Royal Mail share price, I am looking at alternatives such as this bank stock. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Jabran Khan | Monday, 14th December, 2020 | More on: RMG The Royal Mail share price is flying! Here’s what I’m doing nowcenter_img Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Simply click below to discover how you can take advantage of this. Jabran Khan has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Our 6 ‘Best Buys Now’ Shares I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Image source: Getty Images last_img read more