Investing in a Rolex GMT “Rootbeer” vs. Delta Airlines Stock

Image Source: Swisswatchexpo

What does soda, Rolex and Delta airlines have in common? It may seem like a stretch, but bear with us because the financial comparison between soda, Rolex and Delta airlines is actually pretty fascinating and surprising. Today we’re going to be looking closely at the Rolex GMT Master II 126711 “Rootbeer” a soda-named watch, from a financial gains and investment standpoint.  By the way...have you ever wondered why so many Rolex nicknames are sodas? 

The Rolex “Rootbeer” gets its nickname from the original GMT Master II 16753, which sports a brown bezel and dial with tan accents, colors reminiscent of the soft drink. However, the association we are looking at today is between the watch and the airline the watch was originally designed for. Pan American Airlines originally approached Rolex to design a watch that could display two time zones for their pilots, and thus the GMT Master II was born. You can read more about the interesting history here!

Rolex GMT Master II “Rootbeer” Investment vs. Delta Airlines Stock

The Rootbeer evolved from the original blue and red color combination of the GMT Master now known as the “Pepsi”. In this article, we’ll be comparing both Rolex Rootbeers, the original Rolex Ref. 16753 and the more modern ceramic bezel Rolex Ref. 126711. Those keen observers among us might notice that Pan Am no longer exists as an airline today, and they’d be correct. Pan Am filed for bankruptcy protection in 1991, and the majority of their profitable assets were bought by Delta Airlines. Because of that, we’ll be comparing the watches to Delta Airlines publicly traded under the ticker “DAL” on the New York Stock Exchange.

How has the Rolex GMT Master II “Rootbeer” fared as an investment?

The more modern GMT Master II 126711 was originally released at Baselworld 2018 for an MSRP of $14,050; it quickly became a hot watch as collectors looked for alternatives to the popular GMT Master II Pepsi and Batman. As of writing, it trades on the grey market at a price of $21,521 or a gain of 53% over three years. Undoubtedly a solid investment.

Image Source: dmarge 

The older 16753 was originally sold in the 1980s, however, we can look at historical grey market prices to get a feel for how well it’s performed in recent years. To make this a fair apples to apples comparison, we’ll look at its price in 2018 and compare it with its current price. In 2018 the 16753 was trading for $7,943. Today that number is $11,782, a 48% gain, very similar to its modern counterpart

How has Delta Airlines fared in the Stock Market?

Things take a turn when we look at Delta airline’s stock. In 2018 it was trading for approximately $59.33 a share, but, as of writing, the stock sits at $44.12. That’s a loss of 26%. This may come as a surprise because in our previous articles about the Pepsi, Coke, and Hulk, all the companies we used for comparison ended up increasing in price over the observed time period, albeit not as much as the watch.

It’s no secret that the airline industry has been heavily impacted by the COVID-19 pandemic, and this weakness for Delta shares may be a small setback. We can’t know how the stock or the watches will fare in the future, but my guess is if we wrote this article in two years, we might be telling a very different story.

Image Source: Fox News

Final Thoughts on Rolex “Rootbeer” Investment vs. Delta Airlines Stock Investment

We must keep in mind that this doesn’t necessarily mean Delta’s stock is bad. It may be a short term dip due to COVID-19 and could indicate that the stock is selling at a relatively attractive discount. This could be a signal to buy, especially if you believe that the stock will appreciate (go up) in the future. The same logic can be applied to watches, if you notice a certain model or year of watch selling for cheaper than similar watches, that doesn't necessarily mean that the watch is a bad investment. It could mean that it’s being overlooked by other collectors and once it becomes appreciated for what it is it may increase in value significantly. 

One example of this is the Stella-dialed Rolex watches that didn’t sell well at all when they were first released and now are almost completely unattainable for most people from a financial standpoint. The newest iteration of the turquoise dialed Oyster Perpetual 41 that mimics the Stella dialed Rolexes from years past is now selling for four times MSRP on the grey market, so things can change quickly when it comes to investments. 

What would you rather spend your money on? A Rolex GMT Master II, or Delta Airline Stock? We love a good debate. Tell us in the comments.

If you’re lucky enough to have either a newer GMT Master II Rootbeer or the original GMT Master Rootbeer, you can get straps for both over at the Everest Bands store! Not to mention, travelling with your watches is significantly easier and safer with our premium leather watch rolls and watch portfolios. Get yours today.

By: Joshua Jiang