AIR - Air NZ.

[Beagle]

With all due respect the evidence doesn't appear to back this up. Witness the huge upwards push of most world-wide airlines share prices since the sea change regarding the price of oil a year ago. Airlines, globally haven't been this profitable for many, many years. About time some of them turned a dollar. Interestingly AIR returned a 15% return on invested capital last year when oil was over $100 barrel on average. Augers well for future profits doesn't it !!

[sb9]

Yep couldn't agree more, yet market still seems bit circumspective.

[Beagle]

I think its general economic concerns mate. Slightly softer economy and all that. The marketing team did very well to fill the extra circa 6% seat mile capacity increase last year. The "Briscoes" sale strategy seems to be working well so far. The other thing that's being talked up at present is tourism and certainly the dollar falling like it has makes clean green New Zealand a much more attractive destination.

[KiwiGekko]

With all due respect the evidence doesn't appear to back this up. Witness the huge upwards push of most world-wide airlines share prices since the sea change regarding the price of oil a year ago. Airlines, globally haven't been this profitable for many, many years. About time some of them turned a dollar. Interestingly AIR returned a 15% return on invested capital last year when oil was over $100 barrel on average. Augers well for future profits doesn't it !!

Totally agree, but I must say to my naked eye other airline stocks see a much greater correlation than AIR.

Oh well only 14 days until we find out how well AIR is going eh?

[Beagle]

Yeah... that Qantas SP really stings doesn't it !

[blockhead]

Didn't notice any more than 3-4 empty seats coming back from Fiji yesterday, also didn't see too many dairy cockies lounging around the pool while I was there. Their chq books definitely closed up, beware HNZ holders.

Good for AIR

BULA !

[Regi]

Love the new safety video!

https://www.youtube.com/user/airnewzealand

If the airline business doesn't work out for AIR, they could always move into the media production business :t_up::D

[neyney2010]

Love the new safety video!

https://www.youtube.com/user/airnewzealand

If the airline business doesn't work out for AIR, they could always move into the media production business :t_up::D

There goes our sp divi....

[axe]

Love the new safety video!

https://www.youtube.com/user/airnewzealand

If the airline business doesn't work out for AIR, they could always move into the media production business :t_up::D

This is the video the ozzies will take the mickey out of when we lose the RWC :scared:

[sb9]

Love the new safety video!

https://www.youtube.com/user/airnewzealand

If the airline business doesn't work out for AIR, they could always move into the media production business :t_up::D

Cool ad, very slick and captivating.

[QOH]

I hope the safety video is better than AIRNZs latest TV ad, I find that song so irritating.

[Beagle]

I hope the safety video is better than AIRNZs latest TV ad, I find that song so irritating.

Its looooooong. 90 seconds advertisement in prime news time....:ohmy: that's gotta cost a few bucks.

[KiwiGekko]

http://www.stuff.co.nz/travel/kiwi-traveller/71092926/new-air-nz-dawn-deals-to-offer-international-fares-as-low-as-99 - looks interesting, might be time to book a trip.

[Beagle]

This is the video the ozzies will take the mickey out of when we lose the RWC :scared:

The All Blacks didn't look dynamic did they !!

[Regi]

Well the market didn't like the video released today LOL

[Joshuatree]

Agree, there's no direct correlation between oil prices and air's sp.

Having said that, its interesting to note how the oil landscape is undergoing huge shift atm.

Good volume already through, think it'll break out of $2.70 today...

Broke out alright; to the downside on increasing vol unfort.Another stock nearing 50 and 200DMA.

[Beagle]

Well the market didn't like the video released today LOL

That'd be because all the male investors really want the safety in paradise video brought back :D and maybe because all those fit looking men in black make their own beer bellies look :(
Shall we have another look at the best gem of all ?...why not https://www.youtube.com/watch?v=q0tkeGPG_8Q As good as the men in black one is...sadly there's no improving on perfection is there !

[sb9]

Broke out alright; to the downside on increasing vol unfort.Another stock nearing 50 and 200DMA.
That's the nature of market JT, don't worry mate it'll be another story today.

[Beagle]

Some nice sunrise deals today. For anyone thinking they have to get up at sunrise to get the deal there is good news. The time of the release of seats is in the sunrise of the destination country. e.g. seats were selling to Shanghai for $399 each was a little while ago. That's a decent 24 hours of the new Dreamliner for $800...I don't especially want to go to Shanghai but it crossed my mind just to go for a ride on the new bird :)
Hong Kong is now on special for the same price...even more tempting.
http://wheretonext.airnewzealand.co.nz/dawndeals/?utm_source=edm&utm_medium=email&utm_campaign=AP_SO_Dawn_Deals_20150813

[sb9]

So, exactly a week to go before they announce FY results. In the meantime, QAN reports their earnings tomorrow which might gives us an indication of what low oil prices are doing to the Airlines industry overall, eh Roger?

[Beagle]

Think Supercharger or Turbocharger mate...whichever boost mechanism is your choice, we're talking HIGH BOOST !!
AIR being priced like Oil goes back to $100 next year...but I reckon it won't.

[Beagle]

Looking likely to test $40 a barrel shortly. Under $41 for Nymex now, lowest in 6 1/2 years. Last oil hedge document they disclosed, AIR had very little forward cover on oil so AIR's jet engines will be lapping up the cheap stuff and the profits will go straight to the bottom line :)

[ace5715]

Off to China for work again tomorrow night, glad to be helping Air New Zealand make a profit.

[sb9]

Looking likely to test $40 a barrel shortly. Under $41 for Nymex now, lowest in 6 1/2 years. Last oil hedge document they disclosed, AIR had very little forward cover on oil so AIR's jet engines will be lapping up the cheap stuff and the profits will go straight to the bottom line :)

I think it'll be all guns blazing next week from Monday I reckon.

[Joshuatree]

QAN strongest profit since before the GFC
$505 m cap return
turnaround of $1.6 billion.
Hope you suckers who bought AIR in the $2.90's get more than your money back soon.

[sb9]

Here is the link,

http://www.smh.com.au/business/aviation/qantas-soars-to-975m-profit-on-back-of-cost-cutting-cheaper-fuel-20150819-gj2evv.html

23c capital return in early Nov.

Well, if this is what QAN can do, can only imagine how solid AIR performance would be come Wednesday!!!

[Beagle]

QAN strongest profit since before the GFC
$505 m cap return
turnaround of $1.6 billion.
Hope you suckers who bought AIR in the $2.90's get more than your money back soon.

Unnecessary term IMO. Consensus EPS forecast on 4 traders is 41 cps for FY16, stock is on a FY16 PE of only 6.5 !! Qantas hasn't paid a dividend for 6 whole years whereas if your check you'll see AIR has paid consistent dividends throughout that time including a 10 cent special dividend in tandem with last year's final dividend.

[Joshuatree]

Suckers rally in May to re $2.99 before the drop to re $2.39. The threads were going off, ecstatic, irrational exuberance; people were buying near the top.Hope we get over that hill ($2.99) on results.

[sb9]

Op stats for Jul and fuel hedge disclosure...

https://nzx.com/companies/AIR/announcements/268787

https://nzx.com/companies/AIR/announcements/268788

[cdonald]

sb9, not up on hedges etc, what does the second announcment mean in regards to hedging fuel. thanks. chris

[sb9]

Me neither cdonald, sorry. Will leave it for experts to comment like Roger may be?

[Beagle]

Op stats for Jul and fuel hedge disclosure...

https://nzx.com/companies/AIR/announcements/268787

https://nzx.com/companies/AIR/announcements/268788

I am happy with July's operating stat's. With a slightly softer economy AIR's marketing team are doing a fine job of filling the planes. RPK's up 9% in a soft economy while maintaining yield's is no mean feat in this economy.


sb9, not up on hedges etc, what does the second announcment mean in regards to hedging fuel. thanks. chris

In a nutshell AIR's policy is to manage their fuel cost through the derivative markets. They do this using a variety of tools, futures options and collars. Collars are an instrument which as you can imagine tried to collar a certain amount of forward oil within a certain price range.

As you can imagine, seeing that the oil price has basically fallen to a 7 year low, AIR are out of the money, (a paper unrealised loss) on the mark to market value of all their derivative's , as are all airlines that forward cover part of their oil.
As at 14 August they were out of the money by $32m in total. While this seems a lot it needs to be kept in mind that they are contemporaneously enjoying the benefit of record low spot prices for fuel so the latter far outweighs the former.

Roughly speaking on average, over time you'll see that AIR tends to cover about half of their anticipated fuel needs through forward cover and uses spot prices for the other half. In a basic common sense way, this is simply a risk management tool to mitigate the effect of sudden movements in fuel prices over the foreseeable future.

Speaking with the CEO at last year's annual meeting, they're in the airline business, not fuel speculation business so they'll back themselves to be nimble enough to adapt to changing market dynamics rather than take big long term bets on the long term future direction of fuel.

Hope that helps explain the situation. If you go through the table in detail you'll see they break the year up into four quarters and disclose their position for each quarter and then mark to market their entire position at the foot of the page.

There's nothing in their fuel price hedging or July Operating stat's that concerns me. Well run business that's being run on a business as usual basis.

[sb9]

Thanks for that Roger

[tony64peter]

Most of AIR's profit soon to be released is from fuel.

[couta1]

Dump truck backed up on closing( Sold my GNE to do it) my plane will have to ditch some fuel to get off the ground now, hopefully we get a Spark type rise come next week, should be a cracker.

[KiwiGekko]

Dump truck backed up on closing( Sold my GNE to do it) my plane will have to ditch some fuel to get off the ground now, hopefully we get a Spark type rise come next week, should be a cracker.

A bump like Spark got today would be certainly be appreciated. :-)

I thought the AIR SP held up well today and am looking forward to Wednesday morning's announcement... Only 2 days of trading until we find out.

[couta1]

A bump like Spark got today would be certainly be appreciated. :-)

I thought the AIR SP held up well today and am looking forward to Wednesday morning's announcement... Only 2 days of trading until we find out.
Yep that would put it up near the $3 mark but depends whether it's an instant rise like Spark or a delayed reaction by a day or two.( I guess it all depends on their divvy guidance etc)

[Beagle]

Dump truck backed up on closing( Sold my GNE to do it) my plane will have to ditch some fuel to get off the ground now, hopefully we get a Spark type rise come next week, should be a cracker.

LOL you're a punter mate. The company has recently guided to a tight range of $520-$530m operating profit before tax and VAH's negative contribution so I'm not expecting any major divergence from that and you all know I'm the biggest AIR enthusiast on here. In my view the shares are very good value at the current circa $2.70 and the management are doing a superb job as are the marketing team in keeping the load factors strong in a slightly softer economy but I'm not expecting any major re-rating because of the result next week. Very good long term hold but I maintain a balanced and normal portfolio position. All the brokers at this stage are forecasting a drop off in profit in 2017...and I predict they'll all get egg on their face as oil stays lower for a lot longer than anyone's currently forecasting and AIR continue to generate cheap fuel enhanced profits. Long term I see low / mid $3 range but I would caution that plenty of patience will be required. Good fully imputed dividends means its easy to be patient.

[couta1]

Roger I think their result should produce a bigger lift in share price than GNE which I'm picking will be relatively uninspiring other than the divvy. PS- You right about the punting but you can't win if your not in aye.

[Beagle]

I LOVE to punt too mate but I find that if I take anything bigger than a 10% portfolio position in any one stock I start to worry too much so I've had to accept that a more balanced and diversified investment approach suits me better.

[couta1]

I LOVE to punt too mate but I find that if I take anything bigger than a 10% portfolio position in any one stock I start to worry too much so I've had to accept that a more balanced and diversified investment approach suits me better.
We're all different in our makeup mate, most of my stocks are under 10% except a few like Air / Diligent , and Spark which is my biggest holding at around 30% and at one point Sum made up 50% although I did get a bit nervous when I averaged down on Xro and it made up 15%, of my total:eek2:

[Beagle]

We're all different in our makeup mate, most of my stocks are under 10% except a few like Air / Diligent , and Spark which is my biggest holding at around 30% and at one point Sum made up 50% although I did get a bit nervous when I averaged down on Xro and it made up 15%, of my total:eek2:

You've been on Ashley Maddison with Norah at one stage haven't you :lol: Sorry mate, couldn't resist :D At one stage I had over 20% in AIR but I used to fret too much...life's too short..it wasn't good for my blood pressure.

[couta1]

You've been on Ashley Maddison with Norah at one stage haven't you :lol: Sorry mate, couldn't resist :D At one stage I had over 20% in AIR but I used to fret too much...life's too short..it wasn't good for my blood pressure.
Mums the word on Norah, yeah Air is a bit riskier than others to be overweight in with a bird falling turning everything to custard in short order. Wonder where Mod is these days ? he was extremely overweight in Air if I recall.

[Beagle]

Nobody's heard a peep from Mod for ages on any thread. I speculate he sold the lot when it tipped over $3.00 for a day or so a while back. The stock was in the 290's and Mod gave it a huge ramp and then he was gone... I think if he was here he'd be cautioning us on the lower $Kiwi currency impacting AIR's future overseas based opex and capex and then I'd be debating with him that its immaterial as half AIR's sales are to overseas punters in overseas currency.

[couta1]

Nobody's heard a peep from Mod for ages on any thread. I speculate he sold the lot when it tipped over $3.00 for a day or so a while back.
June 2nd was his last visit(Not post) so as you say possibly flew out of the Air coop a while back. PS- I think I've inherited his bar tab as I'm thinking of putting the icing on the cake by loading up just a few more on Monday.

[Beagle]

I think its prudent to be cautious in this market mate. From a global economic perspective, it appears we live in interesting times.

[Jay]

I thought Mod did literally fly away somewhere, thought I remember reading that on a thread (probably this one) sometime back.

[modandm]

Hi everyone.

I'm not around much, and given my new responsibilities at work I feel posting in these forums regularly has become inappropriate.

I haven't sold a single share, and am pleased with the way AIR is going.

While the strength of this years result is well expected, I expect stronger revenue growth than consensus for FY16 (less PRASM decline (loads/yields)). Partly because FX is now supporting yields - see the July stats. Although NZD weakness is a medium term negative for costs, the company have good hedging in place for the next 12 months. On top of this the oil price continues to weaken, and Virgin is set to improve next year. Lastly AIR has cost saving programs which should show a contribution next year.

In summary, consensus expects c.40c EPS next year, falling back to 30ish in FY17. I think c.50c is possible, falling to c.40c. There is no reason AIR can't sustainably earn 30-40cps into the medium term. Conditional on demand/fx/fuel (the usual). On top of this I feel the strength of balance sheet/competitive position/fleet/stake in VAH worth 40cps etc is not reflected in the share price.

I still think the company is worth $4.00 per share today, maybe $3.50 after a big special dividend in September 2016. Until then I we should continue to pick up nice divi's, on the way.

[IAK]

Great to hear from you Mod, always appreciate your contributions.

[Hoop]

I got asked about AIR's soon to be released report and problem to see signals on the charts...

I'm a little reluctant to post a chart on this AIR thread my recent sell signals off the $3 late May (a reason I started posting again) and the controversial September 2014 sell signals received some flack from the Fundies

This time the Chart shows no bad news....no great news either. The reason I got asked for my charting opinion was because AIR TA indicators didn't seem to be saying much and some were conflicting...
When a share price is trendless many indicators become less reliable and often TAers revert to oscillators to help out,,,,however AIR has presented a problem there too as the oscillators are showing neutral and aren't much help either..

We know the report will be positive but we don't know about the share price (is it factored in already?)..Well the Bollinger Bands are squeezed which indicates the answer is no, it's not factored in...
The good news is the investors are slowly accumulating (OBV rising). AIR is one of the few companies in the NZX50 that are still ahead of their primary uptrends and EMA200..

If the H&S pattern has failed then the very good news, is the gap territory around the 278 280 could come into play...area which could see a price accelerate back and reestablish itself into the middle of its old trading pattern range (2.70/3.00)

The not so good news is the sloping H&S pattern neck break..H&S patterns are reliable patterns, however the better news is that this is a shallow pattern and the target bottom is 2.50...Its broken its Primary trendline but thats not a biggee unless it falls further

I must admit I was surprised by the TA neutrality so close to its Wed 26th August FY announcement ...

Disc: hold no AIR

http://i458.photobucket.com/albums/qq306/Hoop_1/AIR%2021082015.png (http://s458.photobucket.com/user/Hoop_1/media/AIR%2021082015.png.html)

[Beagle]

Hey Hoop...when all else fails you need to revert to fundamental analysis. At $2.70 its trading on 6.59 times consensus FY16 earnings of 41 cps...super expensive eh :D

Nice to hear from you Mod....nothing to stopping you posting after hours. I think many people miss the vigorous debates you and I used to have.

[Hoop]

Hey Hoop...when all else fails you need to revert to fundamental analysis. At $2.70 its trading on 6.59 times consensus FY16 earnings of 41 cps...super expensive eh :D

Roger..This is probably not a good day to repost my chart illustration this being a black Monday and all that..but my repost shows how fundamental analysis failed for AIR back during the recession 2000 -2002..Air is a cyclical stock and cyclical stocks are risky beasts especially during weak economic times..I posted all this on the AIR thread on the 8th of May but my post has mysteriously disappeared which is very strange...

The chart illustration shows the share price and reports with brokers forecasts...notice how "cheap" the shares were with that excellent year 2000 result (profit up 54% but didn't beat brokers forecasts) and 2001 was forecast to be a huge year and yet TA sell signals appeared before the result and the downtrend continued for a year until capitulation..

The point I'm trying to make here is that results are historic by the time of release and the market which TA monitors is the "now" and forward looking....Prolonged downtrends or lack of price momentum during periods of good results and high future expections should be viewed as a caution especially with cyclical stocks.

http://i458.photobucket.com/albums/qq306/Hoop_1/AIR%20199-2001%20broker%20forecasts.png (http://s458.photobucket.com/user/Hoop_1/media/AIR%20199-2001%20broker%20forecasts.png.html)

[Beagle]

Fair enough Hoop but its perhaps worth noting there were specific concerns surrounding AIR at that time 2000/2001 in respect of its major investment in Ansett Australia. I think a more relevant period of time is the GFC when general consumer confidence was very weak.

My one concern regarding AIR is in regard to consumer demand. I note last week the latest consumer confidence survey came out and was at a 3 year low but interestingly in the second paragraph they talk about the "futures conditions index" being at a 6 1/2 year low. This index measures consumers perceptions of future economic conditions and is at its lowest level since the GFC. Probably not the most optimum time for AIR to be planning a 6% capacity expansion this year on top of last years 6% capacity expansion...I expect the marketing teams talent for creative demand stimulation will get a good workout this year.

To date the "Briscoes" a sale almost every week, or sometimes twice a week strategy seems to be paying off...I guess the risk is consumer "sale fatigue".
http://www.sharechat.co.nz/article/0dacd101/nz-consumer-confidence-declines-for-fourth-month-to-3-year-low.html?utm_medium=email&utm_campaign=NZ+consumer+confidence+declines+for+f ourth+month+to+3-year+low&utm_content=NZ+consumer+confidence+declines+for+fo urth+month+to+3-year+low+CID_6bfcf42039fd14a0c6d1e86dc9661f26&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticle0dacd101nz-consumer-confidence-declines-for-fourth-month-to-3-year-lowhtml

[sb9]

Thought AIR held quite well today considering the carnage across leader board, must be in anticipation of results prospects!!!

[vin]

Thought AIR held quite well today considering the carnage across leader board, must be in anticipation of results prospects!!!

Agreed, was just another day for AIR really. No movement that was out of the ordinary. Bring on results _b

[Beagle]

Held up surprisingly well considering the haircut some of its peers got.

[vin]

Tomorrow's results will be interesting.. Hanging out for it!

[Hoop]

I must admit I was surprised by the TA neutrality so close to its Wed 26th August FY announcement ...

Disc: hold no AIR


Thought AIR held quite well today considering the carnage across leader board, must be in anticipation of results prospects!!!

Agreed, was just another day for AIR really. No movement that was out of the ordinary. Bring on results _b

Today AIR has succumbed to the panic 255 -12 -4.5%...It has gone from a month of being blah (no reliable signals..neutral) close to its reporting date (tommorrow)... to triggering some more sell signals today...

One can blame the irrational Global crash and would probably hold on... but TA discipline blames no body or anything, just act on signals..

[tim23]

What sell signs every stock had that earlier today!

[couta1]

What sell signs every stock had that earlier today!
Exactly will probably hit $2.90-$3 within a fortnight I reckon so why sell? Disc-Bought more on open

[tim23]

Well done couta can't wait for result betting on bumper divvy and special

[Beagle]

Exactly will probably hit $2.90-$3 within a fortnight I reckon so why sell? Disc-Bought more on open

You're a laugh a minute mate...I hope you're right but realistically in this market ???

[couta1]

You're a laugh a minute mate...I hope you're right but realistically in this market ???
Okay Roger lets have your figure then!!

[tim23]

He bought them at open so under $2,60 the divided yield will be attractive we can assume hes not buying them to sell next week!

[Beagle]

Okay Roger lets have your figure then!!

As I said before mate the company very recently guided to $520-$530m profit before tax and before the contribution from VAH which will be a negative number this year. Seeing as this guidance was so recent and in such a tight range I'd be surprised if it was at much of a variation to what they said recently. The consensus EPS this year is about 30cps and for FY16 about 41 cps. Apply whatever PE you think is appropriate. If one takes the argument that they can earn 30 cps without the oil price tailwind at present, i.e. strip out the FY16 oil price tailwind of circa 11 cps then if we use the ten year average PE of 10 we get fair value of $3.00. I think that slightly undervalues the company, (my fair value is $3.30), but its not going to go roaring up to $3.00 later this week when the result has already been telegraphed into such a tight range. As I mentioned yesterday one of the key concerns is customers propensity in the current environment to commit to major travel expenditure, (forward consumer sentiment is at a low since the GFC) so this isn't the ideal environment into which the company is building capacity at 6% growth year on year. Clearly there is execution risk in their current growth strategy in these challenging times. The stock is undervalued but we live in interesting times so expectations of a rapid rise in altitude are probably unrealistic.

[couta1]

Thanks for your reply Roger, the amount of rise will IMO depend on the divvy amount and any special plus forward guidance on the same for next year as well as forward earnings guidance which goes without saying. I'm gonna stick with my price range though so lets see.

[Beagle]

Agreed mate its all about forward guidance now as the current year's result has all but been telegraphed already. Its a superbly managed company, there's no question about that and I have a lot of confidence they can navigate their way through any challanges they might encounter. Lately we've seen some innovative new marketing, (e.g. the Friday sunrise campaign), and inbound tourism is up 7% year on year and will grow with our weaker currency now its more reasonably priced to come to N.Z. again. That and they have a modern fuel efficient fleet and are prepared to make hard calls on inefficient aspects of their operation, (pending withdrawal of Beech 1900D's is an example of that), and oil is nearly as cheap as water, (cheaper than bottled water lol), so fingers crossed for a good result and onward and upward.

[sb9]

Think I share Roger's view on this one. I suspect the $3 mark quite far away now, unless something dramatic eventuates. Another 12 hours or so, all will be revealed.

[ddrone]

Here it is:

https://www.nzx.com/markets/NZSX/securities/AIR/announcements

[Master98]

results not surprised me, net profit 327m( 29cps), dividend 9.5cps, net debt doubled.

https://nzx.com/files/attachments/219363.pdf

[winner69]

Here it is:

https://www.nzx.com/markets/NZSX/securities/AIR/announcements

Good or bad drone

[percy]

Brilliant result..................

[Zaphod]

Yes, brilliant result. Well signalled and no surprises. Happy holder.

[Beagle]

First impressions
Normalised earnings of 496m up 49%...add equity accounted back $29m loss on VAH gives $525m, bang in the middle of the recent guidance range of $520-$530m. EPS of just over 29 cps.
Final dividend of 9.5 cps gives fully imputed divvy's of 16 cps gives a gross dividend return of 8.4% with plenty of growth to come.
Tony Carter and Chris Luxon confident of significant earnings growth in the coming year.
11% planned RPK growth in the coming year.
3 new Dreamliners in Q1 FY16, total 6.
24% extra capacity Auckland to Queenstown...that put a smile on my dial...maybe we finally get some cheap flights to Queenstown...(surely one of the most beautiful and interesting places in the world).

Happy holder...topped up some yesterday at $2.56.

[couta1]

Great result alright, all those extra Q/town flights both local and from Aussie should really kick in over the coming year, I mean even the upcoming Q/Town marathon is getting an extra 18 extra return flights alone to cater for race demand.PS-That was a sneaky top up Roger for a nervous guy like yourself.

[vin]

Very good! Stoked holder.

[tony64peter]

3 new Dreamliners in Q1 FY16, total 6.

Don't they have 6 at the end of this year, if another 3 then 9 in 2016??????

[777]

3 new Dreamliners in Q1 FY16, total 6.

Don't they have 6 at the end of this year, if another 3 then 9 in 2016??????

This year is FY2016

[couta1]

Initial market response quite muted apart from the open, perhaps overnight digestion of results required or maybe just nervous sellers exiting due to the current climate?

[Regi]

Initial market response quite muted apart from the open, perhaps overnight digestion of results required or maybe just nervous sellers exiting due to the current climate?
Agreed, it's a shame the results had to come out during these times. Even a couple of weeks ago would have been better.

[couta1]

Agreed, it's a shame the results had to come out during these times. Even a couple of weeks ago would have been better.
Seems Spark is the only safe haven at the moment, still up regardless of timing of results(Probably due to international investor influence)

[sb9]

Must be couta's affect, aye;)

I'm happy with the results and glad to collect fully imputed divvys, market at times can be bit irrational.

[IAK]

Results in line with expectations. Not sure that's enough given increasing competition and the reduced appetite for risk ATM.

[sb9]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11502602&ref=rss

Well, at least staff will be happy.

Happy people, happy corporate.

[tzbang]

9.5c fully imputed final divvy is nice. 16c in total..nothing to sneeze at imo

[theace]

Down to 2.59??? After a good announcement!

[vin]

Uncertain times, not surprised really.

[Beagle]

In no particular order
Cost per ASK down 5% to 10.5 cents $174m in operational savings due to fleet efficiencies.
Virgin expected to return to profit in FY16 (FY15 $29m loss)
Gearing target 45-55% currently 52% (That would be why no special divvy this year)
Very strong Operating cash flow $1.1 billion up (I think they said 50%)
$2.6 billion capex programme next four years 5 787-9's currently on hand as at today's date, 1 more due Q1 FY16 6 more in future years
8 new ATR's coming...the most efficient turboprop in the fleet
Young average fleet age, now 7.8 years forecast to decline to0 7.5 years and end of FY16
Commitment to get even more fighting fit
Digital transformation...aiming to be the leading airline in how they digitally interact with their customers
Growth FY16 11% overall, (mix is 8% domestic 15% international)
Advance sales to Housten and the new Bounses Aires, (sorry can't remember spelling of that city) going well
Efficiency drive centres around fleet simplification
All 747's gone, remaining 737's going in Sep 15
Beechcraft 1900's going
767 retirement programme commencing Mar 16
Simplification of fleet drives down costs, pilot costs spares e.t.c.
All A320 Jet fleet domestic and short haul
4 year $100m lounge upgrade program.
Airpoints membership up 17% including a 20% Australian increase...now 1.9 million members

Fuel - Current US Jet fuel $US60
Enjoyed fuel savings last year but based on current spot rates and forward cover there is a (this is HUGE), $293m efficiency gain to come in FY16 over and above the cost efficiency gains enjoyed in FY15.
Further...hedge losses of $70m less are expected, total fuel efficiency advantage at this stage based on current spot price and current forward cover on oil $363m !

Currency
92% hedged at an average rate of 77 cents
$80 pain in costs to come compared to last year based on current exchange rate taking into account above hedging..obviously this offsets some of the above mentioned $363m cost advantage.

Outlook
Christipher Luxon expects significant earnings growth in FY16. He really emphasised the word "significant" when he said that.

Consistency of Earnings
Company has been set up to operate profitably with $120 oil. C.L. emphasised we're running a business not an airline and we're looking to beat the historic cyclicality of earnings and adapt as we go.
Aiming for consistency of earnings.

Other comments in response to analyst questions.

Held ground on Tasman very well.
Not feeling slowdown like is in the media every day.
Feeling good about yield...some yield compression could be experienced as they grow the new routes to Housten and South America but advance bookings are going well

All parts of the network are profitable.
China, we've just had our best year ever.
Overall yields are good by industry standards.

In response to questions from Markus from UBS
Nominal decline in costs for Fy16 expected
Brief to op's team is to offset inflation increase.
New deal signed with union at 2% per annum locked in for 3 years...deal took 1 day to do, previously would have taken 3 months...free's up staff to work on growing the business rather than old traditional labour relations, sorry can't remember which union but I think you can take that deal as some sort of template.
Company expects profitable contribution from Housten and South American routes from day 1.

Apologies for lack on structure to this post...came straight off my messy notes taken from the call.

I welcome anyone's contribution if they listened to the call and I heard something a bit wrong, please feel more than free to express your viewpoint.

[fiasco]

Great result and what was to be expected. As much as I wanted to hold my shares, I think it's safe to say that the smartest decision given the macro activities is to withdraw and this morning was a good exit point.

I do hope I am wrong, but given my own personal circumstances it's not worth the risk.

Good luck to other holders, I do hope that this is a short correction and Air NZ blossoms!

[Joshuatree]

CEO on CNBC this morn. when asked about competition in NZ he said "bring it on". They've already been there done that and dealt to competition.Not buying or selling atp.I was lucky enough to buy in the $2.40's which gave me a comfortable margin of safety.Hope you folks who bought near the top re $2.99 when the thread was "euphoric" do well in the longer term.

[Beagle]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11502602

LOL this would have saved me a lot of typing
https://nzx.com/companies/AIR/announcements/269077

[Robomo]

You got it pretty well right Roger. Correlates with the bits I heard, in between phone calls.
The impression I got from CL is that he is really upbeat about the Company and how positive he was about next year.
I'm not selling, indeed if the SP drops a bit more (can't figure out why) I'll even buy a few more, even though I am already overweight on AIR

[Marilyn Munroe]

If you were an airline operator in the near-abroad who had over ordered new aircraft into a home patch demand slowdown or had old banger aircraft which become economic with low fuel prices would todays announcement from Cullen Airlines have got your attention?

Boop boop de do
Marilyn

[Beagle]

You got it pretty well right Roger. Correlates with the bits I heard, in between phone calls.
The impression I got from CL is that he is really upbeat about the Company and how positive he was about next year.
I'm not selling, indeed if the SP drops a bit more (can't figure out why) I'll even buy a few more, even though I am already overweight on AIR

Thanks Robomo. Yes CL really emphasised the word "significant" when he said significant earnings growth in the year ahead didn't he !

[Joshuatree]

CEO on CNBC this morn. when asked about competition in NZ he said "bring it on". They've already been there done that and dealt to competition.Not buying or selling atp.I was lucky enough to buy in the $2.40's which gave me a comfortable margin of safety.Hope you folks who bought near the top re $2.99 when the thread was "euphoric" do well in the longer term.

Couldn't be more confident than "BRING IT ON" either:t_up:

[Beagle]

Yeah, a handful or relic old Q300's they couldn't sell or give away coming into our market with the poor service standards Jetstar are known for and sardine-can like 29 inch pitch seating...I'm absolutely terrified... The valuable business clientele will be falling over themselves to clamber on board :lol:

Disappointing SP reaction to a great solid result and tremendous outlook today. Timing of the result couldn't have been worse with global macro events. Market can be a proper **** sometimes.

[Joshuatree]

Despite being an AIR shareholder; re jetstar ,I don't care where as long as they come here.:D Competition in Tauranga will bring the fares right down and about blimen time ;its been dawn till dusk robbery..

[Zaphod]

Despite being an AIR shareholder; re jetstar ,I don't care where as long as they come here.:D Competition in Tauranga will bring the fares right down and about blimen time ;its been dawn till dusk robbery..

TGA's PAX numbers are picking up, but are still relatively low compared to other airports so I suspect it will take some time for Jetstar to commit.

I suspect their services will be targeted towards AKL bound sectors. NSN, NPE, NPL, PMR, ROT etc. are the top contenders there IMO as AKL sector patronage is very strong especially with respect to the first three. Jetstar are reportidly pressing airports very hard for special deals on aeronautical charges, so that could sway them too. Essentially, the rate-payer could be creating a subsidy to allow Jetstar to charge lower fares.

[Beagle]

TGA's PAX numbers are picking up, but are still relatively low compared to other airports so I suspect it will take some time for Jetstar to commit.

I suspect their services will be targeted towards AKL bound sectors. NSN, NPE, NPL, PMR, ROT etc. are the top contenders there IMO as AKL sector patronage is very strong especially with respect to the first three. Jetstar are reportidly pressing airports very hard for special deals on aeronautical charges, so that could sway them too. Essentially, the rate-payer could be creating a subsidy to allow Jetstar to charge lower fares.

An interesting question that could well be worth asking at the forthcoming ASM is if Jetstar are getting special deals why aren't those same deals being offered to Air N.Z. ? I'd expect AIR would be lobbying regional councils that they as the incumbent player expect a level playing field and that N.Z. ratepayers should not be showing any favouritism to an Australian owned company. AIr are well and truly prepped to battle Jetstar on a level playing field basis but I'd be expecting AIR to take legal action against regional airports if there's more favourable terms handed out to Jetstar. Surely I am not the only one that can see an injunction coming if regional councils don't play fair. Council owned regional airports need to tell Jetstar these are the charges and if you don't like them feel free to take your old Q300's somewhere else.

[Leftfield]

Hear. Hear Roger

[Beagle]

I feel so strongly about this issue I sent the following e.mail to the appropriate channell at investor@airnz.co.nz

Hi Team,

Congratulations to the whole team on a superb year !! Keep up the excellent work.

I am writing to express my concern that I am hearing feedback that Jetstar are
lobbying regional airports for very special deals on landing charges in respect of their
pending regional route expansion.

I am concerned that as the incumbent operator AIR N.Z. could be disadvantaged if
they do not get the same special deals.

It strikes me as grossly unfair that Jetstar who have shown no previous support
towards regional airports might get a better deal on airport charges than the company
that has serviced and supported these airports all these years.

This would amount to a fundamentally tilted playing field and in effect ratepayers of
local councils who own the airport supporting an Australian owned company over a
New Zealand one.

This is a situation that as a shareholder I would find totally repugnant and I would
hope that AIr N.Z. management are lobbying regional airports to the effect that AIR
N.Z. expects a level playing field on charges.

Could it even be worth looking at an injunction against regional airports who see the
situation differently ?

I will follow up my concerns at the forthcoming ASM and hope to hear that AIR N.Z.
management are working hard on this issue.

Thank you again for your hard work.

[iceman]

An interesting question that could well be worth asking at the forthcoming ASM is if Jetstar are getting special deals why aren't those same deals being offered to Air N.Z. ? I'd expect AIR would be lobbying regional councils that they as the incumbent player expect a level playing field and that N.Z. ratepayers should not be showing any favouritism to an Australian owned company. AIr are well and truly prepped to battle Jetstar on a level playing field basis but I'd be expecting AIR to take legal action against regional airports if there's more favourable terms handed out to Jetstar. Surely I am not the only one that can see an injunction coming if regional councils don't play fair. Council owned regional airports need to tell Jetstar these are the charges and if you don't like them feel free to take your old Q300's somewhere else.

That´s a fair enough question Roger. But as a frequent user of Air NZ domestic flights to/from a regional airport with its ridculous fares, I celebrate competition on these routes. Origin Airways started flying quite a few routes between various regional and also some major domestic airports some years ago. Air NZ set out to destroy them by adding same routes to its schedule, often timed their flights at exactly the same departure times but with a lower price. Once they´d crushed Origin, they withdrew from many of those routes and schedules.
There was nothing level about that playing field !!! It is not healthy for Air NZ to monopolise our domestic regional travel and as an AIR shareholder and frequent flyer I welcome competition with open arms

[iceman]

Forgot to say that Air NZ has already annonced reduction in prices to and from my airport in Nelson. Jetstar has already done me a favour !!

[Master98]

AIR MA50 cross MA200 on 14/08 at 2.615, since then MA50 running below MA200,obviously the gap getting larger.

[winner69]

AIR MA50 cross MA200 on 14/08 at 2.615, since then MA50 running below MA200,obviously the gap getting larger.

Surely not a DEATH CROSS then

They are real bugger sometimes

The lines came close at 140 and again at 200 and lets say they close now at 260

Hey a natural progression going on here --- 140 plus 60 is 200 ---- plus 60 is 260 (say today) -- next step is plus 60 and 320

Love progressions like this. Usually pretty good they usually reach a point where it dont work anymore (like Heartland profitability)

[Beagle]

**** the technical analysis. I'm not selling. Gets much cheaper I double down.

[couta1]

**** the technical analysis. I'm not selling. Gets much cheaper I double down. Yep switch off TA mode and lock in FA mode for a smoother journey and reap the benefits of a great company with a stellar year ahead. The current price is just PLANE nutty after such a great result and outlook. PS- Spot the spelling mistake:cool:

[winner69]

**** the technical analysis. I'm not selling. Gets much cheaper I double down.

**** Technical Analysis with Fundamental Analysis along with a bit of Visualisation is the way to go

Pull up your 5 year AIR chart and look at the 50MA line bouncing off the 200MA every 60 cents on the way up - at 80 cents and at 140 cents and at 200 and with blurry glasses at 260 ....so visualise it doing it again at 320. That's the way to look at Technical Analysis

Fundamentals - absolutely stunning and fabulous

So keep buying Roger / Couta

But don't fall in love

And I'll stay out cause I couldn't live with a Dreamliner falling out of the sky and killing hundreds of people knowing I caused it

[Joshuatree]

**** the technical analysis. I'm not selling. Gets much cheaper I double down.

Think carefully folks about following jolly roger; remember the heavy promoting he did in the $2.90's along with the excellent research.People are still in the red.Make your own investment decisions in these tricky times . We have had a golden few years but as the nz supperannuaition fund review said expect less ahead.

[Beagle]

That´s a fair enough question Roger. But as a frequent user of Air NZ domestic flights to/from a regional airport with its ridculous fares, I celebrate competition on these routes. Origin Airways started flying quite a few routes between various regional and also some major domestic airports some years ago. Air NZ set out to destroy them by adding same routes to its schedule, often timed their flights at exactly the same departure times but with a lower price. Once they´d crushed Origin, they withdrew from many of those routes and schedules.
There was nothing level about that playing field !!! It is not healthy for Air NZ to monopolise our domestic regional travel and as an AIR shareholder and frequent flyer I welcome competition with open arms


Forgot to say that Air NZ has already annonced reduction in prices to and from my airport in Nelson. Jetstar has already done me a favour !!

Hi Iceman,

I'm a little surprised by your response as I was pretty sure as a frequent flyer you'd understand you get what you pay for.
Air offers a modern fleet, (average age under 8 years), frequency of service, inflight snacks, decent sized seats and prices if you book ahead are fairly reasonable.
Sure if you have to fly tomorrow it costs more but the thing is mate, there's usually a seat there at a time that suits.
Earlier this month I flew AKL to Napier. I booked two weeks ahead and it was $55 per sector. I fought through 1 hour of traffic to get there on time and sweated blood I'd miss the flight and had to pay $39 for six hours uncovered parking at Auckland airport. You tell me which parts of that day annoyed me ! I have seen plenty of flights AKL to Nelson on special for $65, what's wrong with that ?


OTOH Jetstar's regional offer will be using very old Q300's with incredibly tight 29 inch pitch seats that will literally kneecap anyone over 6ft, less frequent flight scheduling, no free inflight snacks, often overseas trained pilots, (the Jetstar flight I was on last year was a Chinese pilot that couldn't land the plane on first attempt at the full length Christchurch airport on a beautiful fine, windless and clear morning) and they expect local ratepayer owned airports to subsidise their operations with cheaper landing fees. In the words of the cute kid in the Mitre Ten advertisement...tell em they're dreaming maaatte.

I liken air travel to any other form of travel, its a fundamental safety issue to me. When I'm landing at Wellington's airport and its blowing 50 knots of wind, I want to know the pilots up front are extremely well trained Air New Zealanders committed to the very best and most rigorous training processes and are flying the most modern fleet.
For the same reason we as a family own modern late model vehicles with all the latest safety technology and equipment. I wouldn't put my family in a 20 year old Japanese import done 300,000 km's without all the latest safety gear like DSC ABS EBD, multiple air bags and so on, would you ? You know from your job that as equipment, machinery and systems age they become considerably less reliable, (I know this too from years of owning launch boats with multiple engines and complicated systems), so why fly in 20 year old aircraft and support an Australian owned company just to save a few bucks ?
When something goes seriously wrong in a 20 year old plane you can't just call the Coast Guard can you ?


Yep switch off TA mode and lock in FA mode for a smoother journey and reap the benefits of a great company with a stellar year ahead. The current price is just PLANE nutty after such a great result and outlook. PS- Spot the spelling mistake:cool:

Isn't that the PLANE truth. Well said mate.


**** Technical Analysis with Fundamental Analysis along with a bit of Visualisation is the way to go

Pull up your 5 year AIR chart and look at the 50MA line bouncing off the 200MA every 60 cents on the way up - at 80 cents and at 140 cents and at 200 and with blurry glasses at 260 ....so visualise it doing it again at 320. That's the way to look at Technical Analysis

Fundamentals - absolutely stunning and fabulous
So keep buying Roger / Couta

But don't fall in love

And I'll stay out cause I couldn't live with a Dreamliner falling out of the sky and killing hundreds of people knowing I caused it

Couldn't agree more.


Think carefully folks about following jolly roger; remember the heavy promoting he did in the $2.90's along with the excellent research.People are still in the red.Make your own investment decisions in these tricky times . We have had a golden few years but as the nz supperannuaition fund review said expect less ahead.

For the record quite a number of people have thanked me profusely by PM for my research on AIR, many of whom got in under $2.00 and have enjoyed tremendous dividends including last year's special. I call things as I see them. The stock is worth more and people need to be patient to get more as I have said several times. In the meantime they are enjoying circa 8.5% gross dividend yield so people can afford to be patient can't they !! Its very disingenuous for you to pick on one point in the company's SP history, in my view.
Airlines have specific risks and have traditionally been a more volatile stock to own than average, (i.e. high Beta) If people don't understand this they are better off not investing in this high quality and extremely well managed company notwithstanding that its trading on extremely compelling fundamental's.

[winner69]

Roger, you need to empty your mail box

Probably full of enraged AIR investors who bought at 290 plus venting their fury on you.

[Beagle]

^^ LOL mate. Nobody complaining. Almost everyone appreciates my knowledge and research on AIR but there's always the "odd" exception.

[sb9]

^^ LOL mate. Nobody complaining. Almost everyone appreciates my knowledge and research on AIR but there's always the "odd" exception.

Always appreciate your input Roger, keep it coming....

[Plutus]

AIR. credit where its due.

[Hoop]

**** the technical analysis. I'm not selling. Gets much cheaper I double down.

But Roger ...
You **** the TA when it fired a mass of sell signals 11 weeks ago at 270 when a bearish double top pattern was formed using TA (charting) discipline.

You dismissed TA (indicators) discipline when they showed bearish divergences around the $3 level 4 months ago..

You dismissed the long term TA (harmonic) discipline when it showed a possible bat formation warning 6 months ago..and later confirmed that AIR is a cyclical stock and is still behaving as one.


OK its a fundamentally great company at the moment but a lot of different disciplines told you to sell after it failed to go higher..You elected not to sell...OK it's your choice and in doing so you decided to except the good with the bad...It seems you are not excepting the bad too well at this moment..by electing to do an averaging down on a down trending stock

Using TA discipline does more for an investor than just time buy or sell......
1....It is an insurance policy to reduce capital loss and risk....If mass sell signal fail you simply buy back in usually at the same price or slightly higher..I treat that fail as an insurance policy fee.....Usually mass sell signals don't fail and the exited investor now waits until the bearishness has played out and reaps opportunity gain (more shares than before for the same original capital outlay..better divvys)... or in very very rare times thank their lucky stars they did get out in time.
2....TA forces the investor to exit the share...and in doing so prevents the investor from making bad emotional decisions which could further compound their problem....e.g averaging down...
3....TA makes you sleep better ...because often when you don't sell on the signals you get anxious seeing Stock weakness continuing and a time comes when you are presented with a hold/sell dilemmna problem which you can not mentally solve.. you are stuck with 2 choices either which could be right or wrong...TA discipline eliminates this investors emotional " sell the price goes up.. buy the price goes down" dilemma

At this moment.. Medium term (default) TA says don't enter (or average down) ...More sell signals have fired....

[couta1]

JT I sold my SCL on your storm warning a few months ago having bought at $1.36 so I won't be following your advice on Air- Lol

[Beagle]

Yeah and I followed his advice and sold my AIR at the height of the Ebola scare at under $1.80 and it cost me nearly 20 cents more to get back in. For the record Hoop, I do value your input and put a good value on TA but my core I am a FA guy so will always buy exceptional value when I see it.

I really don't care if it goes lower. Happy to buy into any further significant weakness.

[ddrone]

Touching 2.50. Where to from here?

[Hoop]

Yeah and I followed his advice and sold my AIR at the height of the Ebola scare at under $1.80 and it cost me nearly 20 cents more to get back in. For the record Hoop, I do value your input and put a good value on TA but my core I am a FA guy so will always buy exceptional value when I see it.

I really don't care if it goes lower. Happy to buy into any further significant weakness.

Fair enough Roger I used to be a long term FA investor (1973 - 1998).. I know where you are coming from, as I have a FA core too...That also means I enjoy your excellent posts:cool:.

When investment disciplines diverge its always pays to be aware of it happening. Its more tools for your decision making...As Winner wrote ...Technical Analysis with Fundamental Analysis along with a bit of Visualisation is the way to go...
I agree but would be careful about the visualisation bit though..sometimes they are mirages :p

[arc]

The problem with buying for the div's at the moment is that the market is falling faster than the amount the div will return. And then the price will drop after div date, and the market will still be falling.... loss compounded on top of loss..

[Hoop]

Touching 2.50. Where to from here?

Getting close to the sloping H&S pattern break target area (~245)....so for me AIR goes onto my watchlist

[Beagle]

Fair enough Roger I used to be a long term FA investor (1973 - 1998).. I know where you are coming from, as I have a FA core too...That also means I enjoy your excellent posts:cool:.

When investment disciplines diverge its always pays to be aware of it happening. Its more tools for your decision making...As Winner wrote ...Technical Analysis with Fundamental Analysis along with a bit of Visualisation is the way to go...
I agree but would be careful about the visualisation bit though..sometimes they are mirages :p

Absolutely I definitely feel more comfortable when FA and TA are both in harmony with each other and pointing in the same direction. Visualisation is bloody difficult in this market but I must say the CEO and CFO sounded extremely confident on the call about how FY16 will play out. I always appreciate your input mate.

I'm not going to speculate ddrone on the short term price direction. As Hoop mentioned the technicals look weak at this time but the fundamentals are extremely compelling. Its perplexing but I won't lose any sleep over it as I'm still happy to sit on just under a 10% portfolio position and bide my time too pounce if the price gets too stupid.

[winner69]

Analysts seem to be bit downbeat on AIR
http://www.sharechat.co.nz/article/ef9fe9f6/air-nz-shares-fall-analysts-query-capital-return-strategy.html?utm_medium=email&utm_campaign=Air+NZ+shares+fall+analysts+query+cap ital+return+strategy&utm_content=Air+NZ+shares+fall+analysts+query+capi tal+return+strategy+CID_bef2013add8ec6ef2a57dd10f7 5ed8a4&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticleef9fe9f6air-nz-shares-fall-analysts-query-capital-return-strategyhtml

Mention no special dividend has upset some.

[winner69]

One thing Mo said was the higher AIRs profit the lower the PE goes. Valued by the market on a over the cycle basis or something like that.

If mo is right and analysts are right about super profits in 2016 we probably will still see a shareprice under 3 bucks this time next year. How much under is the unknown

[Yoda]

Yeah and I followed his advice and sold my AIR at the height of the Ebola scare at under $1.80 and it cost me nearly 20 cents more to get back in. For the record Hoop, I do value your input and put a good value on TA but my core I am a FA guy so will always buy exceptional value when I see it.

I really don't care if it goes lower. Happy to buy into any further significant weakness.
Im interested to note that some people just seem to have spare cash to just "buy some more" when the price is right .
is it part of your strategy to sell some other stock when high and keep some cash reserves at all times ... 10 % .?

[Beagle]

Analysts seem to be bit downbeat on AIR
http://www.sharechat.co.nz/article/ef9fe9f6/air-nz-shares-fall-analysts-query-capital-return-strategy.html?utm_medium=email&utm_campaign=Air+NZ+shares+fall+analysts+query+cap ital+return+strategy&utm_content=Air+NZ+shares+fall+analysts+query+capi tal+return+strategy+CID_bef2013add8ec6ef2a57dd10f7 5ed8a4&utm_source=Email%20marketing%20software&utm_term=httpwwwsharechatconzarticleef9fe9f6air-nz-shares-fall-analysts-query-capital-return-strategyhtml

Mention no special dividend has upset some.

I listened to all those analysts questions and AIR's answers during the conference call. AIR more upbeat than the analysts are recognising. I reckon some of them are off-beam picking a big slide in profit in FY18. Lets get real here, not a single one those analysts can predict with any degree of reliability at this stage what the profit will be in FY17 let alone FY18.

I picked up on an undertone of slight frustration CL has with analysts insistence this is a cyclical stock. Bottom line in my opinion is this company is running like a well oiled Swiss watch, FY16 consensus EPS is now up to 44 cps, (previously 41 cents) which puts AIR on a FY16 PE of 5.7 !! (against a historical 10 year average of 10).
Cash flow last year was nearly $1 per share ! Consensus fair value, (after broker revisions), is now $2.91.

Yoda, when stocks reach compelling price points I make it my business to ensure I'm liquid.

[couta1]

Well i'm fully loaded now after topping up big time at $2.53( Fell a few cents more but that's life) My average is now $2.57 for over 180k shares (I won't say what percentage of my portfolio that is as it may frighten some even Roger) IMHO the current price is completely irrational and has come about through a mix of things like plain fear/the shepple effect/stop losses being hit etc etc ,will become oversold soon ( If not already) so expecting a bounce and of course there's that nice fully imputed divvy which is on a par with the Spark divvy. Anyway I reckon there's a lot of upside in this share, that's my story and I'm sticking to it.

[Master98]

Well i'm fully loaded now after topping up big time at $2.53( Fell a few cents more but that's life) My average is now $2.57 for over 180k shares (I won't say what percentage of my portfolio that is as it may frighten some even Roger) IMHO the current price is completely irrational and has come about through a mix of things like plain fear/the shepple effect/stop losses being hit etc etc ,will become oversold soon ( If not already) so expecting a bounce and of course there's that nice fully imputed divvy which is on a par with the Spark divvy. Anyway I reckon there's a lot of upside in this share, that's my story and I'm sticking to it.
lol, hopefully you didn't sell SPK:scared: to fund AIR:confused:

[couta1]

lol, hopefully you didn't sell SPK:scared: to fund AIR:confused:
Why settle for one divvy when you can grab two if you play your cards right, got heaps of Air still Master?

[Master98]

Why settle for one divvy when you can grab two if you play your cards right, got heaps of Air still Master?

was 50k shares SPK at 3.1, then bought another 50k shares SPK at 2.7 in the dip, sold AIR on the announcement day at 2.7 as the results not surprised me.

[Beagle]

Well i'm fully loaded now after topping up big time at $2.53( Fell a few cents more but that's life) My average is now $2.57 for over 180k shares (I won't say what percentage of my portfolio that is as it may frighten some even Roger) IMHO the current price is completely irrational and has come about through a mix of things like plain fear/the shepple effect/stop losses being hit etc etc ,will become oversold soon ( If not already) so expecting a bounce and of course there's that nice fully imputed divvy which is on a par with the Spark divvy. Anyway I reckon there's a lot of upside in this share, that's my story and I'm sticking to it.

Crikey you've got a pair I'll give you that. In terms of me backing my truck up, I haven't used my truck for quite a while but I changed the oil today and made sure the reverse gear works, (so too speak).
I take a lot of comfort from the aircraft loadings throughout FY15 staying strong at 84.1% even though for much of FY15 the economy wasn't nearly as strong as in FY14, (recall Dairy was over $8 in FY14 !). Further, demand actually grew in FY15 a materially less assistive economic environment in line with AIR putting on 6 % extra capacity ! You folks want evidence that AIR's marketing team can fill extra capacity ?, look no further than last year as a prime example.

As Christopher Luxon tried to explain to the doubting Thomas analysts during the call, inbound tourism is up 7% and tourists are staying for longer, travelling around here more and spending more while they're here. C.L. is very confident the new Houston and South America routes will be profitable from day 1. There's 30 million Americans in the southwest that gives a large catchment area and most of them think that flying here is a forty hour journey. Further, Houston is United airlines, (Star Alliance partner) equal #1 hub so hassle free connections onwards throughout southern and eastern states are easy and convenient. Five flight s a week from day 1 and good forward demand is being experienced.

I also take comfort from forward sales at balance date FY15 comfortably exceeding those at the same time last year.

I do believe that analysts are human beings, (as a professional myself I acknowledge its hard to stay truly objective in times of extreme pressure, almost duress) and they can't help but be impacted by this weeks dramatic events in the international markets. The timing of the result was most unfortunate as was the environment in which those analysts reworked their numbers. Interestingly some have quietly made significant upgrades to FY17 estimates on what were very pessimistic estimates before that. I reiterate that you can take analysts FY17 and FY18 estimates with a grain of salt...they have very little clarity on what conditions will be like in those years this far out. Just listen to what the company is telling you about FY16.

[couta1]

Maybe those analysts fail to take into account that tourism is humming and is set to overtake dairy as an earner within a couple of years, well positioned comes to mind. (Perhaps those analysts should spend a week in Q/town right about now to blow the cobwebs from their thinking)

[Beagle]

Maybe those analysts fail to take into account that tourism is humming and is set to overtake dairy as an earner within a couple of years, well positioned comes to mind. (Perhaps those analysts should spend a week in Q/town right about now to blow the cobwebs from their thinking)

Couldn't agree more mate. We could give them a guided tour for a small charge :D Mate you've set the bar pretty high with that shareholding stake of yours !
Just keep your seat belt firmly fastened for the next 2 or 3 weeks. Hopefully there should be smoother flying conditions after that.

[couta1]

Couldn't agree more mate. We could give them a guided tour for a small charge :D Mate you've set the bar pretty high with that shareholding stake of yours !
Yeah I'm all or nothing if I like something and feel proud of this well run NZ owned business( Why give money to Australia?) I like to be transparent about my holdings also, happy for others to know where I stand whether they agree or not.

[Beagle]

Yeah I'm all or nothing if I like something and feel proud of this well run NZ owned business( Why give money to Australia?) I like to be transparent about my holdings also, happy for others to know where I stand whether they agree or not.

Good on you mate.

[blockhead]

Left an order in @ $2.51 for the last few days, didn't have a chance to check through the day and was surprised to see the order was filled, lets hope that's the bottom and we get back to discussions about when $3 will be breached again !
Div is too good to leave on the table I figure.

[Robomo]

Well, the overwhelming opinion, including mine, about AirNZ on this forum is that everything is looking extremely good and that this correlates with the majority of airlines worldwide who are reporting record profits. However that hasn't stopped lots of people willing to sell AirNZ for an ever decreasing price, presumably on the threat of 5 old Qantas Q300's and more international competition from assorted airlines.

What I would like to know is....what is the mindset of those who are selling?

[winner69]

What I would like to know is....what is the mindset of those who are selling?

Probably see it as fully valued, even taking into account the bright prospects ahead

Rogers long term average PE of 10 is a bit misleading. When AIR goes through tough times h PE is high teens when when making plenty the PE drops to 7 and sonetimes below. The market sees earnings cyclical so value it on a sort of mid cycle basis - that's where it s now.

Interestingly AIRs PE ratio is generally 50% to 60% of the market PE

Until the market changes it views I fear that's how it is going to be I reckon.

[couta1]

Robomo I reckon it's mainly the Shepple effect and analysts making haphazard guesses about 2-3 years from now is just crystal ball gazing but many of the sheep give these analysts a lot of kudos (I Don't) Things can change for any company over a year let alone further out than that but Air has to be in the best position currently it has ever been in and the ducks are all lined up. Competition from Jetstar is just a side issue and of little significance to AIR IMO, anyway looks near to or already oversold going by some basic indicators like RSI and W%R and with the divvy going Ex in just over a week should be bounce time soon.

[Beagle]

Probably see it as fully valued, even taking into account the bright prospects ahead

Rogers long term average PE of 10 is a bit misleading. When AIR goes through tough times h PE is high teens when when making plenty the PE drops to 7 and sonetimes below. The market sees earnings cyclical so value it on a sort of mid cycle basis - that's where it s now.

Interestingly AIRs PE ratio is generally 50% to 60% of the market PE

Until the market changes it views I fear that's how it is going to be I reckon.

That's fair comment mate. Couple of things though.
Firstly PE expansion. Interest rates are heading to 50 year lows so that's supportive of some general market PE expansion, certainly the market generally has expanded its PE, so as I've mentioned before you could easily argue that the average PE should move to 11 or perhaps 12.

Secondly, while I accept the general thrust of what you're saying if you take into account the stock trades cum a 9.5 cent fully imputed divvy due in five minutes time, (so too speak) and look through that, in effect it closed on Friday at $2.40 on an ex div basis. Consensus analyst forecast is now 44cps so the consensus FY16 PE is only 5.45, or more correctly would be that if the stock trades at $2.40 when it goes ex in early Sept. I don't think AIR's PE has ever been that low.

Robomo - In addition to the matters you outlined the only way I can figure this is it must be general gloom and doom over the N.Z. economic outlook and world economic growth concerns...that's the only thing that would explain the current SP...and yet for much of FY15 the economy was far from robust yet they still filled the extra 6% seat capacity. Go figure ?

[winner69]

PE was between 5 and 6 during 2008/2009. (Eps was 21 cents in 2008 at the peak of that cycle)

[winner69]

What I would like to know is....what is the mindset of those who are selling?

Maybe it was that Death Cross on the chart that scared them off?

[Valuegrowth]

There could be different reasons for share prices drop in AIR NZ



It may by due to personal reasons
It may be to raise funds to buy another attractive investment
It may be due to doubt about the airline's ability to make attractive profits over the next two years as economic activity weakens and competition increases.


Only positive news for airlines is lower oil prices. Despite lower oil prices we didn’t see drop in prices of air tickets. The global airline industry is set to face more aggressive competition in the coming year.

Airlines were able to maintain profit mainly by cutting costs thanks to lower oil and other raw materials. We could expect more volatility in this stock in the coming months.

[KiwiGekko]

What I would like to know is....what is the mindset of those who are selling?

I sold my AIR on Friday at the open ($2.53), after watching 2 days (and Friday a 3rd after I sold) of it going slightly higher at the open (I'm guessing retail investors are buying at the open trying to catch the bottom) and closing lower. - Couta probably bought a few of mine... Good luck with them mate. :-)

I believe AIR is a fantastic company and is running as a well oiled machine, but they do face some fairly decent headwinds for FY16 and the market seems to have turned extremely conservative recently.

My reasons for selling (in order of importance) are:

1) The Technicals on this stock are not good. AIR's SP is falling quite quickly against the market trend after a record profit announcement and some very impressive growth figures. The way this is happening is quite unsettling and does not make a whole lot of sense to me and if I don't understand *why* a stock is behaving a way generally speaking that's a good time to get out.
2) I reached my bottom number - I simply want to preserve capital and when things are not so rocky I will come back.
3) AIR face some fairly decent headwinds filling the extra capacity they have coming on with a very uncertain economic climate.
4) There is increased competition and lower oil prices do cause other airlines to enter the market, I am not concerned about the domestic competition, but the international routes is worth acknowledging.
5) Globally confidence levels seem to be down, does this impact levels of travelling / tourism? I don't know, but see #1 - I don't think anyone can predict how this last couple of weeks (months?) of this "correction" are going to play out.
6) I potentially have another use for these funds in the near future.

So I am out, I have taken a small loss on this last trade, but that is life & I am sleeping better for it. I hope its the bottom for the holders and stand ready for when things are looking a bit more positive again & we have a bit more data to show us what is happening in the market. Hopefully that helps explain my reasons for selling, I look forward to a good debate and seeing how the future proves me wrong or right here.

[Beagle]

AIR an interesting high yield story now too. Current year 16 cps fully imputed = 22.22cps gross = just on 9% gross and you get the 9.5 cent final very shortly as a nice bonus on top of that.

AIR were asked by analysts during the call for their dividend policy and CL said they don't have a specific policy per se, its a call they make at each half year juncture so this is pure speculation but if we assume this year's pattern of paying 16 cps out of 29 cps is normal year that represents a dividend pay-out ratio of 55%. Looking at consensus analyst earnings estimates for FY16 and Fy17 and averaging those we get prospective earnings of in total 81cps over the next two years which would speculatively give fully imputed dividends of 44.5 cps, gross dividends of 61.8cps, (44.5 / 0.72) so on average gross dividends of 30.9 cps per year. Based on Fridays close this gives a theoretical ex divvy price of $2.40 so investors buying this for yield could speculate that they'll be looking at annual gross returns of 30.9 cps on their investment of $2.40 or a gross yield of 12.9%. If someone were looking at a geared situation and borrowing at say 4.69% on their mortgage, (I am not suggesting this but this is what people do with rental properties every day of the week), clearly this investment is highly likely to be self funding with plenty of net return.

Suppose one invested an average Auckland house value of $800,000 in AIR shares they might speculatively expect annual gross income of $103,200 from their AIR shares or from the 101 sets of rental property financial statements I've done they might speculatively net, (after expenses, but still taxable) about $15,000 - $20,000 in rent after all expenses...assuming the tenant didn't turn the place into a P Lab and assuming they paid rent all year. (Neither of these assumptions are a given by any means). Of course if you have meaningful debt on said property expect to be putting your hand in your own pocket over and over again to fund the property...unlike the happy AIR shareholder who will be enjoying lucrative positive cash flow returns.

Fundamentally its pretty obvious which investment is better underwritten by the real cash returns being received.

The reason I provide this apparently obscure comparison is you'd be surprised how many times a suburban accountant is asked if investing in a rental property is a good idea. This usually goes something like this, There's nothing safer than bricks and mortar right ?

So...here is my contention... is our dear friend Couta1 crazy in having a XXXXL bet on AIR crazy or are people buying an Auckland rental property after many years of explosive growth already factored into the price and with such relatively pitiful net rental returns the true nutty ones ?...you be the judge !

Anyway back to more relevant comparisons. I believe the prospective yield puts it towards the very top of the NZX yield table and remember that's paying out only 55% of earnings not close to 100% like many of the other comparative high yielding stocks do.

[winner69]

AIR an interesting high yield story now too. Current year 16 cps fully imputed = 22.22cps gross = just on 9% gross and you get the 9.5 cent final very shortly as a nice bonus on top of that.

AIR were asked by analysts during the call for their dividend policy and CL said they don't have a specific policy per se, its a call they make at each half year juncture so this is pure speculation but if we assume this year's pattern of paying 16 cps out of 29 cps is normal year that represents a dividend pay-out ratio of 55%. Looking at consensus analyst earnings estimates for FY16 and Fy17 and averaging those we get prospective warnings of in total 81cps over the next two years which would speculatively give fully imputed dividends of 44.5 cps, gross dividends of 61.8cps, so on average gross dividends of 30.9 cps per year. Based on Fridays close this gives a theoretical ex divvy price of $2.40 so investors buying this for yield could speculate that they'll be looking at annual gross returns of 30.9 cps on their investment of $2.40 or a gross yield of 12.9%.

Suppose one invested an average Auckland house value of $800,000 in AIR shares they might speculatively expect annual gross income of $103,200 from their AIR shares or from the 101 sets of rental property financial statements I've done they might speculatively net, (after expenses, but still taxable) about $15,000 - $20,000 in rent after all expenses...assuming the tenant didn't turn the place into a P Lab and assuming they paid rent all year. (Neither of these assumptions are a given by any means).

Fundamentally its pretty obvious which investment is better underwritten by the real cash returns being received.

The reason I provide this apparently obscure comparison is you'd be surprised how many times a suburban accountant is asked if investing in a rental property is a good idea.

So is our dear friend Couta1 crazy in having a big, big bet on AIR or are people buying an Auckland rental property after many years of explosive growth already factored into the price and with such relatively pitiful net rental returns the real nutty ones...you be the judge !

P labs ....plane crash ...hmmyh

[Beagle]

P labs ....plane crash ...hmmyh

No investment is risk free mate.

[voltage]

Good points Roger. $800000 in AIR gives a lot of specific risk compared to a rental. But the figures speak for themselves. You are expecting a lot of capital gain in the rental to justify the low dividend yield. However, I do like the comparison with AIR. Perhaps a basket of top dividend shares would be the way to go.

[Beagle]

Good points Roger. $800000 in AIR gives a lot of specific risk compared to a rental. But the figures speak for themselves. You are expecting a lot of capital gain in the rental to justify the low dividend yield. However, I do like the comparison with AIR. Perhaps a basket of top dividend shares would be the way to go.

Yes to be clear, its definitely a lower risk approach having a well diversified portfolio...the post was merely for illustrative purposes as I am sure you and others understood.

Well Jetstar are set to announce their 4 regional destinations this morning. I think you will be pleased Iceman...Nelson a shoe-in I would have thought.

[iceman]

Well Jetstar are set to announce their 4 regional destinations this morning. I think you will be pleased Iceman...Nelson a shoe-in I would have thought.

Yes Roger. Nelson, New Plymouth, Napier and Palmie it is, with Nelson getting both Wellington and Auckland flights. I am very pleased with this as I am sure all of Nelson and the other towns/cities are. I suspect I will keep flying mainly AIR, but at much lower fares. Competition was needed with AIR, now we have it. Great news.

[Beagle]

Yes Roger. Nelson, New Plymouth, Napier and Palmie it is, with Nelson getting both Wellington and Auckland flights. I am very pleased with this as I am sure all of Nelson and the other towns/cities are. I suspect I will keep flying mainly AIR, but at much lower fares. Competition was needed with AIR, now we have it. Great news.

Well if you do fly Jetstar mate just remember when you get on an aging old Q300 Jetstar couldn't sell or give away, that 20 year old plane flown possibly by a Chinese trained pilot with its sardine can 29 inch pitch seats...you get what you pay for mate and remember what I told you by e.mail about 20 year old cars. Stay safe or stay home I reckon :) You won't catch me on a clapped out old Jetstar plane EVER !!

[couta1]

I like the bit in the Herald article where Mr Luxton says this Jetstar entry has been a bit overblow(Sure has) Also the bit by the Jetstar guy saying they were not looking to take a slice of the existing pie by entering these routes but rather to cater for growth( He will be hoping that growth is enough to justify the expansion or it will be goodbye within 3 years)

[Beagle]

Oh...COME ON ...everyone is supposed to panic and SELL now that the mighty Jetstar are flying regional routes...I've had the truck warming up all morning :D

[couta1]

Oh...COME ON ...everyone is supposed to panic and SELL now that the mighty Jetstar are flying regional routes...I've had the truck warming up all morning :D
Roger I think you should have backed it up on Friday but there may still be a few shepple left to be unsettled by this stunning news from jetstar:eek2:

[tzbang]

Looks like a real bargain to me. I wish I had a truck.. I'm standing by my bicycle with the basket on the front and if there is going to be a final scramble I'm going to get some handfuls.

[Jay]

I think someone mentioned before, it is more likely to increase the number of people flying than necessarily taking passengers from AIR - both will benefit.

[Robomo]

Jetstar competition

The market has spoken. AirNZ SP has rocketed up 0.4% (1 cent). That'll show 'em.

[winner69]

Stuff says

Jetstar site CRASHES

Very popular

[couta1]

Stuff says

Jetstar site CRASHES

Very popular
Very popular and off to running at a loss with their intro prices, mind you that Jetstar website is a dog anyway so not surprised.

[sb9]

Today's announcement by Jetstar reminds of Shake spear's popular comic "Much ado about nothing"...

Let's move on...

[vin]

Their announcement will fizzle in a day or 2

[Regi]

Up 6 cents so far... Thanks JetStar, keep reminding us how rubbish you are please :t_up:

Still got a wee way to go though...

[sb9]

Oh...COME ON ...everyone is supposed to panic and SELL now that the mighty Jetstar are flying regional routes...I've had the truck warming up all morning :D

You may park the truck for now Roger....

[Beagle]

You may park the truck for now Roger....

https://www.youtube.com/watch?v=6RfAYnCxkK0

[couta1]

Friday was back up the truck day, today is take the very overweight truck to the aircraft hanger and park it up while waiting for a mother of a divvy next week.

[Beagle]

Friday was back up the truck day, today is take the very overweight truck to the aircraft hanger and park it up while waiting for a mother of a divvy next week.

On ya mate. I thought you'd gone hard a little early but this is shaping up as your best play ever !! I hope you don't mind but I am praying for some more turbulence later this week.. shake a few more Muppets out at under $2.50.

[couta1]

On ya mate. I thought you'd gone hard a little early but this is shaping up as your best play ever !! I hope you don't mind but I am praying for some more turbulence later this week.. shake a few more Muppets out at under $2.50.
No worries mate and you would really have to be a Muppet to sell at that price with the upcoming divvy now wouldn't you.(Unless you needed the money urgently of course)

[QOH]

Call me a traitor but despite being an AIR shareholder I couldn't resist $9 flights to Nelson.

[TheHunter]

Call me a traitor but despite being an AIR shareholder I couldn't resist $9 flights to Nelson.

Should have got AIR's $9 flights then had the best of both worlds ;)

[QOH]

Should have got AIR's $9 flights then had the best of both worlds ;)

darn didn't see them.

[couta1]

The Muppets are back:eek2:

[ddrone]

The Muppets are back:eek2:

Looks like the same old afternoon trading pattern to me... 2.46 close?

[Hoop]

The Muppets are back:eek2:

To be precise they are Asian Muppets Couta...Look for The Swedish Chef tonight in Europe...Kermit the frog, Miss Piggy and the rest of the gang later on when Wall St opens..

Wall St futures about 1% down already

[couta1]

To be precise they are Asian Muppets Couta...Look for The Swedish Chef tonight in Europe...Kermit the frog and Miss Piggy later on when Wall St opens..

Wall St futures about 1% down already Thanks Hoop they obviously don't read this thread, I think I'll retreat to the airplane hanger until next week.

[Beagle]

To be precise they are Asian Muppets Couta...Look for The Swedish Chef tonight in Europe...Kermit the frog, Miss Piggy and the rest of the gang later on when Wall St opens..

Wall St futures about 1% down already

Yeah I was thinking the same thing...a whole herd of them. Shanghai market down 3% now, Wall St futures tanking, Chinese authorities talking about withdrawing their contrived support for that market e.t.c. e.t.c.
Leaving my truck in the garage for now...its the only one I have so no point parking it in front of an Asian bullet train coming at 200 m.p.h. is there !

Iceman, common mate fess-up...you've been busy all morning booking $9 flights from Nelson haven't you:ohmy:

[KiwiGekko]

Looks like the same old afternoon trading pattern to me... 2.46 close?


Closed at 2.47 - not far off ddrone, another day of the SP rising in the morning and closing lower still. Nasty stuff.



Leaving my truck in the garage for now...its the only one I have so no point parking it in front of an Asian bullet train coming at 200 m.p.h. is there !


Probably wise right now in my opinion, as I mentioned earlier I think the fundamentals of AIR are good, but the markets appetite for risk is not and the market can stay irrational longer than one can stay solvent so I would be trading accordingly.

KG.

[Beagle]

https://www.youtube.com/watch?v=7aT8iO6Pwz0 Play this Couta1 and have a stiff drink - Round 1 to the Muppet Asians but the battle isn't over.

[couta1]

To be precise they are Asian Muppets Couta...Look for The Swedish Chef tonight in Europe...Kermit the frog, Miss Piggy and the rest of the gang later on when Wall St opens..

Wall St futures about 1% down already Well it looks like the Asian Muppets were the biggest Muppets of all, Kermit ,Miss Piggy and the rest of the gang were mainly down less than 1%, anyway I've got people to help and the divvy will be the same size regardless so Couta over and out for a while. PS-Muppets are like Bogans, you can't change them, they are what they are.

[Bjauck]

Should have got AIR's $9 flights then had the best of both worlds ;) Surely as AIR shareholders we should buy Jetstar's $9 flights and let them carry the loss on the below cost tickets. Then when the ticket prices go back up, we should continue to fly AIR!

[Beagle]

Surely as AIR shareholders we should buy Jetstar's $9 flights and let them carry the loss on the below cost tickets. Then when the ticket prices go back up, we should continue to fly AIR!

Yes there's a school of thought that says that's a good idea especially if you're XXL and weigh their aircraft down so they burn more fuel.

[sb9]

Opened 1c down today, contrast that with last 4 trading days where it opened higher and sold off by day's close, so hopefully it'll finish up today...reversal of trading pattern may be?

[Bjauck]

Yes there's a school of thought that says that's a good idea especially if you're XXL and weigh their aircraft down so they burn more fuel.
Aye that's true...and I have a good lot of Winter fat plus the thick Winter jacket I wear. The old Jetstar would be lucky to make into the air!

[Hoop]

Well it looks like the Asian Muppets were the biggest Muppets of all, Kermit ,Miss Piggy and the rest of the gang were mainly down less than 1%, anyway I've got people to help and the divvy will be the same size regardless so Couta over and out for a while. PS-Muppets are like Bogans, you can't change them, they are what they are.

Yep..Couta ..and it takes all sorts to make a market..and when there's enough of them they can dominate the Market Place.
Markets run in cycles and there are lengthy periods when the "Dark Forces" rule and money evaporates...
Sometimes you hear TA as being a Dark Art..That's true.. TA can measure and record everything Good v Evil therefore it can observe the emergence and activities of Dark Forces be it Muppets Bogans and I guess you have to add Shorters to that List too..
The Good lose control when they are "all in" as they can not keep the buy momentum up on the supply/demand equation...

It's amazing really when you talk to people and they say they have bought into the company such as AIR..They shake their heads in total disagreement when I say.."That's not entirely true, as you have also bought into a market that trades in AIR shares".

[Beagle]

Aye that's true...and I have a good lot of Winter fat plus the thick Winter jacket I wear. The old Jetstar would be lucky to make into the air!

LOL Sounds like if there was 50 blokes our build they might have a problem :)

http://www.distancefromto.net/between/Auckland/Nelson
Speaking of costing them money. AIR's cost per available seat kilometre, (ASK) is 10.5 cents but seeing as Jet are using very old aircraft, staff and pilot's from overseas e.t.c. at the very lowest possible cost lets say there's is 9 cents per ASK so the flight to Nelson that some booked yesterday at $9 actually cost Jetstar (507.82 km's x 0.09) = $45.70...so you're helping Jetstar lose $36.70 on that flight so those people who took advantage of that opportunity can in a perverse way feel they're doing AIR N.Z. a favour lol

[Traderx]

Hmm brought in today a small amount @ 246, only to watch it break down to 238!! Ahh the perils of the market.

[gv1]

Not that I sound patriotic BUT I have flown with other airlines, No matter what Air provides the warm, friendly service that makes me always book with them. I may or may not be the s/holder but I enjoy travelling with air. That goes with any business, if they can't smile and be friendly I stop shopping with them.

[sb9]

Opened 1c down today, contrast that with last 4 trading days where it opened higher and sold off by day's close, so hopefully it'll finish up today...reversal of trading pattern may be?

May turnaround by close today looking at last few days trading pattern or am I being too optimistic?

[KiwiGekko]

May turnaround by close today looking at last few days trading pattern or am I being too optimistic?

What the market will do is anyones guess at the moment. Just look at Oil overnight for example, however the volume on AIR is low at the moment and seems that people are extremely keen to get out causing quite a bit of downward pressure on the SP. My powder is staying dry.

KG.

[Beagle]

I suspect some of the Asian holders are annoyed by the double whammy of seeing the SP decline as well as taking a beating on the value of their holding with the $Kiwi falling. That and when the custard hits the fan in their home market the natural tendency for some international investors is to round up one's remaining chooks from overseas and transfer them into their domestic pen.

[Nasi Goreng]

Oil overnight went from NZD$68.53 per barrel to NZD$74.43 per barrel. An increase of 8.6% for their biggest variable input cost. In the background, they have increased domestic competition and twitchy markets.

[stoploss]

LOL Sounds like if there was 50 blokes our build they might have a problem :)

http://www.distancefromto.net/between/Auckland/Nelson
Speaking of costing them money. AIR's cost per available seat kilometre, (ASK) is 10.5 cents but seeing as Jet are using very old aircraft, staff and pilot's from overseas e.t.c. at the very lowest possible cost lets say there's is 9 cents per ASK so the flight to Nelson that some booked yesterday at $9 actually cost Jetstar (507.82 km's x 0.09) = $45.70...so you're helping Jetstar lose $36.70 on that flight so those people who took advantage of that opportunity can in a perverse way feel they're doing AIR N.Z. a favour lol

So AIR NZ , matching $ 9.00 fares are losing almost as much ...... The risk AIR NZ take is a massive loss of goodwill from its regular customers on these routes ....IE : ripped us off for ages and now there is competition you drop the price . A certain % of people will stay with Jetstar if they can keep the service levels up .

[Beagle]

https://nzx.com/companies/AIR/announcements/269436

Chairman Tony Carter buys on market. You're in good company Couta1.

[sb9]

Posted that on Follow the insiders thread....

[mikeybycrikey]

I know that the SP is about 20% from the recent highs of about $3.00 but this thread seems to be turning into an AIR fan club rather than a group of rational investors.

AIR might be a well run business but with large recent drops in world markets, falling oil prices making competition more likely (and the usual airline competition strategy of a price war), increasing likelihood of a NZ recession thanks to the dairy rockstar falling off a cliff, etc, etc

Airlines are a low-margin, high-risk business with very high running costs. No matter how well-run an airline is, it is going to be a cyclical business simply because of the low margins: if customers fall by a little (perhaps thanks a recession), profits are going to drop by a lot.

I'm still holding but the lower the price goes, the more I wonder if there really are rocky times ahead and if I've made the wrong choice by not selling.

[Traderx]

I know that the SP is about 20% from the recent highs of about $3.00 but this thread seems to be turning into an AIR fan club rather than a group of rational investors.

AIR might be a well run business but with large recent drops in world markets, falling oil prices making competition more likely (and the usual airline competition strategy of a price war), increasing likelihood of a NZ recession thanks to the dairy rockstar falling off a cliff, etc, etc

Airlines are a low-margin, high-risk business with very high running costs. No matter how well-run an airline is, it is going to be a cyclical business simply because of the low margins: if customers fall by a little (perhaps thanks a recession), profits are going to drop by a lot.

I'm still holding but the lower the price goes, the more I wonder if there really are rocky times ahead and if I've made the wrong choice by not selling.

I like the concept of "margin of safety"

At $2.40ish is there a sufficient margin of safety for AIR?

According to reuters the FY16 EPS mean forecast is 44.1cpl and FY17 is 36.53

If we take the FY17 number we have a forward PE of 6.6, we currently have price to tangible book of 1.5, gross div yield of circa 9.5% (based in gross est of 23cpl).

We have a strong "moat" of nationwide full service network, 2.x million frequent flyers, patriotic support, secular trend of migration driving international connectedness, tourism, depressed fuel prices, plane efficiency, international trade agreements.

In my view the primary cloud on the horizon is not Jetstar which will struggle for the foreseeable future due to scale and poor customer preference, but rather climate change action. There is the strong prospect that carbon prices and regulation will increase sharply from here for the foreseeable future. crimping growth.

So a very mixed and volatile picure but for me currently the metrics are very strong, and I think there is sufficient "margin of safety" (just).

Cheers

[skid]

I know that the SP is about 20% from the recent highs of about $3.00 but this thread seems to be turning into an AIR fan club rather than a group of rational investors.

AIR might be a well run business but with large recent drops in world markets, falling oil prices making competition more likely (and the usual airline competition strategy of a price war), increasing likelihood of a NZ recession thanks to the dairy rockstar falling off a cliff, etc, etc

Airlines are a low-margin, high-risk business with very high running costs. No matter how well-run an airline is, it is going to be a cyclical business simply because of the low margins: if customers fall by a little (perhaps thanks a recession), profits are going to drop by a lot.

I'm still holding but the lower the price goes, the more I wonder if there really are rocky times ahead and if I've made the wrong choice by not selling.

absolutely spot on MBC--That warm glow of the increase from just under $2 is now in reverse---Its a hard pill to swallow,but it may be time to open up the eyes and look at the outside world----It may be a nicely built little boat,but atm its trying to make its way through a cyclone.

[QOH]

LOL Sounds like if there was 50 blokes our build they might have a problem :)

http://www.distancefromto.net/between/Auckland/Nelson
Speaking of costing them money. AIR's cost per available seat kilometre, (ASK) is 10.5 cents but seeing as Jet are using very old aircraft, staff and pilot's from overseas e.t.c. at the very lowest possible cost lets say there's is 9 cents per ASK so the flight to Nelson that some booked yesterday at $9 actually cost Jetstar (507.82 km's x 0.09) = $45.70...so you're helping Jetstar lose $36.70 on that flight so those people who took advantage of that opportunity can in a perverse way feel they're doing AIR N.Z. a favour lol
I promise to wear lots of clothes on my $9 flight, if it happens, by Feb they might not be flying, last bargain I got with Jetstar was a $49 Wgtn To Queenstown , but about 3 days after purchase, they decided they were no longer flying that route. I don't think they plan ahead at all.

[Beagle]

I guess people face a stark choice...they can listen to all the media reports about doom and gloom and consumer confidence at a six year low and the latest business confidence survey also at a six year low or they can listen to the CEO and CFO at the latest conference call. I know what I heard, the company is weathering the current challenges very well and has done throughout FY15, the latter part of which was far from robust...people forget dairy falling off the face of a cliff is hardly new news...that started happening in late 2014. The company is very confident about a substantial increase in earnings for FY16 and the chairman has backed that up with his first share purchase for quite some time yesterday.
People are free to believe what they like but for mine actions speak louder than words so you can read plenty into Tony Carter buying shares yesterday.
Smart investors will have read the financial reports and notes already off the NZX website attachments...I'm not going to tell the doubting Thomas's what's in there of significant interest, read it for yourself.

[IAK]

Some good news for a change..A new strategic alliance between Air New Zealand and Air China will make New Zealand a more attractive destination for Chinese travellers, Transport Minister Simon Bridges says. http://www.voxy.co.nz/business/air-nz-air-china-alliance-authorised/5/230600

[Sideshow Bob]

Some cool stuff you don't get with Wetstar.....

http://www.nzherald.co.nz/travel/news/article.cfm?c_id=7&objectid=11506233

[winner69]

May turnaround by close today looking at last few days trading pattern or am I being too optimistic?

You be OK .... up by end of day a cert now

[arc]

Roger:
I agree with your sentiment. The present market is due to two things. One is blind public panic and the resulting tendency for larger players to capitalise on these "cyclic events", the other is the nature of the event that initially triggered the panic... one tends to leave footprints in soft sand

The alliance with the Chinese for their domestic market is good news as is increasing exposure to USA. The confidence factor expressed by the increased divy is a healthy sign. Im not saying the market wont fall again tomorrow as stupidity reigns but it is just that plain stupidity, mixed in with a large dose of "drive it lower in order to increase personal buy back exposure"

GO AIR...

[sb9]

You be OK .... up by end of day a cert now

Not a bad finish, wasn't it...up half a cent at close.

So the trick for AIR is to open lower...:p

[Regi]

Well I must say I was worried earlier in the day at its low... hopefully a slightly different (i.e better) trading pattern from here like some have suggested. But that's just being hopeful.

Still the dog in the mud Roger or you chasing Couta in a newly loaded Hilux?:D

[ddrone]

AIZ closes at AU$2.20, US markets looking bad, Asian markets sliding. I doubt we've hit a bottom just yet much as I wish I'd traded that 2.38 low today..

[iceman]

Some good news for a change..A new strategic alliance between Air New Zealand and Air China will make New Zealand a more attractive destination for Chinese travellers, Transport Minister Simon Bridges says. http://www.voxy.co.nz/business/air-nz-air-china-alliance-authorised/5/230600

Good news indeed. Now I´d like AIR to take this a step further and start promoting Auckland and New Zealand not only as a destination, but also as a hub for Chinese travellers going to Argentina/ South America. If well marketed, they could fill each and every of their Buenos Aires planes many times over. Chinese tourists to South America currently mainly travel through Europe, often with cumbersome connections
This is a big opportunity for AIR

[vin]

Good news indeed. Now I´d like AIR to take this a step further and start promoting Auckland and New Zealand not only as a destination, but also as a hub for Chinese travellers going to Argentina/ South America. If well marketed, they could fill each and every of their Buenos Aires planes many times over. Chinese tourists to South America currently mainly travel through Europe, often with cumbersome connections
This is a big opportunity for AIR

Agreed great news & a massive opportunity. Hope this plays out well.

[Regi]

So the market responds to positive news with a 2.8% drop... What is going on?? All sense of rationality gone because of the current economic climate or what?

[couta1]

So the market responds to positive news with a 2.8% drop... What is going on?? All sense of rationality gone because of the current economic climate or what?
She's ugly all over Regi, even Spark has now dropped, divvy next week is some consolation.

[mikeybycrikey]

So the market responds to positive news with a 2.8% drop... What is going on?? All sense of rationality gone because of the current economic climate or what?

I think that's because this isn't really news.

I'm pretty sure that this has been known about for a while and it was only waiting on approval by the Minister. Any move from this news should've happened a while ago and already be priced in.

[Marilyn Munroe]

I caught Ewan Wilson of Kiwi Airlines fame on the radio speculating the routes announced by Propstar were designed as a feeder service for a yet to be announced AKL --> LAX service by Queer And NasTy AirlineS.

Christopher Luxons minions will be hoping it's not an A380 if Chris is a telephone chucker.

Boop bopp de do
Marilyn

[airedale]

She's ugly all over Regi, even Spark has now dropped, divvy next week is some consolation.

Settle down Couta, hold the excitement, the Spark divi is not paid until the 9th October.

[couta1]

Settle down Couta, hold the excitement, the Spark divi is not paid until the 9th October. I was meaning that Air goes Ex next Wednesday.

[Joshuatree]

JT I sold my SCL on your storm warning a few months ago having bought at $1.36 so I won't be following your advice on Air- Lol

Why didn't you buy back when the storm passed?:confused:

[janner]

Just a follow up from my report of approx. 4 weeks ago to Tokyo..

Then the flight was below 50%. occupancy

Returned flight yesterday was dubiously about 50%. occupancy

Company Reports are about history.

Having said that... Great aircraft.. Great service.. A very comfortable flight..

Disc.. Not a holder.

[mikeybycrikey]

Just a follow up from my report of approx. 4 weeks ago to Tokyo..

Then the flight was below 50%. occupancy

Returned flight yesterday was dubiously about 50%. occupancy

Company Reports are about history.

Having said that... Great aircraft.. Great service.. A very comfortable flight..

Disc.. Not a holder.

Interesting. Thanks for the update.

AIR does release monthly operating statistics (available here http://www.airnewzealand.co.nz/monthly-operating-data, or from NZX, where they are more up-to-date). In the latest one the load factor for Asia/Japan/Singapore was 83.9%.

I'm wondering if Japan is doing worse than the rest of Asia for load or if the flights you were on are just unusual.

[Master98]

Just a follow up from my report of approx. 4 weeks ago to Tokyo..

Then the flight was below 50%. occupancy

Returned flight yesterday was dubiously about 50%. occupancy

Company Reports are about history.

Having said that... Great aircraft.. Great service.. A very comfortable flight..

Disc.. Not a holder.
lol. know how lucky you were, one ticket for two seats.:t_up:

[m4054]

Interesting. Thanks for the update.

AIR does release monthly operating statistics (available here http://www.airnewzealand.co.nz/monthly-operating-data, or from NZX, where they are more up-to-date). In the latest one the load factor for Asia/Japan/Singapore was 83.9%.

I'm wondering if Japan is doing worse than the rest of Asia for load or if the flights you were on are just unusual.
Don't forget those flights to Shanghai or Hong Kong have been full every single day of a year...:t_up: I caught one to Shanghai last year at Christmas Eve (yes, 24th December 23:00) and it was 100% full!!

[janner]

Don't forget those flights to Shanghai or Hong Kong have been full every single day of a year...:t_up: I caught one to Shanghai last year at Christmas Eve (yes, 24th December 23:00) and it was 100% full!!


As I said... History.. :-)))

This was two ways over 4 weeks..

[janner]

lol. know how lucky you were, one ticket for two seats.:t_up:

Many had three seats.

Disc. Not a holder.

[Zaphod]

One silver lining to the recent market turmoil is that yield has further improved. Admittedly, that's small consolation for those who purchased well above the current SP no doubt in hope of catching a falling knife, but it is a consolation none the less.

[couta1]

Why didn't you buy back when the storm passed?:confused:
Post storm apathy:cool:

[ddrone]

Bit of a sea change out there today kids...

[cdonald]

Bit of a sea change out there today kids...

The day is not over yet, afternoon madness has still got time to prevail.

[ddrone]

The day is not over yet, afternoon madness has still got time to prevail.

Even so it's the healthiest depth I've seen in a couple of weeks.

[tzbang]

This might seem like a stupid question (I'm a noob).. but why does the depth chart go all crazy after close with buyers and sellers all on top of each other and all over the place?

[allfromacell]

This might seem like a stupid question (I'm a noob).. but why does the depth chart go all crazy after close with buyers and sellers all on top of each other and all over the place?

The last 15 minutes are suspended until 5 when they all go through. I'm wondering why people put such crazy orders in during this time. Eg Huge sells well below the bid... I'm a noob too.

[couta1]

The last 15 minutes are suspended until 5 when they all go through. I'm wondering why people put such crazy orders in during this time. Eg Huge sells well below the bid... I'm a noob too.
The purpose of the pre close 15 mins is actually to stop any crazy orders from going through, things swing to and fro during this period in what can seem like chaos(Especially with large cap stocks) but normally the close price occurs pretty close to the VWAP for the day so all those seemingly crazy orders actually bring a balance to things eg Air VWAP today $246.6, close $2.48.

[IAK]

Some good news for a change..A new strategic alliance between Air New Zealand and Air China will make New Zealand a more attractive destination for Chinese travellers, Transport Minister Simon Bridges says. http://www.voxy.co.nz/business/air-nz-air-china-alliance-authorised/5/230600

According to the man interviewed on 1ZB approx. 137,000 seats per annum.

[mikeybycrikey]

Interesting profile of Christopher Luxon in the Herald tonight:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11506799

[ddrone]

Dividend goes ex-divvy next Friday. Couple of questions around this:

- I assume this means holders at close of trading Friday will be entitled to the dividend?
- What usually happens in ex-Dividend trading. Should we expect an almost immediate drop by ~9c on Monday or is it not quite that straight forward?

Given the markets I'm in 100% trade mode so I'm working to ensure I have my timing right and (barring the usual events) don't get any unexpected surprises.

[couta1]

ddrone it goes ex next Wednesday not Friday.Post divvy share price behaviour is completely unpredictable especially in the current environment, often it drops by more than the divvy amount but recently SCL didn't drop at all basically so toss a coin, although Air current share price is below its true value IMO so we will see.

[macduffy]

Just to add to that. Settlements and registry changes happen three business days after trades. "Record date" means the holdings on the register at the close of business on record day. Quoting "ex div" starts at the beginning of the "ex" nominated trading day.

As couta implies, market conditions and individual stock circumstances dictate what happens to a SP when the share goes "ex".

[Beagle]

Interesting profile of Christopher Luxon in the Herald tonight:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11506799

I am very happy with the job C.L. is doing. We are very fortunate as shareholders to have a dynamic leader of this calibre as CEO.

To the naysayers...AIR publish their operating stat's monthly, aircraft loadings by region and yield. What other N.Z. company effectively posts their sales results by sales type and pricing every single month ? (Answer None). Loadings to China have been about 75% in recent months which is lower than the average fleet and world-wide loadings of circa 84% because they've recently up-gauged from 767 aircraft seating 230 people to the new Dreamliners seating 302 people.

A flight here than there that is loaded to 50%, (while I have no reason to doubt the objectivity of that post), doesn't concern me because forward sales at balance date were comfortably ahead of the previous year and the company itself is extremely confident of a SUBSTANTIAL rise in earnings this year, (put in block letters because that's the emphasis that was placed on the word in the conference call, so effectively their emphasis not mine).

People have three business days to buy the stock if they want extra fully imputed 9.5 cent final divvy's.

[couta1]

Welcome back from the cooler Roger, must have been a minor offense, at least your straight up mate and don't feel the need to take on multiple identities to get your points across.

[percy]

Welcome back from the cooler Roger, must have been a minor offense, at least your straight up mate and don't feel the need to take on multiple identities to get your points across.

Low blow does you no credit.

[Beagle]

Welcome back from the cooler Roger, must have been a minor offense, at least your straight up mate and don't feel the need to take on multiple identities to get your points across.

Thanks mate.

[ddrone]

ddrone it goes ex next Wednesday not Friday.Post divvy share price behaviour is completely unpredictable especially in the current environment, often it drops by more than the divvy amount but recently SCL didn't drop at all basically so toss a coin, although Air current share price is below its true value IMO so we will see.

The market disclosure says record date is Friday. Am I reading it wrong?

[BobbyMorocco]

The market disclosure says record date is Friday. Am I reading it wrong?
NZX website says it's ex div on Wednesday, 9th September.

[Beagle]

The market disclosure says record date is Friday. Am I reading it wrong?

Record date means the shares must be in your name by that date, i.e. the date of record. As settlement on the NZX trading system is (T+3), i.e. the date of the trade plus 3 business days, the last date you can purchase shares and they will be recorded as being in your name at close on business on Friday is Tuesday. That's why the first day of ex divvy trading is Wednesday and that's known as the day the stock trades ex divvy. Hope that clarifies and helps.

[ddrone]

Record date means the shares must be in your name by that date, i.e. the date of record. As settlement on the NZX trading system is (T+3), i.e. the date of the trade plus 3 business days, the last date you can purchase shares and they will be recorded as being in your name at close on business on Friday is Tuesday. That's why the first day of ex divvy trading is Wednesday and that's known as the day the stock trades ex divvy. Hope that clarifies and helps.

Need to be holding on Tuesday then. Got it thanks mate.

[Beagle]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11508152

Marilyn Munroe believes the airline should have been sold to Etihad LOL

[Marilyn Munroe]

Marilyn Munroe believes the airline should have been sold to Etihad LOL

A position I still hold, remember the reason we own part of Cullen Airlines is the taxpayer galloped to the rescue when it was on its knees.

Where else could this money have been better spent, hip replacement operations, funding the Auckland central rail link tunnels, or decent metal health treatment?

There is no continuing strategic reason for the tax payer to continue to own Cullen Airlines. Other airlines could easily increase their inbound/outbound capacity if Cullen Airlines went away.

Yes Roger, luckily it has been a good investment for the tax payer but there is no guarantee it will continue. Market trader John Key should take Etihad's money and run.

Boop boop de do
Marilyn

[couta1]

A position I still hold, remember the reason we own part of Cullen Airlines is the taxpayer galloped to the rescue when it was on its knees.

Where else could this money have been better spent, hip replacement operations, funding the Auckland central rail link tunnels, or decent metal health treatment?

There is no continuing strategic reason for the tax payer to continue to own Cullen Airlines. Other airlines could easily increase their inbound/outbound capacity if Cullen Airlines went away.

Yes Roger, luckily it has been a good investment for the tax payer but there is no guarantee it will continue. Market trader John Key should take Etihad's money and run.

Boop boop de do
Marilyn Let the good times roll (Seemed appropriate as I'm just listening to one of The Cars albums)

[Beagle]

A position I still hold, remember the reason we own part of Cullen Airlines is the taxpayer galloped to the rescue when it was on its knees.

Where else could this money have been better spent, hip replacement operations, funding the Auckland central rail link tunnels, or decent metal health treatment?

There is no continuing strategic reason for the tax payer to continue to own Cullen Airlines. Other airlines could easily increase their inbound/outbound capacity if Cullen Airlines went away.

Yes Roger, luckily it has been a good investment for the tax payer but there is no guarantee it will continue. Market trader John Key should take Etihad's money and run.

Boop boop de do
Marilyn

That's amusing. Biggest white elephant than only 5% of Aucklanders would ever use, forget about all other Kiwi's. Lets forget about protecting national interest shall we and further to what Bryan Gaynor wrote, all the billions of dollars of tax that's been remitted to the government through both AIR's company tax and PAYE from its circa 10,000 employees shall we ? Anyway you slice and dice this thing the Govt's investment in our national airline is one of the greatest success stories of investment that's ever been written. You see if you read up on the history of the company you'll learn that one of the reasons the Govt wanted to invest in Teal in the first place was company tax. Strange that the Govt wants to paddle its own canoe...or is it :)
I would say the mixed ownership model is working extremely well in regard especially to AIR.

Classic album that one Couta1...one of my fav's.

[Beagle]

Well I must say I was worried earlier in the day at its low... hopefully a slightly different (i.e better) trading pattern from here like some have suggested. But that's just being hopeful.

Still the dog in the mud Roger or you chasing Couta in a newly loaded Hilux?:D

Sorry mate I missed your question from a few days ago while I was having an untoward holiday from ST. Keeping my powder dry at this stage.

[h2so4]

Just to add to that. Settlements and registry changes happen three business days after trades. "Record date" means the holdings on the register at the close of business on record day. Quoting "ex div" starts at the beginning of the "ex" nominated trading day.

As couta implies, market conditions and individual stock circumstances dictate what happens to a SP when the share goes "ex".

I'm picking some analyst will come out with a buy recommendation tomorrow.

Let the good times roll.

[h2so4]

......with a $3.80 - $3.90 price target. :)

[Beagle]

http://www.4-traders.com/AIR-NEW-ZEALAND-LIMITED-6491407/consensus/

Consensus FY16 EPS now 45 cps. On tomorrow's theoretical ex divvy price, ($2.54 less dividend $.095) = $2.445, that's a FY16 PE of ($2.445 / $0.45) 5.43 !!..."horribly expensive" eh !! :D
We live in "interesting times" so notwithstanding the compelling metrics I have parked the truck up for now and am content to hold a reasonable sized allocation to AIR.

[tzbang]

Hasn't the consensus FY16 eps been 45cps for quite a while now?