AIR - Air NZ.

[beacon]

Things are improving, yet sentiment deteriorates. Which will win? Much as I hate it, reduced holding today ...

[Dr_Who]

Things are improving, yet sentiment deteriorates. Which will win? Much as I hate it, reduced holding today ...

My exact thoughts. I couldnt make up my mind las week to buy AIR at $1.10 or not. I was so close to buying some shares, but was weighing the weak economy with possible lower short term oil price movement.

[BRICKS]

BRICKS returns to Oz on the 5th AUG after his winter stint in NZ but this time flying QANTAS so why well AIR has cut out 4 flights to SYDNEY smart move and its the peak hour flight of 4.15 PM time to up the numbers on other flights, Fly QANTAS..

[Phaedrus]

This long-term AIR chart provides 3 perfect textbook examples of volume confirming price. Take a look at the 3 highest volume days of the last few years (the tallest bars in the volume histogram at the bottom of the chart) See how, without exception, these came just after what turned out to be the extreme limit of the preceding trend and after trendline breaks had triggered buy or sell signals. In other words they provided clear and unmistakable confirmation of the preceding signals.

At first glance, this chart might appear to show 3 "price/volume climaxes" as shown for NZO here (http://www.sharetrader.co.nz/showthread.php?t=5112&page=363) but if you look more closely you can easily see that they are quite different in that the volume peaks came a week or more after the price peaks/troughs.

http://h1.ripway.com/Phaedrus/AIR725.gif

Those who, like TB "have been trying to seek evidence for a long time whether TA should be a valid share investment decision making tool" might like to note the following TA principles that are illustrated by this chart.
See how support was found at $1.09. This is the same level exactly to the cent as was found two years previously. The market has a long memory.
See how marked increases in volume tend to occur at around significant turning points.
See how the On Balance Volume indicator provides excellent and timely confirmation of trendline break buy/sell signals.
See the folly of buying and holding long-term - AIR is right back to where it was many years ago.
See how slightly more active investors (making just a single trade in 3 years) can gain superlative returns from the same stock.
See how, while the trailing stops gave reasonable entry/exit signals, they generally lagged well behind all other indicators (including the many oscillators featured in previous AIR charts on this thread).

Yeah yeah, I know.......... Warren said never touch airline stocks - but look at the opportunity you would have missed by following that dictum!

[Footsie]

That chart should be in a text book

Perfect TA

[Phaedrus]

A better tool might be understanding the oil price/airline relationship.....
Better than understanding the shareprice/volume relationship Mo? I disagree strongly! Take a look at the attached chart and you will see why. It is quite obvious that the relationship between AIR and the price of Oil is too loose for the price of Oil to provide any useful guide as to whether/when to buy/sell AIR.


Why look at the effect of the accumulation and rally when you can look to the cause?
THE cause?? Mo, there are many reasons why AIR would be accumulated or distributed, or why the shareprice would rise or fall. While we may be aware of a few of them, there are plenty more that are outside our knowledge. The shareprice, however, reflects the sum total of all that is knowable about AIR. That's why buy/sell decisions based on the shareprice are demonstrably far superior to those based on the price of Oil - or any other single factor.

We all accept that the price of Oil has an influence on the profitability of airlines and thus the performance of airline stocks - but it is only one factor of many. In any case, whatever effect the price of Oil has on AIR is already built into the shareprice and there is no need to re-apply it. In fact, this would be counterproductive because you would then be overemphasising the influence of oil prices on AIR.

Mo, I don't believe you are seriously suggesting that "understanding the oil price/airline relationship" is a better tool for trading AIR than understanding the price/volume relationship. I am forced to assume that this must be another of your "wind-ups"! Right?

http://h1.ripway.com/Phaedrus/AIRoil726.gif

[Phaedrus]

Sure Mo - just so long as you view it as a favour, not as a "bite"!

AIR has formed a "Pennant". These are usually a short-term consolidation pattern - in other words, the breakout is most commonly upwards. They have a failure rate of 19%. (Bulkowski considers a failure rate above 20% to be unacceptable.) Keep in mind here that the highest failure rate you can have is 50%. The volume trend during the pennant is typically down as shown here by the magenta line.
These formations can be profitable short-term investments, but you must be nimble and attentive to take full advantage of them.

Technically, you have jumped the gun by selling before any downward breakout, but I am sure you have your reasons.

http://h1.ripway.com/Phaedrus/AIR85.gif

[Phaedrus]

I don't put all that much faith in pennants. Its 19% failure rate is too close to Bulkowski's "unacceptable" error rate of 20% for my tastes. For all that, I don't see why the pennant can't simply be redrawn if you wanted to (see below). To my mind, this is equivalent to redrawing support at (say) $1.90 when previous support at $1.92 was broken by a couple of cents - or redrawing a trendline to take in a new peak that had previously penetrated it by just a few cents.

http://h1.ripway.com/Phaedrus/AIR811.gif

AIR is not in an uptrend until/unless it Closes above $1.28 and it is not in a downtrend until/unless it Closes below $1.23. In the meantime, it is essentially trendless. A significant move in the price of oil would probably shift AIR out of its current congestion zone.

I notice there is a big seller at $1.30.

[Phaedrus]

The pennant broke down today.

http://h1.ripway.com/Phaedrus/AIRpen.gif

[Dr_Who]

The pennant broke down today.



What does that mean? Trending down again?

[Phaedrus]

While this does have Bearish connotations, there is no downtrend as yet. Friday's Close was at $1.23 - exactly the level of previous support on 29/7/08. A Close below this would mean a downtrend though. (It would give a lower Low after a lower High)

[KiwiBear]

Yes Phaedrus, I concur! Penant can go either way usually before the triangle forms.
But this one has shown its direction and will at least retrace to 1/2 the previous pole rise.
My pick being that of prev resistance of around the $1.16 mark.
A good buy on the rumour sell on the fact, just posted a reasonable growth in this weekends Press.
The Bear

[upside_umop]

Will see on monday KB.
That $6 drop in oil should restrict that movement for time being.

[Robomo]

I've heard from a couple of people, who have some credibility, that Air New Zealand have been doing due diligence on Pacific Blue in Australia. This is presumably with the aim of increasing their presence within NZ's biggest inbound tourist market.

After the Ansett debacle I guess Air NZ would have to be very sure of their ground, however the concept of having a big stake in the domestic OZ market is still very attractive in my opinion. At the current PacBlu price, now might be an attractive time to buy in.

[BRICKS]

I've heard from a couple of people, who have some credibility, that Air New Zealand have been doing due diligence on Pacific Blue in Australia. This is presumably with the aim of increasing their presence within NZ's biggest inbound tourist market.

After the Ansett debacle I guess Air NZ would have to be very sure of their ground, however the concept of having a big stake in the domestic OZ market is still very attractive in my opinion. At the current PacBlu price, now might be an attractive time to buy in.


YOU & your friends are DREAMING but if your correct do you own VBA shares as BRICKS has been calling.. and holds a SWAG..

[KiwiBear]

As an AirNZ employee thats news to me!
But we do have a GR8 relationship with VB & Pac Blue doing their A/C heavy maintenance in Christchurch.

[Robomo]

No, don't hold any VBA but do hold AIR. If Air NZ did buy a controlling stake in Virgin Blue my guess is that it would have minimal impact on share price.

The move by the world's big airlines (British Air, American Airways, Iberia etc) to form megacarrier alliances reinforces that the future will lie with a few giant carriers with nothing much left for small independents.

Grow big or die.

[Robomo]

As an AirNZ employee thats news to me!
But we do have a GR8 relationship with VB & Pac Blue doing their A/C heavy maintenance in Christchurch.

My sources are in Air New Zealand. Can't say that anything is happening for sure but there are some pretty strong nudge/ nudge/ winks going on. I've also had a bit to do with the engineering in Christchurch so am aware of the relationship with VB and PB maintenance - which seems to be going well.

The sharemarket is all about rumour and innuendo anyway isn't it?

[KiwiBear]

My sources are in Air New Zealand. Can't say that anything is happening for sure but there are some pretty strong nudge/ nudge/ winks going on. The sharemarket is all about rumour and innuendo anyway isn't it?

Thanks, will be a GR8 discussion topic tonight at our team break.

[Robomo]

Thanks, will be a GR8 discussion topic tonight at our team break.

So what was the consensus of the engineering guys at your team break?

[KiwiBear]

2 partriges in a pear tree!
We don't think the government especially near election time will allow their money to go into another Aussie airline ailing.

We were working on a Pac Blue A/C in the early hours of this morning coming out of heavy maint - Pulling out the stops trying to get it ready for its early departure. Thats how close we are with these guys, many of their guys are ex AirNZ that we previously worked alongside. It was news to them as well as their rep!

My take is that we will probably align ourselves more and more rather than Qantas, as their engineers across the ditch are not working on our A/C any longer due to their ongoing industrials. So we have to put our engineers over in Aussie Airports to support our movements
Regards The Bear

[Robomo]

Thanks Bear, I'm hopefully catching up with one of my 'informants' (office based) in the next couple of days so will be interested to get an update on what he thinks.

Cheers, Robo

[dartMonkey]

There seems to be significant support at approximately 1.08 both recent and historical. I understand that when such strong resistance is broken it generally means a big breakout. Is the same true of support - ie the longer more historical the support the more likely it is to hold?

[Phaedrus]

...the more historical the support the more likely it is to hold?
Not really. In fact, the further back in history the support was, the less relevance it has to current price action. What is generally accepted as the best measure of the strength of support is the number of times it has been tested and held.

The more recently and longer the period of time that prices have traded in a support area, the more significant that level becomes.

The more times that support holds, the less likely it is to be broken and the more dire the outlook if it is broken.

http://h1.ripway.com/Phaedrus/AIR911.gif

[dartMonkey]

Thanx Phaedrus,
I have tried to upload a file so I hope it works. If it doesn't, I have drawn a trend line which seems to touch on the pennant as well ...
So, is one, ie the trend line or the support line, more significant than the other? ie would one buy on support or wait for a break above the trend line?

[dartMonkey]

Sorry,
forgot to save it after I drew the line.

[Dr_Who]

MAQ upgrades AIR to outperform and the sp drops... LOL

[biker]

J Beware have them as a sell with a target of 1.07

[Phaedrus]

Would one buy on support or wait for a break above the trend line?
Acting on the basis on any single signal in isolation is generally not considered to be good practice. In point of fact, neither of these buy signals would have much hope of any great follow-through in the absence of significant volume. One way to follow volume is by the use of an indicator such as the On Balance Volume as plotted here. The OBV would need to rise above the blue line for AIR to be doing anything of significance. So. we have 3 possible entry signals arising from this chart. It really is up to the individual to decide how to manage the mix, but here are a few suggestions :-
(1) A gung-ho supporter of AIR that was itching to invest may well buy up large on the basis of the first signal to fire - whichever one it was.
(2) A more cautious, conservative investor might wait for all 3 to trigger before committing any money at all.
(3) Buy as soon as any two signals have been triggered.
(4) Buy in three separate tranches, investing 1/3 of your allocated AIR investment funds as each indicator triggers.

http://h1.ripway.com/Phaedrus/AIR911tl.gif

[scamper]

mosteph, think you are having a confusion...
Sir P. has always recommended log scales -- trendlines are not useful otherwise.
i cant see a single hint of silver lining, now or in the near future, in the air chart.
i suspect winning this election might be a hospital pass as far as air is concerned. cheers.

[Phaedrus]

I see you've changed from linear to log price. How come?
We have the choice of using a Linear trendline currently sitting at $1.15 or a Log trendline currently sitting at $1.19 - an insignificant difference in my opinion. There is, however, another consideration. I'm sure I don't need to tell you that the more times a trendline has been tested, the more confidence it inspires and the more significant its penetration.

Which trendline would you recommend we use here - the Linear or the Log?

http://freefile.kristopherw.us/uploads/faydrus/air91ll.gif

[Lizard]

mosteph, think you are having a confusion...
Sir P. has always recommended log scales -- trendlines are not useful otherwise.


Scamper, I think MoSteph is referring to the previous chart with linear scale that Phaedrus used when they were discussing the break in July (as per green line no. 3) a couple of pages back.

[Jaa]

Bought some AIR shares @ 1.08 today. Final trigger for me was the large increase in US airline stocks overnight (10-20%).

I am a FA investor due to lack of knowledge about TA more than anything. Phaedrus, thanks to you and the charts above I am slowly beginning to learn what TA wise to look for, which is a start.

The thing that impresses me most about Air NZ is the constant route optimisation they do to maximise profits. This was a lesson the airline learned well from the Ansett debacle where rumour has it they literally had no idea which routes were making and losing money.

Both the systems they now have in place and some nimble management seem to allow the airline to change gears very quickly to changing circumstances. Witness the constant chopping and changing on the Tasman route and the recent use of smaller 777s in place of 747s on the London route.

[h2so4]

If you must invest in an airline, IMO, AIZ is the best out of AIZ, QAN,and VBA. At a pinch they could pay off their long term debt with 4 years of earnings, mind you liabilities are catching up to their assets and return on invested capital? About 8.3% FY08. If Cap/Ex are increased to the average, the return on investment falls to 6.18%.and 5 years of earnings will be needed to knock off the long term debt.What are bank deposit rates in NZ?

I note the Cap/Ex were a lot less than the Depreciation. GM in the US had a similar situation where depreciation exceeded Cap/Ex.for a number of years. hmmmm
cheers:)

[Dr_Who]

How low will AIRNZ go? Sp just hit $1.00!!!

Anyone out there brave enough to dip their toes? SKol where are you?

[Scuffer]

They are gettin' cheap but airlines are notoriously volatile stock I bought about 3 years ago at $1.45 and then topped up at $1.10 got out at $1.70 something, not been game to get back in since but they are looking tempting.

[Dr_Who]

96 cents... game over!

[biker]

96 cents... game over!

95 cents actually and holding $1 a share in cash, POO heading down, innovative
pro-active management. At last........game on!

[winner69]

95 cents actually and holding $1 a share in cash, POO heading down, innovative
pro-active management. At last........game on!

But what makes up most of that $1 share in cash .... prepaid fares ..... promises to fly people somewhere .... so it is not really company/shareholders cash is it

Remember a few years ago that AIR CEO from Aussie raving about the $1 billion in cash ..... broke a few months later I recall

[Dr_Who]

I dont think zombies can afford to fly away on holiday these days. Airlines and luxury goods will go first. Will AIR survive?

[biker]

I dont think zombies can afford to fly away on holiday these days. Airlines and luxury goods will go first. Will AIR survive?


Will New Zealanders keep paying tax?

Go the People's Airline ;-)

[BRICKS]

MELTDOWN a new word on TV well yesterday was a "Meltdown Day"

so will today be a "Melt up Day" take your PICK...

[BRICKS]

BRICKS returns to NZ on the 12 Nov for the XMAS break and looking at the share price
today they offer FREE shares on the plane as a Xmas Box because they are so cheep @ 89 cents who dares to BUY..

[Stranger_Danger]

Me. Violating the Warren principle alas. Oh well.

[BRICKS]

BRICKS returns to NZ on the 12 Nov for the XMAS break and looking at the share price
today they offer FREE shares on the plane as a Xmas Box because they are so cheep @ 89 cents who dares to BUY..

BRICKS could not help himself and helped NZ by supporting AIR when they hit the low 80`s
in we went next move who knows but it could be up ?? it seems that investors are looking but that is ALL..

[MrDevine]

How cheap can it get? POO due for a long term retrace, has to be good for AIR? People still have to fly, we're not leaving by boat just yet. Oversold IMHO.

Mr D.

[BDLBOM]

Commerce Commission up to their old tricks of springing surprises. Air NZ the target this time no warning, no consultation.
Just prosecution action out of the blue.
The time is way overdue for this mad woman Rebstock to go.

[POSSUM THE CAT]

BDLBOM did they not with Quantas settle the same charges with the American authorities or is it still pending. If management did not consider there would be charges laid here as well. The sooner they are removed from management of Air NZ the better

[Zaphod]

The inference is that either BA, Qantas or both were co-operating with the authorities regarding the so-called cartel.

AirNZ have stated that they have not been engaged by the commission for three years. That is a worry in itself!

It will be interesting to see what evidence actually exists.

Disc: Not an AIR holder.

[BRICKS]

WELL that cant be wrong AIR is at its bottom and so is everything else so wot
a better time than to BUY and build up the portfolio as the smoke is just about
to CLEAR..

[BRICKS]

WELL time for BRICKS to return to OZZ next Wednesday the ticket is $10 cheaper than last March 08 just hope AIR still pays a DIV this time round as BRICKS is HOLDING..

[paul29]

Is AIR a BUY at the moment at 92 cents a share?

Market Capitalisation: $976,232,454 (@92)
Earnings/Share: 20.67 cents
Price/Earnings Ratio: 4.45
NTA/Share: 145.38 cents
Dividend/Share: NZD 8.5 cents
Dividend Yield: 9.24%
1-Week Range (Low - High): 88 - 93
4-Week Range: 87 - 95
26-Week Range: 80 - 129
52-Week Range: 80 - 186

[boxing_beaver]

Im not too sure... passenger numbers are in a clear downtrend and on the long haul routes air nz will find it harder to decrease capacity. so far they've done that by switching from 747 to 777 services and by cutting num of flights per day. theyre approaching the stage where they cant really switch services from 747 to 777 anymore due to other constraints (747 bein phased out anyway) and if they cut anymore flights they will be effectively forcing passengers onto other airlines. in other words i dont think the outlook is good and there is probably worse to come. check out the hedging update (released last weeki think) for further info on the fuel hedging considering the falling fuel prices

[BRICKS]

BRICKS flies home today and another K RUDD hand out " O what a feeling "

[Phaedrus]

Is AIR a BUY at the moment at 92 cents a share?
No it isn't!

But what about the very clear BUY signal from the break of the confirmed trendline - one that had held good for over 18 months, I hear you ask. (or perhaps not)

Look carefully. AIR is in a trading range and this trendline was broken by AIR merely crabbing sideways. The 18 month trend is still down. Look also at the 4 other indicators at the top of the chart. See how they all confirmed the very timely trendline break SELL signal? Note the total absence of any such confirmation for this "Buy" signal, which should therefore be ignored.

AIR is of little or no technical interest until it breaks above or below its current trading range and is probably a good stock to be out of in the meantime.

http://h1.ripway.com/78963/AIR24.gif

[scamper]

goodness gracious -- i've just spent the last 20 minutes pondering this very issue (I still hold a few), and lamenting that reuters now longer gives out free obv!

Phaedrus, is it justified to be on heightened alert for air on the grounds that the 30- and 90-day MAs have crossed over, and the rvi, rmi, and slow stoch are all rising?
whatever, i'm grateful for the pointer that a trend break inside a trading range is a dodgy signal on its own. cheers.

[Phaedrus]

Is it justified to be on heightened alert for AIR on the grounds that the 30- and 90-day MAs have crossed over.......
I'm a bit puzzled by this comment Scamper - these particular MAs haven't crossed yet - I've checked using both Simple and Exponential. If they had, though, the answer would be NO. A crossover of 2 moving averages is a type of trend indicator. Trend indicators are of no use when a stock is in a trading range because all they do is give a series of conflicting signals. You might be interested to know that backtesting that particular crossover pair tells us that it has signaled 20 AIR trades over the last 20 years, comprising 15 losses and just 5 wins. Would a signal from an indicator that is wrong 3 times more often than it is right justify anything?



Is it justified to be on heightened alert for AIR on the grounds that.... the rvi, rmi, and slow stoch are all rising? No. Rising is good, though (better than falling!) but "heightened alert"? No. Especially "No" in this case where the OBV is falling. Without meaningful volume AIR is going nowhere in a hurry. The Alert comes when AIR breaks out of its trading range. Within the trading range there have been and will continue to be a raft of conflicting signals that are of little or no interest.



A trend break inside a trading range is a dodgy signal on its own. Yes, but be sure to realise that it was the absence of any oscillator support that really put the kibosh on that trendline-break "buy" signal.

[paul29]

Thanks Phaedrus AIR is on my watchlist

[scamper]

Thanks all. I'm not actually looking to buy anything atm, but am watching lots to see if i can learn and reduce mistakes...

[BRICKS]

Thanks all. I'm not actually looking to buy anything atm, but am watching lots to see if i can learn and reduce mistakes...

IF you look at the NZX turnover it appears that a great chunk of KIWI`s don't want
to know any thing about share BUYING..

[beacon]

And you can't really blame them... Thanks partly to NZX for enforcing a migration on the lazy birds ...

[BRICKS]

THE position of forward bookings five weeks ahead have the planes 50 % full in the past
it stood at about 60 - 65% and flying at about 71% so forward bookings is a worry
so if you intend to fly at lease you have the pick of the SEATS..

[ops.normal]

AirNZ have been finding their forward bookings are down but the load factor achieved is actually respectable - the difference is that people are waiting until later to finalise their travel arrangements.

[Dr_Who]

The load factor is reasonable, but I am told the discounting has put huge pressure on their margins. What about their fuel hedging, hows that affecting them with oil prices at these levels? Anyone know the fuel hedging position?

[ops.normal]

Still high, hedges are due to run out within 6 months I believe (don't quote me though) :P

The high hedges are mitigated slightly by the reduction in capacity, particularly long haul.

[scamper]

Great attitude from this company, pity about the numbers...
When is the record date for the 3 cps divi? -- it wasn't given in the report. cheers.

[BRICKS]

IF a stock is at an all-time low dose that make it a BUY well it is cheep getting assets
for next to nothing and its making a profit the times have changed on the NZX years
ago people have rushed in where did you GO wrong NEW ZEALAND..

[BRICKS]

IF a stock is at an all-time low dose that make it a BUY well it is cheep getting assets
for next to nothing and its making a profit the times have changed on the NZX years
ago people have rushed in where did you GO wrong NEW ZEALAND..

So after saying this yesterday, topped up to day as they are still cum div every
KIWI should cum to the cause and support the Airline and your Country..

[macduffy]

So after saying this yesterday, topped up to day as they are still cum div every
KIWI should cum to the cause and support the Airline and your Country..

Not a good reason to invest my money, IMO.

NZ Govt has the majority shareholding and no doubt will come to the party again, if necessary.
Meanwhile, I'll continue to take Warren Buffett's advice on airlines and steer clear.

;)

[BRICKS]

Not a good reason to invest my money, IMO.

NZ Govt has the majority shareholding and no doubt will come to the party again, if necessary.
Meanwhile, I'll continue to take Warren Buffett's advice on airlines and steer clear.

;)

SO you rely on the GOV to do your duty, and w buffet advice only suited his style
& outfit not to say it works for every one other wise there would be NO airlines and
if one word liners run the world there would be NO need to WORK..

[scamper]

Bricks, please can you advise the record and payment dates for the divi? Ta.

[BRICKS]

Bricks, please can you advise the record and payment dates for the div? Ta.


EX date 13 mar 2009, Pay date 27 mar 2009,, hurry just got time to BUY a few MORE..

Note the div will pay for the BROKERAGE.. GREAT..

[paul_nz]

SO you rely on the GOV to do your duty, and w buffet advice only suited his style
& outfit not to say it works for every one other wise there would be NO airlines and
if one word liners run the world there would be NO need to WORK..


What duty would we supposedly be relieving the government of, if buying AIR NZ?

I'm not aware the government are taking a greater share of AIR NZ, are they? Someone buying AIR NZ is giving their money to someone who decided to get out of AIR NZ .....

Bricks, your post has me confused to say the least... what you are advocating, every NZer buying into the national airline would simply ramp up the price.... and for what gain? This would only provide an increased reward those bailing out of AIR NZ!

I'm obviously missing something here...

[macduffy]

Perhaps BRICKS is holding AIR?

;)

[BRICKS]

Perhaps BRICKS is holding AIR?

;)

BRICKS knows you don't but you hold DUDS like CSR,NOD and GPG so AIR is well managed and paying DIV`s and at a current GOOD price..

NEXT paul_nz a confused junior member well as time passes for you knowledge will come
with age for free, the note you wrote is wrong and will leave it up to you to work out your next
move have a GOOD day..

[scamper]

thanks for the info, bricks.
may i also add that its clarity of structure and comprehensible message is a stunningly unexpected effort from you. wish i could follow all your posts so easily... cheers.

[BRICKS]

thanks for the info, bricks.
may i also add that its clarity of structure and comprehensible message is a stunningly unexpected effort from you. wish i could follow all your posts so easily... cheers.

Happy customers keep coming back good for BIZ and you use such big words pity there
is so much confusion in NEW ZEALAND.. Regards..

[Phaedrus]

Too many big words causing confusion?

Look at the nice clear picture!

http://h1.ripway.com/78963/AIR35.gif

[Xerof]

Yes, very nice Phaedrus

should drop like a BRICK :cool::cool:

[BRICKS]

Yes, very nice Phaedrus

should drop like a BRICK :cool::cool:

ALL that graph and you still cant work it OUT..

[Xerof]

"Bear" flag in a downtrend. After a big rout, the flag seemingly presents a chance to re-group before continuing in the same direction (down.) Volume diminishes during the pause and then rapidly expands on the continuation.

Target is usually the height of the "flagpole", so around 53 cents

[BRICKS]

"Bear" flag in a downtrend. After a big rout, the flag seemingly presents a chance to re-group before continuing in the same direction (down.) Volume diminishes during the pause and then rapidly expands on the continuation.

Target is usually the height of the "flagpole", so around 53 cents

IS there any chance that AIR will fall of the Board of the NZX..

[Xerof]

BRICKS

Someone with a greater knowledge of the NZX50 composition rules might be able to answer that - I'm only making a technical observation of its price activity, as is Phaedrus.

It could slip out of the NZX50 to become an also-ran, but I would say that while J Key is in office, it would be rated an 'iconic'

[Phaedrus]

The NZX 50 comprises the securities of the top 50 companies listed on the NZSX Market by free float market capitalisation. The free float is determined by excluding blocks of shares greater than 20% and blocks between 5% and 20% which are considered strategic.

That's not what Bricks was asking, though. I think.

[Xerof]

I understood what he was asking, but preferred not to be drawn into that sort of conversation :cool::cool:

[BRICKS]

THIS is the last chance this week to get the DIV which is over 11% yld. much better than bank interest by the way in AUS rates have crashed to there lowest most now give .5%
on savings accounts this is one reason that share buying will RETURN..

[ops.normal]

bit of a newbie question coming, but what does the sp typically do around div time?

[BRICKS]

bit of a newbie question coming, but what does the sp typically do around div time?

A share has an EX date to get the Div means you have to own on that date and bingo
the div is yours, one day later you don't get until the next div comes simple so you got till Friday.. after that the Sp mite drop or rise its up to the MARKET..

[POSSUM THE CAT]

BRICKS You are in the wrong Bank my ANZ AUSTRALIAN savings account pays 4% Better than most in NZ

[BRICKS]

BRICKS You are in the wrong Bank my ANZ AUSTRALIAN savings account pays 4% Better than most in NZ

YOU just want to hope they dont GO BROKE.. but you had better check again the
latest RATE..= ??

[POSSUM THE CAT]

BRICKS The rate is STILL 4% As the account is by invation only, I suppose they would not invite a BRICK But even Macquarie is paying more than 0.5% but most of your Broker's call accounts are paying 0.5% you think you are getting cheap brokerage but they are actually robbing you blind on your call accounts

[BRICKS]

BRICKS The rate is STILL 4% As the account is by invation only, I suppose they would not invite a BRICK But even Macquarie is paying more than 0.5% but most of your Broker's call accounts are paying 0.5% you think you are getting cheap brokerage but they are actually robbing you blind on your call accounts


BRICKS checked all of ANZ savings accounts highest was 3.65% with $100,000 in it,
your a funny man "INVATION ACCOUNT" only for KIWI`s please don't write any more RUBBISH to me and while your at it get a bundle of AIR..

[POSSUM THE CAT]

BRICKS I was An Australian Resident at the Time And Rate is not available off ANZ web site unless you have access to account. But just to show you how ignorant you about Australia's Banking System the country you say you reside in for about six months of the year. Check this Link http://www.onedirect.com.au/Apply-Now/High-Interest-Saver/ It is rather awkward for A non resident to apply for But there are a lot of others that will deal only with Australian Residents. But of course you are a BRICK and know it all like buying AIr not so long ago you were ramping Virgin.

[BRICKS]

BRICKS I was An Australian Resident at the Time And Rate is not available off ANZ web site unless you have access to account. But just to show you how ignorant you about Australia's Banking System the country you say you reside in for about six months of the year. Check this Link http://www.onedirect.com.au/Apply-Now/High-Interest-Saver/ It is rather awkward for A non resident to apply for But there are a lot of others that will deal only with Australian Residents. But of course you are a BRICK and know it all like buying AIr not so long ago you were ramping Virgin.

WHAT ever this is its not the normal account so stop wasting my time,, BRICKS dose not
ramp but tells who will listen what he thinks and AIR & VBA are good stocks which he holds
for reward.. PUSSY it stands out that your in constant MOAN mode please talk to other members about your worries and give the BRICKS the MISS..

[BRICKS]

THOSE who followed BRICKS last week are looking at a 10% gain :|"Oh what a FEELING"",
last day for div TODAY..

[QOH]

THOSE who followed BRICKS last week are looking at a 10% gain :|"Oh what a FEELING"",
last day for div TODAY..

I thought ex div day is next Monday.

[BRICKS]

I thought ex div day is next Monday.

Never say "I THOUGHT" without checking the dates where listed a a page or two back,

and your wasting our time as your not going to BUY..

[777]

Actually you are both wrong. Books close for dividend entitlement on Friday. Are quoted ex div on Monday 15th.

Bricks wrong. There's a first.

Actually QOH you were right. My apologies.

[BRICKS]

EX date 13 mar 2009, Pay date 27 mar 2009,, hurry just got time to BUY a few MORE..

Note the div will pay for the BROKERAGE.. GREAT..

Bloody Hell you KIWI`s love to bite bums over nothing get down to your brokers and BUY..

PLUS forgot 777 GPG is a DUD..

[777]

Straight from their announcement...

Details of Interim Dividend
- Record Date for Interim Dividend 13 March 2009
- Payment Date for Interim Dividend 27 March 2009

ie if you buy them by 5pm on the 13th, then the dividend is yours.

Definitely not today as per your post.

Sold at 90c a few weeks back. Bought some more NZO at 1.23.

[777]

On GPG you are right, but flicked a lot of those at $1.40+. Happy to hold the rest as still in profit on those. Just hope they are not silly enough to take a stake in AIR. Then I would be worried.

[BRICKS]

On GPG you are right, but flicked a lot of those at $1.40+. Happy to hold the rest as still in profit on those. Just hope they are not silly enough to take a stake in AIR. Then I would be worried.

SO would BRICKS..

[BRICKS]

FOR all those who worry and to all the non buyers AIA & AIR are now ex dividend and
we can now look forward to the next div coming, BRICKS will be returning to NZ on
the 25 TH March to resume trading..

As NZ was the first country to go into recession it will also the first to come out,
as well for a long time now it happens NZX in a limited way is in a good position to trade
more positive for the trader than the Australian Stock Exchange which is bloated with
share issues which will take a long time to digest so trading profits don't /wont happen
for some time so back to the NZX..

[biker]

Nice to see AIR ex div and back up to where they were on Friday. Bought some of these at 80c (cum dividend) because airlines, and esp AIR have always moved in cycles. This has to be somewhere near the bottom of this cycle or at least much closer to the bottom than the top. 80c is about 16c in the old money, or very close to the 15c Helen paid. They have been over 60c and back again since. In the event of an upturn, Air is in a better position than it has ever been for a rapid return to profitability IMHO. I think air is a classic 'buy in gloom, sell in boom' story. Airline shares of course, not without considerable risk.

As an aside, with VBA market cap less than 200mil, what of a Fyfe/Key/Branson chit chat with a view to a deal?

[Vitamin]

Why is there no sharetrader interest in AIR?
This stock has bounced over 20% in the last few weeks!
My wife who travels domestically alot says the planes are still choc full of 'Suits'.
The Company seems to be managing capacity well yet trades at a massive discount to its peers (who arguably are not run as well).
Am I flogging a dead cat or is this a hidden gem?

[BRICKS]

Why is there no sharetrader interest in AIR?
This stock has bounced over 20% in the last few weeks!
My wife who travels domestically alot says the planes are still choc full of 'Suits'.
The Company seems to be managing capacity well yet trades at a massive discount to its peers (who arguably are not run as well).
Am I flogging a dead cat or is this a hidden gem?

FEEL there is a lot of interest i AIR only the fact is you have not been following it until
now your wife by now should be a shareholder because of her inside interest in travel
remember AIR has a large capital and a large spared of holders with good constant
turnover and at the moment is on the rise AGAIN..

[Anna Naum]

Cheap vs BV but lets face it, airlines is a bad industry, so even if AIR is a good stock, its still a bad industry (Buffett I believe has some views on these sort of companies). With Qantas and AIR offering cheap deals to the USA and I see the NZ bed night data the other day was terrible, AIR might be managing the situation well but its still a bad situation. Also with the Govt owning so much, there is no chance of corporate action, albeit with Mr Key in charge you have to wonder if another JV proposal with Qantas might get a more +ve outcome.

[BRICKS]

Cheap vs BV but lets face it, airlines is a bad industry, so even if AIR is a good stock, its still a bad industry (Buffett I believe has some views on these sort of companies). With Qantas and AIR offering cheap deals to the USA and I see the NZ bed night data the other day was terrible, AIR might be managing the situation well but its still a bad situation. Also with the Govt owning so much, there is no chance of corporate action, albeit with Mr Key in charge you have to wonder if another JV proposal with Qantas might get a more +ve outcome.

WELL lets face it your a Business Class Mona, Buffet said only airlines did not suit HIS
ORG, he actually fly as well.. All airlines have competition but that is not helping
Mr Vitamin with his question and his wife who is a large flying traveler in should they BUY or not my answer to them is, YES..

[Anna Naum]

WELL lets face it your a Business Class Mona, Buffet said only airlines did not suit HIS
ORG, he actually fly as well.. All airlines have competition but that is not helping
Mr Vitamin with his question and his wife who is a large flying traveler in should they BUY or not my answer to them is, YES..

There are very few times through the cycle when airline stocks are not 'cheap'. As for a suits on a plane, the dicsounting suggests there are a lot of suits not getting on the international flights. Airline sector will remain cheap for many years to come. Like I said the only way I can see outperformance is if NZ Govt lets Qantas take a stake, thus reducing competition across the tasman and to the USA.

[BRICKS]

There are very few times through the cycle when airline stocks are not 'cheap'. As for a suits on a plane, the dicsounting suggests there are a lot of suits not getting on the international flights. Airline sector will remain cheap for many years to come. Like I said the only way I can see outperformance is if NZ Govt lets Qantas take a stake, thus reducing competition across the tasman and to the USA.

YOUR answer again is to broad we are talking about AIR not all the other airline companies
around it would be better to answer Mr Vitamin`s question direct about his EXPECTAIONS..

[Anna Naum]

YOUR answer again is to broad we are talking about AIR not all the other airline companies
around it would be better to answer Mr Vitamin`s question direct about his EXPECTAIONS..

Why invest in a company that is in a sector that is under pressure or is that not clear in my previous emails. As to advising someone else to buy or sell, there is not upside in that, or is it smart. I would suggest stating the +ve and -ve points is a better way to allow someone to make an informed choice. After all what do we know about Vitamin's investment process or financial position. You would not be suggesting that he should invest based on what you or I say are you?

[BRICKS]

Why invest in a company that is in a sector that is under pressure or is that not clear in my previous emails. As to advising someone else to buy or sell, there is not upside in that, or is it smart. I would suggest stating the +ve and -ve points is a better way to allow someone to make an informed choice. After all what do we know about Vitamin's investment process or financial position. You would not be suggesting that he should invest based on what you or I say are you?

ARE you going to make this your life story as ALL companies are under pressure which
means nothing only that THE VITAMIN asked for suggestions not investment Decisions..

[Anna Naum]

No two companies are the same, they all differ. After all not all companies pay the CEO $3m.

[Vitamin]

What I like about AIR is it's massive operating leverage.

With a largely unlevered Balance Sheet and low capex requirements, bums on seats (not withstanding some discounting) should translate into relative outperformance.

Consenus broker valuations are already well north of $1.00 and once sentiment improves and the operating environment is a little more certain, I'm sure you will see broker valuations starting with the number two.

My original post was to try and understand why this stock is out of favour relative to other stocks on this site.

My bet is this stock breaks through $1.00 per share barrier in the near term.

[Steve]

How much of the fuel surcharge is AIR still charging? Has it been reduced as fuel prices have reduced?

[Anna Naum]

What I like about AIR is it's massive operating leverage.

With a largely unlevered Balance Sheet and low capex requirements, bums on seats (not withstanding some discounting) should translate into relative outperformance.

Consenus broker valuations are already well north of $1.00 and once sentiment improves and the operating environment is a little more certain, I'm sure you will see broker valuations starting with the number two.

My original post was to try and understand why this stock is out of favour relative to other stocks on this site.

My bet is this stock breaks through $1.00 per share barrier in the near term.

One capex issue going forward is the replacement of its 737 fleet and from 2013 the arrival of its Dreamliner fleet

[BRICKS]

How much of the fuel surcharge is AIR still charging? Has it been reduced as fuel prices have reduced?

WELL steve BUY a ticket and find out..

anna naum four years down the track is a long time ahead any thing mite happen so not to
worry that much, BUT AIR will be able to handle it EASY..

[Neo-Con]

I don't think there is any question AIR is a bargain at the moment. Sure, airlines overall are underperformers and generally I would not be expecting airlines (including AIR) to neccessarily earn an acceptable return on equity, but AIR is trading at such a heavy discount to its equity (equity 1.7b, market cap 1b) that when you look at the return available on the current share price it looks very good indeed:

Look at earnings:
2008: $218m (hardly in great conditions, oil up at $150 a barrel etc)
2009: $80m (likely result, $24m half year, mgmt expect second half NPAT to be multiples of half year result as per Rob Fyfe at results presentation)

As a go forward I think allowing for some volatility due to the nature of the industry it is reasonable (and conservative) to assume average profits around the $150m mark. Applying typical historical earnings multiples for NZX companies of around 15 (which should be restored once this recession washes over) that gives us a market cap of around $2.3b (compared to current of $1b).

I am not expecting this move overnight but I think $2.30 is a reasonable 12 - 18 month target price. Even if the price doesn't move this way, shareholder can sit comfortably on this stock given the strong dividend yield.

The talk about AIR capex coming up is just part of its business. There are always going to be some planes coming near the end of their life. AIR however has a very light capex profile this year. It will resume to normal once the new long haul fleet is introduced.

This is something of a non-issue for AIR given the $1.4b sitting on its balance sheet. And of course capex is all built into valuations based on earnings because of depreciation charge.

Disc: AIR

[Steve]

WELL steve BUY a ticket and find out..

Bricks, good suggestion, however it would be easier for me if a frequent traveller such as yourself could look at their last ticket, or do you no longer fly with AIR? :D

[BRICKS]

Bricks, good suggestion, however it would be easier for me if a frequent traveller such as yourself could look at their last ticket, or do you no longer fly with AIR? :D

What would be better for me is for you to direct your questions some where else or go direct
to the web site and LOOK..

[Vitamin]

So, AIR breaks through the $1.00 per share mark. Depth looks good and once there is any sign of positive earnings momentum, I'm sure you will see Broker's valuations go through the roof.

[BRICKS]

So, AIR breaks through the $1.00 per share mark. Depth looks good and once there is any sign of positive earnings momentum, I'm sure you will see Broker's valuations go through the roof.

DID you BUY some after all this TALK..

[AMR]

Phaedrus, do the longer term trend following indicators suggesta trend change yet?

[Vitamin]

Trend change? Well, the share price has increased nearly 40% since early March '09 and depth is building at current levels. So, maybe?

[boxing_beaver]

gotta be careful here, the outlook for airlines is dreadful right now, one only needs to look at Qantas as an example of a well run airline in financial strife. air nz has been publicly confident about maintaining profitability, and may be in a position to capitalize on the downsizing of other airline services. But at the same time air nz is still vulnerable to further deteriorating market conditions.

[BRICKS]

DID you BUY some after all this TALK..

Vitamin,STICK to a trend and you missed the BOAT..

Young Beaver Qantas has only its self to blame too MUCH DEBT and buying too many
planes the company is out of whack and caught in a DOWN TREND..

[Vitamin]

Check out the depth on AIR!

The stock has had a massive run over the last month on good volume.

Looks as though there is still considerable interest at current levels.

Do any sharetraders have any price targets for this stock?

[AMR]

Check out the depth on AIR!

The stock has had a massive run over the last month on good volume.

Looks as though there is still considerable interest at current levels.

Do any sharetraders have any price targets for this stock?

A long term target based on overhead resistance? ~$3.

I still reckon VBA has more potential, technically a lot more oversold and overhead resistance much further away. AIR looks due for a pullback to touch 95c again in the medium term (where I will load up and leave it)

According to the chart
Short term target at 1.40
Long term target at 3.20
Good chance of a reversal back to 95c these few weeks although risk to reward seems good for longer term investors

[Vitamin]

AMR, many thanks for your view and price target on AIR.

AIR has certainly had a great run of late - not too many billion dollar companies attract such little interest with Sharetraders despite increasing over 40% in not much more than a month!

Lets hope your views and, more importantly, price targets come to fruition.

[Phaedrus]

(17/4/09) Phaedrus, do the longer term trend following indicators suggest a trend change yet? Sorry about the late reply AMR - I hadn't noticed your query and have been away for a few days.

I presume you are referring to the longer-term indicators as featured in this (http://www.sharetrader.co.nz/showthread.php?p=242422)post. These began firing on 13/3/09 when the slow Stochastic oscillator gave a Buy signal at 89 cents and had all given Buy signals in the weeks before your query. The sole exception here is the OBV. This entire turnaround has been on low volume and consequently the OBV is still flat-lining. This doers not auger well for the future of the latest uptrend and holders would be well advised to keep this one on a fairly short leash, selling on a break of the current trendline, for example.

http://h1.ripway.com/78963/AIR427.gif

[Anna Naum]

JETSTAR boss Bruce Buchanan has called on politicians on both sides of the Tasman to increase efforts to set up a common border between Australia and New Zealand and help lower costs and boost economic growth.

Mr Buchanan believes such a move would lead to trans-Tasman fare reductions of at least 30 per cent, or $60 a passenger one-way, as well as stimulate the economies of both nations.

It would also boost jobs and decrease costs for both industry and border security agencies, he told a Trans-Tasman Business Circle lunch in Melbourne yesterday.

"At a time when both Australian and New Zealand economies are in technical or real recessions, and jobless numbers are escalating at the fastest rate in decades, surely this is the time to solve this problem," he said.

[Vitamin]

Phaedrus, you certainly picked AIR right in taking a breather from its recent rally. It's off its short term high but still seems like it has reasonable support. Any trend indicators showing up?

[Phaedrus]

Vitamin. Technically, AIR is still in an uptrend - it would take a Close of below $1.01 to end this. The trendline that was in place has been broken and nervous holders would perhaps have exited at that point, although this was an isolated, unconfirmed signal. The usual thing now is to draw a new trendline taking in the $1.01 low. (Light green).
The three conservative indicators at the top of the chart are nowhere near triggering sell signals, but you should understand that these are lagging indicators and as such will be slow to trigger.
Note that the OBV is still flat-lining. There is still no significant volume behind this uptrend.

http://h1.ripway.com/78963/AIR510.gif

[Anna Naum]

From todays paper....Air New Zealand could be in merger talks with another airline by the end of the year as the recession and increased competition threatens its long-term viability, a leading industry think tank says

[BRICKS]

From today's paper....Air New Zealand could be in merger talks with another airline by the end of the year as the recession and increased competition threatens its long-term viability, a leading industry think tank says

BRICKS heard the same rumor from a AIR hostess on the plane when coming over from Ozzy
back in April but to NO avail but she was adamant..

[biker]

.......As an aside, with VBA market cap less than 200mil, what of a Fyfe/Key/Branson chit chat with a view to a deal?

Making more and more sense?

[Jaa]

I think AIR NZ have already learnt their lesson in Australia :eek: !!

Their current strategy is clear, they only want to fly routes where they are number 1. Possibly they will also fly a route as a close second if the number 1 is a non Star Alliance airline, but I can't think of any except perhaps, Auckland - Hong Kong? Hence why they bailed out of Auckland - Singapore a few years ago.

Why buy an airline (VBA) thats only ever going to be number 2 on a whole bunch routes in a whole country?

[biker]

Note that the OBV is still flat-lining. There is still no significant volume behind this uptrend.



There have been some quite large volumes traded over the last 3 weeks. More over that time than any equivalent period in about 9 months.

[Phaedrus]

We are talking about 2 different things, Biker. You are talking about total volume. I was talking about "volume behind the uptrend". Translation :- Volume on UP days minus volume on the Down days. You can see that in the period you mention, the biggest volume day by far was a down day. (Red bar). This was volume against the uptrend.

Your observation is accurate though - total volume is clearly rising.

http://h1.ripway.com/78963/AIR513.gif

[Vitamin]

April statistics again showed that AIR is more than matching falling passenger numbers with capacity reductions.

This is how one broking company summarised AIR:

"No change in view at this stage as AIR continues to match capacity with demand. Valuation currently NZ$1.42 and rating OUTPERFORM."

[BRICKS]

April statistics again showed that AIR is more than matching falling passenger numbers with capacity reductions.

This is how one broking company summarised AIR:

"No change in view at this stage as AIR continues to match capacity with demand. Valuation currently NZ$1.42 and rating OUTPERFORM."

Don'T believe BROKERS ever young Vitamin they will say anything to make a sale as turnover is the name of there game, But if you hold and you want your share to rise it is getter to hear them say UP than DOWN..

[BRICKS]

BRICKS flies back to OZZ next Wednesday AIR only has one flight that day from
Wellington and the plane is still not FULL..

[Bobcat.]

Your observation is accurate though - total volume is clearly rising.



Phaedrus (and others);
How do you see this stock now? AIR's management has never been better and they seem to be managing adverse financial impact of falling passenger loads with smart reductions in capacity (see their last monthly update for May).

I bought into it last Friday afternoon after comparing its recent slide against that of other airline stocks. Here for example is the sp compared against Qantas (brown). I'm guessing the selloff was due mainly to British Airways' awful financial report (their largest loss ever). 6m in AIR volume on Friday was enough to trigger my interest.

Your view?

[biker]

........
As an aside, with VBA market cap less than 200mil, what of a Fyfe/Key/Branson chit chat with a view to a deal?

I can only agree with the following.......



Air N.Z., Virgin Blue Should Consider Tie-up, Macquarie Says
Share | Email | Print | A A A

By Robert Fenner

June 24 (Bloomberg) -- Air New Zealand Ltd., the nation’s biggest airline, should consider an alliance with Virgin Blue Holdings Ltd. to cut costs and create a stronger competitor to Qantas Airways Ltd., analysts at Macquarie Group Ltd. said.

A tie-up, through a takeover or “significant” investment by Air New Zealand in Virgin Blue, would improve profitability on routes and save money by eliminating duplicated engineering and maintenance functions, analysts led by Russell Shaw said in a note to clients today.

Virgin Blue, Australia’s second-largest carrier, is battling losses from its startup of flights to the U.S., while the airline’s domestic market share is threatened by larger rival Qantas, Macquarie said. Auckland-based Air New Zealand last month announced it will cut capacity and fire workers amid slumping demand for business and leisure travel.

“With both airlines struggling in the current environment, we believe a merged entity or even some level of corporate investment by Air New Zealand in Virgin Blue would give these carriers improved longer-term prospects,” Shaw wrote. A combined company “would stand a far greater chance of remaining competitive against regional powerhouse Qantas longer term.”

Macquarie maintained its “neutral” rating on Air New Zealand and “underperform” recommendation for Virgin Blue.

Heather Jeffery, a spokeswoman for Virgin Blue, didn’t immediately return calls seeking comment on the Macquarie report. Air New Zealand’s media office didn’t return a voicemail from Bloomberg today.

Government Stake

Virgin Blue shares fell 1.7 percent to 29.5 Australian cents at 11:58 a.m. in Sydney. Before today, the stock was unchanged this year. Air New Zealand shares were unchanged at 91 New Zealand cents in Wellington.

Selling new shares to fund the deal may also dilute the government’s 75 percent stake in Air New Zealand, making it more attractive to domestic and foreign investors, Macquarie said.

Sydney-based Qantas and Air New Zealand scrapped plans to share flights across the Tasman Sea in 2006 after objections from Australia’s antitrust regulator.

Macquarie doesn’t expect an Air New Zealand tie-up with Virgin Blue to face the same opposition given Qantas remains a competitor on domestic routes in both countries. Still, any deal may still face hurdles such as foreign ownership restrictions, trade union objections and Richard Branson’s 25 percent stake in Virgin Blue, Shaw wrote.

“We don’t view any of these as being insurmountable obstacles to getting a corporate deal across the line,” Shaw said.

To contact the reporter on this story: Robert Fenner in Melbourne rfenner@bloomberg.net

Last Updated: June 23, 2009 22:59 EDT

[Vitamin]

I have read Macquarie's research note.

I can't see any merger/equity injection happening given the current global economic environment and the hangover from AIR's Ansett foray.

From what I read, airlines are in survival mode. With AIR's undemanding gearing, it should emerge the strongest once passenger numbers turn.

Meanwhile Jetstar continues to shoot itself in the foot in NZ.

[Tee]

Passenger numbers are on the decline, and Jetstar will be competing strongly in the low-fare sector. Sometime back, I had an attack of nerves and sold my AIR shares at 83 c- I believe that it was the lowest that it got to then.
Now trading at 90 c. Its on my watchlist and QAN too.

[macduffy]

Speaking as one who made money; lost money; lost money on Air NZ - admittedly several years ago, I'm convinced that there's easier ways of making money than investing in airline stocks.

;)

[winner69]

Been plenty of ups and downs eh Mcduffy

Late 2001 was the collapse of AIR and the govt bailed it out

The lowest the shareprice got was 78 cents (act 16 cents but been a consolidation since) but got backed to 140 in January 2002 when the govt pumped heaps of money in

Hard to imagine that once this great company had a share at $17 (in 1995) and even in the month it collapsed the shareprice started off over $4 .... $4.64 to 78 cents in a week or so was some drop.

Amazing that 8 years later the shareprice is not far off it's all time low ... even though it reached $3.60 odd once


Looks like the govt is under water on its investment ... even witht he dividends ... don't say much about that do they?

Yep macduffy ... agree with you there's easier (and less risky) ways to make money than AIR

[winner69]

If Qantas is as stuffed as this article says one would have think that AIR is stuffed as well ... maybe not as stuffed but stuffed

Qantas not being totally transparent .... May performance awful apparently ... (Quote) The passenger figures Qantas released to the stock exchange yesterday weren't flash - but the unannounced financial reality was much, much worse. ........ While Qantas told the ASX its May Qantas International and Jetstar International revenue seat factors were up 4 and 4.8 percentage points respectively, it didn't say that its yield on the combined international business had collapsed by 25 per cent.

The yield - the average price paid by the distance flown - points to the extent of fare discounting rampant on international routes and provides a more meaningful indication of how the bottom line is faring.
.....As a 1970s professor of statistics allegedly used to tell his class: "Statistics are like a bikini, ladies and gentlemen. What is revealed is suggestive, but what is concealed is vital."

http://business.smh.com.au/business/qantas--its-worse-than-it-looks-20090701-d4lp.html

[Vitamin]

After trading up to $1.12 per share AIR has tracked back down to under $0.90 per share.

Sold some around $1.10 per share and now thinking I might try a short term trade again.

Phaedrus, any thoughts on short and medium term trading of this stock?

[Phaedrus]

Here are 8 suggested short/medium term indicators that could be used to signal entry into AIR.

http://h1.ripway.com/78963/AIR78.gif

[Tee]

I find charts very challenging. And not being able to understand it well, have not used it for my own trading (part-time). And yet I believe that it is being used in automated program trading applications.

The closest to programmed trades that I can get is to place these orders:-
1. BUY AIR @ 82 c and 2. SELL AIR @ 86 c.

[Tee]

"I'm convinced that there's easier ways of making money than investing in airline stocks." by macduffy

Yes the return on investment is low (Warren Buffet made some comments about this).

And gosh I never knew about the historical highs and lows of AIR.

[winner69]

Air New Virgin on the way

http://www.businessspectator.com.au/bs.nsf/Article/BREAKFAST-DEALS-Virgin-marriage-pd20090714-TWTNY?OpenDocument&src=sph

The body painted Air NZ people will all of a sudden be an attraction if we have body painted virgin girls

[BRICKS]

Air New Virgin on the way

http://www.businessspectator.com.au/bs.nsf/Article/BREAKFAST-DEALS-Virgin-marriage-pd20090714-TWTNY?OpenDocument&src=sph

The body painted Air NZ people will all of a sudden be an attraction if we have body painted virgin girls

W69 of late you write up`s have increased a large amount with plenty of things happening
good for a MOAN its must be FUN for you..

As to your paper report is a load of RUBISH there is NO reason for AIR to do anything silly like getting Married and to a Virgin just fill in paper talk,, and for your information the
LNN deal never, never gets any sort of mention in AU again just NZ paper TALK..

Have a GOOD day.. BRICKS..

[macduffy]

An interesting discussion on Radio NZ ( or whatever it's called these days) just finished, on airlines, especially the NZ scene.
Commentators were very positive on Air NZ.

Good listening but I don't invest in airlines.

;)

[BRICKS]

[QUOTE=macduffy;265113]An interesting discussion on Radio NZ ( or whatever it's called these days) just finished, on airlines, especially the NZ scene.
Commentators were very positive on Air NZ.

Good listening but I don't invest in airlines.

IF you don't BUY airlines WHY do you keep telling US..

[BRICKS]

THE tourist figures are down wonder why AIR is only flying one plane a day Sydney to Wellington
NO wonder on the numbers on Sundays they are booked out months ahead so just have catch QANTAS..

[Tee]

Despite the negative news i.e. a lower number of passengers, swine flu, competition from jetstar....:)

[scamper]

I rather like the way the 90-day moving average is inching upwards for the first time in two years, but then, it is off a seriously sick base.
Good to see the price poking through the top bollinger band too, although this has happened 5 times during the same period -- to short-term effect only.
waiting for the trendline break -- moving average crossover would be good as well -- decent volume ditto.

[Phaedrus]

...waiting for the trendline break... Good on you Scamper. AIR is in a fairly steep uptrend just now, but we all know that every uptrend ends sooner or later. When the time comes to sell, your trendline break is likely to be one of the first indicators to be triggered, but there should be plenty of confirmation at around the same time from the other indicators shown here.
This is an update of the AIR chart posted 3 weeks ago (previous page, post #418). It features the same indicators and time periods. All have worked very well indeed, giving reasonably early signals fairly close together.
Why so many indicators? Primarily to show that there is more than one way to skin a cat. There is no "ideal" indicator and each and every one has its own strengths. weaknesses and characteristics. The fact is that anyone, using any of these indicators, would have traded AIR quite efficiently. They all work well. As you would expect, acting on the first signal to trigger gives the best results, but it is generally considered more prudent to wait for confirmation from a second indicator before buying or selling.

http://h1.ripway.com/78963/AIR729.gif

[Sideshow Bob]

Air NZ shares expected to soar
By DENISE McNABB

In a report Marcus Curley said Air NZ was poised to soar out of the gloomy world environment next year and its share price was likely to rise to $1.35 in the next 12 months and then jump to $1.70 a share.

His forecast is made on the basis of the airline being shielded from oil price rises, international passenger numbers looking likely to increase in the next quarter from -4 per cent to 3 per cent next year and stabilising economic growth in New Zealand during the past three months.

His prediction is in contrast to his colleagues Andrew Gibson and Andrew McCusker's take on a A$231 million (NZ$290m) capital raising announced on Monday by Australia's second-biggest carrier, Virgin Blue, parent of New Zealand carrier Pacific Blue.

Air NZ said the long-speculated capital raising would improve liquidity but the analysts said they were concerned about the risk of prolonged losses from V Australia if conditions remained challenging.

Macquarie Equities analysts Russell Shaw and Riaz Hyde questioned whether the capital raising, diluting existing shareholders' stakes by 49 per cent, was necessary just to improve liquidity when the company was predicting a near break-even performance next year after a A$160m-A$165m loss this year.

They did, however, think the entry price of A20c a share was attractive.

http://www.nzx.com/print/2685055

[Vitamin]

I've been following all of the Broker reports and Marcus Curley, until recently, was negative on AIR so it's a sea-change to now see such a bullish report.

The stock has rallied well over the last few days, so, maybe it's the start of something big?

[NOCASH]

Hope this will be a well done stock, brought in at 1.07 with my student overdraft interest free money, $2000.

[BRICKS]

MY friend is flying back this week end and when she checked her seat she had been allocated a aisle seat when she asked for a window seat NO worry`s it can be allocated
but it cost`s $15 CAN., just little things to COME...

[BRICKS]

MY friend is flying back this week end and when she checked her seat she had been allocated a aisle seat when she asked for a window seat NO worry`s it can be allocated
but it cost`s $15 CAN., just little things to COME...

WELL she just left TORONTO headed for LA be interesting to know if she has been able to swap for a window seat and beat the $15 CHARGE..

[BRICKS]

WELL she just left TORONTO headed for LA be interesting to know if she has been able to swap for a window seat and beat the $15 CHARGE..

THE situation was that the plane totally full moving seats was out of the question
so just GO with the flow,, update now sitting in AULK DOM waiting for the last leg to
WELLINGTON.....

[Vitamin]

I see another Broker's report is very bullish on AIR, with a 12 month price target of $1.50 per share and a DCF valuation of $1.83 per share:

"Our target price of NZ$1.50 (1x P/B) is unchanged, although forecast revisions boost our DCF valuation to NZ$1.83 (previously NZ$1.43). We think AIR remains in a strong position with minimal near-term capex requirements, net cash and moderate gearing of around 50% (operating leases at 7x). We view AIR as a trading stock for less cautious investors, given the super-cyclical nature of the sector. On our estimates, AIR is trading around 0.73x P/B relative to QAN on around 1x P/B."

Certainly looks cheap compared to its competitors. Let's hope the rally continues :)

[BRICKS]

I see another Broker's report is very bullish on AIR, with a 12 month price target of $1.50 per share and a DCF valuation of $1.83 per share:

"Our target price of NZ$1.50 (1x P/B) is unchanged, although forecast revisions boost our DCF valuation to NZ$1.83 (previously NZ$1.43). We think AIR remains in a strong position with minimal near-term capex requirements, net cash and moderate gearing of around 50% (operating leases at 7x). We view AIR as a trading stock for less cautious investors, given the super-cyclical nature of the sector. On our estimates, AIR is trading around 0.73x P/B relative to QAN on around 1x P/B."

Certainly looks cheap compared to its competitors. Let's hope the rally continues :)

BUT brokers are always pushing something they need the BIZ,, But AIR is a good all round bet for them as the NZX lack any depth so the hope is now on the BUYERS..

[The Great Gold Guru]

I did a day trip down to Christchurch yesterday from Auckland on Jetstar... plane down was the 6.40am departure , about 1/2 full I would say , flight back was 6.35pm which was maybe slightly busier. Return fare was $58 !! ... Hard yakka to make money in the airline market in NZ at present. Nice brand new plane , ontime both ways. Air NZ fare on similar time flights was $398 !!!

[Vitamin]

AIR closes at 1.18 per share, up 8 cents this week alone!

No doubt fuelled by the latest broker report.

We now have two brokers valuing the shares at $1.35 and $1.50 per share respectively.

So, hopefully more to come.

What do the techies think of the rally and depth?

[BRICKS]

AIR closes at 1.18 per share, up 8 cents this week alone!

No doubt fuelled by the latest broker report.

We now have two brokers valuing the shares at $1.35 and $1.50 per share respectively.

So, hopefully more to come.

What do the techies think of the rally and depth?

Dear Vitamin you seem to place a lot of faith in unstated brokers reports could you name them and then we mite know the size of there client base in which mite have some influence on the market but as AIR is a BUY at the moment why worry about BROKERS..

[Zaphod]

I did a day trip down to Christchurch yesterday from Auckland on Jetstar... plane down was the 6.40am departure , about 1/2 full I would say , flight back was 6.35pm which was maybe slightly busier. Return fare was $58 !! ... Hard yakka to make money in the airline market in NZ at present. Nice brand new plane , ontime both ways. Air NZ fare on similar time flights was $398 !!!

Paid $39 for the same flight recently on AirNZ, so perhaps not an entirely fair comparison. Still, they'll both be losing money on those fares.

[modandm]

broker reports are

aspect huntly 1.35 - forsyth barr 1.50 and goldman sachs 1.80.

Factors:

air nz should benifit from continued weakness in USD as a net usd buyer. Will be approaching policy maximums in oil hedge @ 70bbl.

superior management and fleet on the international front - more 777s on the way
continue to be a bloodbath transtasman - rotorua will be good - asians fly into auckland out of rotorua on their nz aussie travels
air nz continue to be strong domestically especially on non - trunk lines
flew to napier yesterday from auckland $170 return similair. no choice no likely competition to enter
new aia management also more air friendly

perhaps the government will ask for a div out of air nz soon - especially as the 787s continue to be delayed.

overall lots of good reasons for air sp increase. Instos are buying.
retail wise i think most investors are pretty adverse to owning airlines based on classical thinking of airlines as dogs.

interesting to see how this plays out. For me it will be from the sidelines:D

[777]

Quote: "perhaps the government will ask for a div out of air nz soon - especially as the 787s continue to be delayed"

The government gets a dividend out of AIR every six months, along with all the other shareholders.

[modandm]

thanks for that

im talking a special div. Not to many co's out there sitting on nearly 2bn with no takeover targets

[Vitamin]

Macquarie have issued a research note this morning valuing AIR at $1.51 and 'Outperform'.

There's a strong chorus now of positive research on this company.

Nice.

[POSSUM THE CAT]

Vitamin A question are Macquarie holding a lot of Air they wish to sell?

[Phaedrus]

About time! The "ignorant" market changed its sentiment towards AIR at around 85 cents. Now it is $1.20+ the Bullish reports arrive! Don't those guys use TA at all?

http://h1.ripway.com/78963/AIR814.gif

[winner69]

Phaedrus - you just don't get it mate .... somewhere else somebody said that the techos follow the fundies .... the fundies find value and then the techo jump on board

Are you saying that's not the case -- naughty naughty

[Phaedrus]

W69, if I were of a cruel and vindictive nature I would post charts showing exactly where ST fundies were buying! And that's not the half of it - these guys are staunch. They held right through the big slide......

[Vitamin]

With VBA most likely off AIR's radar now, what's the chances of AIR announcing a special dividend when it announces its full year result next week?

[macduffy]

Havn't seen any report of this in the local press, yet.

http://business.smh.com.au/business/cartel-case-link-to-air-nz-chief-20090823-ev2j.html

[Dusty]

Havn't seen any report of this in the local press, yet.

http://business.smh.com.au/business/cartel-case-link-to-air-nz-chief-20090823-ev2j.html

Its on the Stuff website sourced from The Age but with its ties to the Dom Post I presume it will be in today's issue.

http://www.stuff.co.nz/business/market-data/2780648/Air-NZ-deputy-linked-to-cartel-case

[modandm]

any1 got any opinion on sp direction of air sp over coming weeks

currently holding and thinking of selling - closed slightly higer today at 1.26

cheers

[Phaedrus]

It looks as though AIR will crab sideways for a while - it is in a trading range.

The attached chart shows 6 indicators and their associated buy/sell signals. You can see that 4 of them have triggered Sell signals.

In your position of having held through those Sell signals, I would be inclined to make my Hold/Sell decision on the eventual trading range breakout. A break above the resistance at $1.29 would be a Hold, a break below the support at $1.22 would be a definite Sell. If you don't like such an "open ended" situation, you could sell if/when the remaining 2 indicators fire.

http://h1.ripway.com/78963/AIR99.gif

[modandm]

thanks p nice chart - was interesting that the poor results announcement seem to have slowed but not stopped or reversed (up another cent today) the uptrend which was in place. Although as you say it is in a bit or a trading range right now.

does a sp in a trading range statistically most break out to the side of the prior trend? This is what i am hoping obviously. Also AIR is coming up to ex div on monday - how does this affect the support resistance levels? Especially say if one has stops in place.

[Phaedrus]

Does a sp in a trading range statistically most break out to the side of the prior trend? 69% of Trading ranges that are preceded by an uptrend breakout to the upside. With odds like that it is obviously not something you can count on. Note that the last AIR trading range broke down.


AIR is coming up to ex div on monday - how does this affect the support resistance levels? The usual practice is to correct for the dividend. This is done by subtracting the amount of the dividend from all historical prices up to the point the share goes ex. Thus there is no "step" in the price plot. All reference points move by the amount of the dividend, but all patterns etc are preserved.

[kizame]

Pheadras a question. You seem to customise the time periods in your stochastic oscillator,how do you arrive at the time periods you use?
Do you fiddle until it fits,or do you have standard time periods you use?

Thanks.

[Phaedrus]

I've been using 22 and 100 day Slow Stochastic oscillators on AIR for so long that I can't remember how or why I initially selected these values. Maybe they gave good results on back-testing.

My overall aim is to run a suite of indicators of different classes with their time periods selected such that they are all of approximately equivalent sensitivity. You can see that the 22 day Stochastic as plotted here is less sensitive than the other featured indicators - it's signals tend to lag behind the rest. It would give better correlation with the other indicators if its period was shortened. This would see it too as having triggered a Sell signal recently.

There is nothing sacrosanct about the 22 day period as charted here. In actual fact, since AIR's reversal early this year, a 14 day period has worked a lot better, giving signals nicely in synch with the other 5 indicators.

[Vitamin]

Ok, I know the cynics will say that Goldmans are pushing AIR for their own benefit but their Analyst's latest report focuses on tourism flows and the positive impact to AIR:

"A full review of our tourism flows suggests the next 12 months should produce one of largest improvements in demand for NZ international air travel in the last 20 years. We expect 'system' in- and out-bound passenger volume growth to recover from -2% in 2009 to +4% in 2010. We have increased our EBIT estimates by around 4% due to slightly higher load factors, driven by improving demand for international air travel, plus a stronger NZ$. Combining both P/Book Value and P/E metrics suggests AIR is the cheapest major mainline airline in our global peer group. We reiterate our Buy recommendation based on our expectation for the third most substantial improvement in NZ international passenger growth in the last 20 years creating a strong platform for operating profit growth and further share price outperformance in FY10. In addition, AIR has attractive relative and absolute valuation metrics and a robust balance sheet".

[BRICKS]

Well in NZ AIR is a stand out bet as for the rest make your own judgment , BRICKS picked
up his DRIP shares and cant stop smiling as the world markets are now on the mend
a select few will gain and AIR is ONE...

[modandm]

hmm belg, well yes.

More importantly what is the cause of AIR's recent spike - 120-130 and is this the start of a new trend?

I am on the sidelines thinking of booking a seat.

It seems AIR is still undervalued vs its competitors (QAN VBA) however from recent operating figures AIR has still not started to grow in terms of seats sold. It is possible that revenue is higher though we will find out towards end of feb with the interim report. I am thinking of a purchase in the lead up to this.

Any opinions - and yes I know what brokers are valuing it so thanks :rolleyes:

[percy]

hmm belg, well yes.

More importantly what is the cause of AIR's recent spike - 120-130 and is this the start of a new trend?

I am on the sidelines thinking of booking a seat.

It seems AIR is still undervalued vs its competitors (QAN VBA) however from recent operating figures AIR has still not started to grow in terms of seats sold. It is possible that revenue is higher though we will find out towards end of feb with the interim report. I am thinking of a purchase in the lead up to this.

Any opinions - and yes I know what brokers are valuing it so thanks :rolleyes:air are very good at matching loads to aircraft.ie most flight pretty much full.
should demand fall they run fewer flights.

[rpcas]

______________________________

[scamper]

Flamin' Norah!
rpcas -- have a look at a five-year chart. AIR has never been a long-term hold except for the extremely stupid Like Me!! I can't even remember when i first bought, but have been in and out several times, never to great profit, and still have a pawful.
When i confess particularly dodgy sins to a share-knowledgable friend, he always consoles me with some percentage reference to the the stupidity of owning AIR...

There is a received wisdom re shares that swim, fly or grow -- avoid unless you know the industry. imho the words long-term hold and AIR should never go together.
Scamper learns the hard way, cheers.

[JK.]

Hi guys

I rely heavily on TA as a rule, but if ever I were tempted to the fundie ways, it'd be with AIR. The people in charge are remarkably good at what they do and there is a huge amount of work going on behind the scenes. To compare NZ with the other big players, I would note a string of good decisions which should set them apart, from marketing to innovation to fleet composition. Don't forget the regional monopoly: It's a major earner where the Tasman and International is a little soft.

I'd be keen to compare notes with any TA guys on the current situation. I would guess (tentatively, not sticking my head above the parapet) that AIR is still in the trading range, but flirting with the upper limit, and if it pops up through 1.36ish the next lot of resistance isn't until 1.48 or thereabouts.

Cheers
JK

[BRICKS]

BRICKS returns to NZ 29th April for his winter short break,, just received latest drip again which makes the numbers grow AIR a well run company the plane fare back is $80 dollars for 2
cheeper than QAN..

[Anna Naum]

Air New Zealand response to media speculation

Air New Zealand today became aware of media speculation that it is in discussions with Virgin Blue regarding a potential trans-Tasman alliance.

Air New Zealand confirms that the airlines have been in ongoing discussions for several months but no agreement has been reached.

Air New Zealand will not comment further on speculation related to these discussions but will advise markets as required if an agreement is concluded.

[Hoop]

Air New Zealand response to media speculation

Air New Zealand today became aware of media speculation that it is in discussions with Virgin Blue regarding a potential trans-Tasman alliance.

Air New Zealand confirms that the airlines have been in ongoing discussions for several months but no agreement has been reached.

Air New Zealand will not comment further on speculation related to these discussions but will advise markets as required if an agreement is concluded.

GENERAL: AIR: Air NZ annouces Trans-Tasman Alliance Proposal Media Release 3 May 2010 Air New Zealand and Virgin Blue Airlines Group Announce Trans-Tasman Alliance Proposal AUCKLAND and BRISBANE, 3 May, 2010 - Air New Zealand Ltd (NZSX: AIR) and Virgin Blue Airlines Group (ASX: VBA) have today announced their intention to seek regulatory approval to create an alliance on the trans-Tasman. The proposed alliance will allow the airlines to strengthen their competitive offering on the trans-Tasman and to collaborate on future route and product planning, code sharing and frequent flyer programme benefits. Air New Zealand and Virgin Blue have had trans-Tasman teams working on the alliance proposal for some months and will file applications with the Australian Competition and Consumer Commission and the New Zealand Ministry of Transport. The regulators are expected to take around six months to review the applications prior to authorisation. Co-founder and Chief Executive......read more (https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=2501330)

One would have to question why they released the 28th April announcement, 5 days before the official agreement news release ....... We now know it obviously wasn't speculation .....This rumour had been circulating for weeks...

However... well done Air NZ

[macduffy]

One would have to question why they released the 28th April announcement, 5 days before the official agreement news release ....... The rumour had been circulating for weeks...
However... well done Air NZ

One would have to give them the benefit of the doubt and assume that agreement had in fact not been reached on 28 April.

But the continuous disclosure rule would oblige them to respond to rumours in the market.

No other option.

[Anna Naum]

The part I find funny is them suggesting that this alliance would result in lower prices for flights. How stupid do they think we are, less competition does not result in lower prices. It might result in lower costs but to believe that will be passed on to consumers is a joke.

[Sideshow Bob]

I'm with you AN and I didn't understand it - they did mention a 10% reduction for 'SOME' fares....

[mr.needs]

I'm with you AN and didn't get understand - they did mention a 10% reduction for 'SOME' fares....

I was also thinking the same thing. Couldn't work out how 2 competing airlines could work together to save the consumer money. I wonder how Jetstar (Qantas) is feeling...

[Tee]

I have held AIR shares before, at the current price, it does not look appealing.

[Jaa]

Can't help but be impressed by a company with the balls and style to do this:

http://www.dearlistener.co.nz/

[peat]

http://img205.imageshack.us/img205/8743/bollocks.jpg (http://img205.imageshack.us/i/bollocks.jpg/)
Uploaded with ImageShack.us (http://imageshack.us)

lol

[peat]

She's the sign language consultant (?) for South Pacific Pictures I think.

[Jaa]

Back to the future today with rumours in the Aussie press and thankfully a denial that Air NZ is interested in an equity stake in another struggling Australian airline, Virgin Blue.

http://www.smh.com.au/business/air-nz-mulls-15-share-of-virgin-blue-20100715-10cno.html

[BRICKS]

Back to the future today with rumours in the Aussie press and thankfully a denial that Air NZ is interested in an equity stake in another struggling Australian airline, Virgin Blue.

http://www.smh.com.au/business/air-nz-mulls-15-share-of-virgin-blue-20100715-10cno.html

NO, way that AIR would front up with say $100 million just to say we own 15% of VBA and not have that much say
in running the biz these people that write papers are strugling to stay in WORK..

[CJ]

Agree - I dont think the government would approve that level of spend.

[percy]

NO, way that AIR would front up with say $100 million just to say we own 15% of VBA and not have that much say
in running the biz these people that write papers are strugling to stay in WORK..

AIR need an Aussie feeder airline.If you fly from Hobart with Qantas or Jetstar to Sydney they are not going to put you on an AIR plane to Auckland.The other way round AIR can act as a feeder for an Aussie airline.Virgin Blue are stuffed in NZ and AIR will be stuffed in Aussie unless they do a deal with VB.More at stake for AIR. No Aussie feeder means little or no growth for AIR.
I see a deal were VB stops flying within NZ and AIR does not fly withini Australia,but both still keep flying the Tasman.

[Jaa]

More good news for Air NZ today with the share price building off its lows in the last few days.


Annual visitor arrivals to New Zealand hit the 2.5 million mark last month for the first time, says Statistics NZ.

This bit is especially relevant for Air NZ with their focus on North Asia.


June visitor arrivals were up 8 per cent from the same month last year, with more people arriving from Australia and a recovery in numbers from China, Japan and Korea. Arrivals from these countries in June last year were particularly hit by the H1N1 pandemic.

"There is also a clear sign of Asian arrivals rebounding from swine flu- induced weakness, with Korean, Chinese and Japanese arrivals up 33 per cent year on year," he said.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10660234

[Jaa]

The world's best airline has seen off another airline. I was picking VBA to stick around till after the world cup next year but seems they saw the writing on the wall with the arrival of Air NZ's new domestic A320 fleet next year.

Seem to be in a hurry to get out too, giving only 2 months warning. Aircraft to be re-deployed on to the Tasman and back to Aussie no doubt.

Pacific Blue pulling out of NZ domestic flights
http://www.stuff.co.nz/business/industries/4028440/Pacific-Blue-pulling-out-of-NZ-domestic-flights

Share price has responded too, continuing on its upward trend.

[J R Ewing]

I think it is Jetstar's presence that has made Virgin's position untenable here, not Air NZ. They were getting some traction while Qantas was operating as a full service competitor to Air NZ. Once Qantas swapped to Jetstar, Virgin was always going to struggle.

Now no doubt it will be prices up and service down (if there is any scope left for reducing service standards). Good for the shareholders I guess...

[Oiler]

I think it is Jetstar's presence that has made Virgin's position untenable here, not Air NZ. .

Now no doubt it will be prices up and service down (if there is any scope left for reducing service standards). Good for the shareholders I guess...

JR for me as a frequent traveller (from a regional airport) have got no complaints about AIR service and pricing. Competitors Jetstar and Virgin Blue only try and compete on the main trunks and you will never see them servicing the regionals (no money in doing that )

AIR has emerged over the last few years as a very efficient airline and with great service. Go fly a domestic US airline and then you will know what "no service" is about.

Note: I do not own any shares in AIR or work for them, but as a constant traveller I think AIR has a lot to be proud of.
I have no sympathy for the foreign airlines coming in to the NZ domestic market, low balling prices and then running off licking there wounds when they realise the market isnt as big as they thought.

Competition in business is good but the playing fields need to be level and the same for everyone. How come AIR cant operate within AU ??? We open our market to "foreign" competition. Australia is not a foreign country but they love to suck the profits out of this country be it airlines, banks etc etc.

[J R Ewing]

JR for me as a frequent traveller (from a regional airport) have got no complaints about AIR service and pricing. Competitors Jetstar and Virgin Blue only try and compete on the main trunks and you will never see them servicing the regionals (no money in doing that )

AIR has emerged over the last few years as a very efficient airline and with great service. Go fly a domestic US airline and then you will know what "no service" is about.

Note: I do not own any shares in AIR or work for them, but as a constant traveller I think AIR has a lot to be proud of.
I have no sympathy for the foreign airlines coming in to the NZ domestic market, low balling prices and then running off licking there wounds when they realise the market isnt as big as they thought.

Competition in business is good but the playing fields need to be level and the same for everyone. How come AIR cant operate within AU ??? We open our market to "foreign" competition. Australia is not a foreign country but they love to suck the profits out of this country be it airlines, banks etc etc.

I agree Air NZ is one of the best airlines in the world. My comment on service standards relate mostly to ticketing conditions and price gouging of customers that have to change travel plans, not to cabin service or the staff in general. The airline industry as a whole has suceeded in setting abysmally low standards in how to treat a customer - to the point that you can now be treated like dirt and think you are getting 5-star service because you would be even worse off with another carrier.

[Jaa]

I agree Air NZ is one of the best airlines in the world. My comment on service standards relate mostly to ticketing conditions and price gouging of customers that have to change travel plans, not to cabin service or the staff in general. The airline industry as a whole has suceeded in setting abysmally low standards in how to treat a customer - to the point that you can now be treated like dirt and think you are getting 5-star service because you would be even worse off with another carrier.

I really don't get what your beef is JR?

Air NZ's full fare ticket allows you to change your flight for free even after the flight has taken off. Features like that ensure business travelers like myself will pay more for their tickets. JetStar may have squeezed Pacific Blue from below but believe me the real damage was done by Air NZ squeezing from above as it the higher paying customers that give an airline most of its margin.

I am also stunned you think airlines price gouge as collectively (and AIR is only marginally better than average in this regard) either lose money or make a tiny margin on the amount of revenue they bring in. Qantas's underlying profits in the current year after tax was only $112 million on total revenues of $13.8 billion!!

If your looking for price gouging have a look at the airports with their 50%+ margins :eek2:

As the large amounts of silence on the AIR thread shows no sensible people invest in airlines.

[Jaa]

June visitor arrivals were up 8 per cent from the same month last year, with more people arriving from Australia and a recovery in numbers from China, Japan and Korea. Arrivals from these countries in June last year were particularly hit by the H1N1 pandemic.

"There is also a clear sign of Asian arrivals rebounding from swine flu- induced weakness, with Korean, Chinese and Japanese arrivals up 33 per cent year on year," he said.

Beginning to feel like Snoopy replying to my own posts....

Today's monthly operational stats from Air NZ were very strong including as alluded to above a very strong bounce back in Asian demand. Passengers carried on Asian/UK routes were up 12.2% with a healthy increase in yield taking the Revenue Passenger Kilometres (RPK) for the sector which is the key KPI for an airline up 15.4% on last year. Also in the news today was a tripling of charter flights out of Japan for the summer from 4 to 14.

Overall yields were up 5% and RPKs 6.8% were both up strongly. The load factor at 84% is now so high that to grow further Air NZ will need to add capacity which it has already started to do with its existing aircraft. Many of its 747s have been lightly used in the last year so plenty of capacity on tap. Of course any new capacity after the marginal costs will go straight to the bottom line.

The upcoming result may not reflect this improved operating environment but the outlook with the demise of the Pacific Blue domestic operation and the Rugby World Cup next year combining with the arrival of their new A320 domestic fleet the outlook is starting to look good (insert general airline disclaimers).

[Jaa]

Result "in line" with analyst expectations and as a suggested above a very aggressive outlook.

Operational and share price momentum is now strongly positive and the arrival of new 777-300ERs and A320s in the next 6 months should ensure this momentum is maintained.

Highlights
• Normalised earnings before taxation of $137 million, down $8 million
• Normalised earnings after taxation of $92 million
• Operating revenue down 12% to $4.0 billion
• Passenger demand down 4.7%
• Passenger load factor up 2.8 percentage points to 81.8%
• Net cash position $1.1 billion
• Final dividend of 4c per share

To put this result in context, Air NZ earned more from flying in the previous year than every other Australasian airline combined. Qantas & JetStar managed $AUS17m combined with Virgin Blue $AUS20m and Tiger Airways still in growth aka loss mode.

[bull....]

Higher NZ dollar + increasing tourist travel must be a bonus for them at the moment.

[Zito]

New Zealand = cheap for Australians to visit at the moment. It is also possible that those tourists from further afield who are debating the merits of NZ v Aust would be looking closely at how expensive Aussie is right now and choosing to come here instead.

[modandm]

Operational and share price momentum is now strongly positive and the arrival of new 777-300ERs and A320s in the next 6 months should ensure this momentum is maintained.



AIR/VBA alliance approved by ACCC just MOT to go. This is a win for shareholders and the public through better flight frequency. Great news!

AIR really pushing as a stock this year - i got some at 1.25 then doubled down at 1.05 and sold 1/2 at 1.34 now 1.47 for a 30% gain on average entry.

I have a hobby interest in planes and find airlines facinating (though not often great investments). I really think AIR is set for a couple of great years with the fleet improvements, new shorthaul product (here) and long haul product (coming early 2011), and the RWC tailwind, as well as VBA tie up. Everything is going AIR way right now. GREAT!! Let's hope management are aggressive in route expansion 2011 with the 77W and the 747 still around.

[Hoop]

How on earth did this gutter garbage make Major headline news in a major NZ paper (NZ Herald)

Air NZ - where honesty costs (http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10697908)

By Edward Gay (http://www.nzherald.co.nz/edward-gay/news/headlines.cfm?a_id=341)


NZH (and Ed Gray) shame on you for giving Air NZ a negative headline spin.

In times of intense competitive pressure amongst airlines there's no need for this sort of thing.


At least the majority of reader feedback shows no sympathy for the family...so it seems there is no marketing damage for Air NZ.

[Jaa]

Its low news season Hoop so the media are scratching around for any old story. All the senior journalists are also on holiday so the juniors are running the shop.

In more interesting news, just before Christmas, Morningstar massively increased their valuation of Air NZ to $2.15!

I have long believed that if well run which it is Air NZ is worth $2+ on average throughout the business cycle with a likely reasonable price range of $1 - $3.

[percy]

I brought a few just before Xmas;Reasons being;I know that most flights are full,and forward bookings are high.With more international flights[Asian and Chinese]there will be more overseas people looking to fly within NZ.The new couch should be a winner for long haul flights,and I expect AIR to make good money selling them to other airlines.However I am sure the alliance with Virgin will give AIR their much needed Australian feeders.Will be of benefit to Virgin as well giving them a feeder from AIR customers.A very good deal.All AIR need to do is add some freight capacity to Australia.

[percy]

Two announcements today,both positive.
Code share agreement with Virgin Atlantic .
China Southern Airline flights to Auckland will add more tourists to use AIR flights in NZ.

[Toulouse - Luzern]

Will be interesting to see if it goes thru 155 resistance ...

[percy]

Will be interesting to see if it goes thru 155 resistance ...

Was going to say it will fly through,but it does seem to be flying into head winds,however it is still above the 10day,20,30,60,180 day moving averages,and is above the high of $1.45 reached on 12th April 2010.So the strong uptread is intact.

[modandm]

picked up some for my folks and some for me just now at 1.44. Surprising weakness on no news - likely some institutions trimming their positions and taking a little profit (a good opportunity to top up). AIR will be reporting in early-mid feb and im expecting good news. Noticed that Mornignstar upgraded AIR a while back for $1.60 to $2.15 which to me seems a little bullish but I do think we will see $1.80 this year. AIR continues to pay a nice sized dividend aswell.

I expect the introduction of new more efficient fleet to largely offset the increased cost of jet which seems a key risk. On oil i think OPEC will be concerned about the rising prices (now circa $90) and be under pressure particularly from the US to maintain cheap oil as to not burn the 'green shoots' and fragile world economy.

[minimoke]

I was talking to a tea lady and it seems AIR is awash with cash. They have more staff than needed and many of those aren't productive nor have a concept of productivity. There could be real opportunity to extract more value to shareholders by looking at their internal costs.

[CJ]

They have more staff than needed and many of those aren't productive nor have a concept of productivity. Bloody govt department. I thought it was meant to be run commercially.

[winner69]

Bloody govt department. I thought it was meant to be run commercially.

Thats what happens when you have zillions in the bank ..... even though most of those zillions is prepaid fares

[Jaa]

I was talking to a tea lady and it seems AIR is awash with cash. They have more staff than needed and many of those aren't productive nor have a concept of productivity. There could be real opportunity to extract more value to shareholders by looking at their internal costs.

What a crock of nonense based on nothing more than hearsay.

Air NZ is an extremly well run company. If they sometimes have more people than they need that is because the alternative would be to occassionaly provide a Jetstar level of service. You don't become the world's best airline and attract growing levels of high-margin business in the front cabins by providing crap service.

I call it good long term management and long may it continue.

[Arbitrage]

It seems to have some commercial nouse. It was cheaper to fly to Sydney this weekend than it was to fly to Napier. Like any commercial glorified transport/flying bus operator they always manage to see a good opportunity to gouge.

[minimoke]

Bloody govt department. I thought it was meant to be run commercially.
I guess that depends on how you define "commercial". Some may say that a commercially run business looks after Directors first. You then create a structure that gives the impression of size - because small equals vulnerable. Any good commercial manager knows to surround themselves with sycophants as a means of job security - you get to keep their good ideas while having many hands on a smoking gun when things go wrong. And where you can't get external growth organic growth is always a credible alternative.

[modandm]

I was talking to a tea lady and it seems AIR is awash with cash. They have more staff than needed and many of those aren't productive nor have a concept of productivity. There could be real opportunity to extract more value to shareholders by looking at their internal costs.

I was flying to Oz recently and noticed 4 or 5 Air NZ staff at the international transfers desk most doing nothing just standing around. Then after about 30 mins most of them were busy checking passsengers for US security laws on the evening flights to SFO LAX and LAX-LHR.

It's natural in the aviaton industry that people sometimes are busy sometimes not... I wouldn't draw much conclusions from it. As for the head office staff - my experinces have been great and I think they have a great culture and good expericnced staff. AIR NZ is a company that people want to work for which is great

[minimoke]

What a crock of nonense based on nothing more than hearsay.
Well they' had around $20k of my cash over the last couple of months and thats just on internal flights so I know first hand there is good cash flowing in.


Air NZ is an extremely well run company. I only fly AIR internally because the competition is rubbish. That does not automatically equate to a well run company. I'm not suggesting they are a poorly run company - what they do they do well - if all you expect is for a bus service running on time in the sky.
Flights are on time, water is cold, biscuits are easy to say "no" to and Koru is a good way of Sharing The Love by going somewhere else.


If they sometimes have more people than they need that is because the alternative would be to occassionaly provide a Jetstar level of service.
I'm not suggesting its the front line staff that are getting fat - its the back office wallahs.

You don't become the world's best airline and attract growing levels of high-margin business in the front cabins by providing crap service.
AIR aren't the worlds best. Asiana scored that award and AIR got 5th. I haven't been front cabin for a while on AIR but I presume they don't get subjected to the awful rugby focussed emergency instructions. Hearing it once might be worth a chuckle - more than that it is simply irksome. If I hear it one more time I'm asking for a life jacket and a seat next to the exit door.


I call it good long term management and long may it continue.
I did very nicely out of AIR when they crashed and burned and looking for an opportunity to get back in. That will probably be when they start to cut the fat. They have domestic tied up but I'll be keeping an eye on international where there is more competition.

[macduffy]

Pleased to say my recent experience with Air NZ has been consistently good. Just as well, as I'm still harbouring some residual negativity due to my experience a few years ago when I had to forego a flight due to illness. It was a no-refund fare but I figured that I was at least due a refund of the GST as no goods or services had been provided. Must say, I wasn't entirely sure of my grounds there but I received an assurance that this would be refunded after reference to Head Office. That's when the run around started and I never received a refund or a satisfactory explanation.

So I'm still gradually "forgetting" that but recent experiences have been good in all respects.

[percy]

[QUOTE=minimoke;333662]Well they' had around $20k of my cash over the last couple of months and thats just on internal flights so I know first hand there is good cash flowing in.

That is a lot of flying.!! Were the flights pretty well full or not ?

[Jaa]

I did very nicely out of AIR when they crashed and burned and looking for an opportunity to get back in. That will probably be when they start to cut the fat. They have domestic tied up but I'll be keeping an eye on international where there is more competition.

The key to watch for is not fat as you call it as I would argue it doesn't exist. Like modandm I have also spent a bit of time over the years working with people in Air NZ's head office and have been nothing but impressed. They compare very favourably with other NZ head offices.

The keys to Air NZ's future performance are in the monthly operating stats they put out. Look for increasing capacity with stable or increasing margins and stable load factor's (I would argue these are currently at unsustainably high levels).

All of which have been happening for the last 6 months and for the following reasons should continue:


Virgin Blue's exit from NZ (increased margins/load factor)
Air NZ's new A320 domestic fleet (increased capacity)
Virgin Blue / Air NZ trans tasman alliance (increased capacity & load factor from increased Australian and to a less degree NZ demand)
Air NZ's new long haul fleet and international products (increased capacity & load factor from increased demand)
Rugby World Cup (Increased international & domestic demand)
Recovering economy (Increased international & domestic demand)

[minimoke]

[QUOTE=minimoke;333662]Well they' had around $20k of my cash over the last couple of months and thats just on internal flights so I know first hand there is good cash flowing in.

That is a lot of flying.!! Were the flights pretty well full or not ?
Main center flights are pretty much consistently full. AIR pricing strategy is good here for shareholders with only two price options and limited seats on the "cheap" seats. High margin high volume is a good recipe.

Regional centers are generally half or less full. High margin low volume probably works in a monopoly environment.

[Oiler]

[QUOTE=percy;333666]
Main center flights are pretty much consistently full. AIR pricing strategy is good here for shareholders with only two price options and limited seats on the "cheap" seats. High margin high volume is a good recipe.

Regional centers are generally half or less full. High margin low volume probably works in a monopoly environment.

New Plymouth (regional center) is definitely running on the higher side of half full.

As Jaa has said Air NZ is a very lean mean well run machine, innovative and creative. Profitable and punch way above there size.

Air NZ is (in my view as a very frequent flier) a company that NZers should be proud of.

NB. I dont own shares in Air NZ

[Snow Leopard]

Air New Zealand Acquires Substantial Shareholding in Virgin Blue (http://stocknessmonster.com/news-item?S=AIZ&E=ASX&N=349097) (ASX announcement)

best wishes
Paper Tiger

[minimoke]

[QUOTE=minimoke;333671]

New Plymouth (regional center) is definitely running on the higher side of half full.

Thats probably consistent with my experience with that particular destination. Though I'm generally having to fly via wellington so even then they can only half fill a plane with Christchurch / wellington and other feeders into Wellington. I don't know if the oil companies have had or still have a deal with AIR to buy fixed seats regardless of whether anyone is actually filling those seats. Such a deal was done to get people from Ch to the Coast but I gather AIR pulled the plug on it.

[CJ]

Air New Zealand Acquires Substantial Shareholding in Virgin Blue (http://stocknessmonster.com/news-item?S=AIZ&E=ASX&N=349097) (ASX announcement)

Wow - lets hope it goes better than Ansett.

They must have a lot of excess cash to be able to spare $100 - $150m. Pretty sure the government doesn't that much cash in the back pocket ;)

[modandm]

i am pretty surprised by this. Not sure what AIR is thinking... I mean they had the strategic alliance on the tasman tied up and when virgin becomes star alliance then all will be codeshares... Not sure what this investment achieves for AIR... I know they have been talking about scale and the need to be relevant and I think this is true but what does buying 15% of VBA do... I would have understood if they had bought them out entirely and gone guns blazing at qantas.

Looking forward to hearing the strategic rationale in the 1/2 year update

Can't help but think the market was aware of this and it may have prompted the fall from 153 to 143 over the past week...

[CJ]

will be interesting to know how mucht they have already bought and at what price as it spiked 10% yesterday. I see ASB has it as a Reduce but the Reuters has most brokers picking it as a hold -> outperform with an average of buy.

Labour is going to have a feild day with this. NZ govt borrows $300m a week but one of their 'SOE' has the money to start buying overseas airlines.

You dont get synergies with 15% but maybe they will get a management contract which will boost AIR's profits??

[percy]

Aussie is a much larger market than NZ.AIR really need a big "feeder" to grow,which VB will provide.Cemeting this arrangement with a shareholding in VB will give AIR more influence.A board seat would be positive.Makes sense to me.

[minimoke]

I was talking to a tea lady and it seems AIR is awash with cash.
Well Jaa, looks like the tea lady was right. Enough cash (or AUD$145m) to go shopping for another airline