AIR - Air NZ.

[workingdad]

I am going to resist the temptation to buy back in the 2nd half of the holdings I had and see how Friday and Monday go..... Maybe the last couple of attempts to catch the knife have taught me to be somewhat more conservative.

What are others thinking? Be interested to see what the chartists thoughts are as well.

[sb9]

I am going to resist the temptation to buy back in the 2nd half of the holdings I had and see how Friday and Monday go..... Maybe the last couple of attempts to catch the knife have taught me to be somewhat more conservative.

What are others thinking? Be interested to see what the chartists thoughts are as well.

As per NBR article today, there seem to be lot of headwinds suppressing AIR sp. I for one not brave enough to add anytime sooner.

[Yoda]

I am going to resist the temptation to buy back in the 2nd half of the holdings I had and see how Friday and Monday go..... Maybe the last couple of attempts to catch the knife have taught me to be somewhat more conservative.

What are others thinking? Be interested to see what the chartists thoughts are as well.

Currently holding, but wanting to get out when it goes up. Its too unpredictable.
i am happier with less volatility, like FPH .

[babymonster]

It's a bit early to say the sp has turn.. But good to see it was up today..

[workingdad]

Currently holding, but wanting to get out when it goes up. Its too unpredictable.
i am happier with less volatility, like FPH .

I would be surprised if there weren't more with the same game plan. I must admit, this has been a lesson for me and not one without a decent loss. Managed to mitigate it somewhat selling and buying at various stages on the way down rather than holding from the top. Certainly wanting to recoup some of that but not 100% sure throwing back in to that level is right or just cut the loses, perhaps see how the half holdings work out and hedge my bets but I still have some faith in the company and a reasonable outcome on the VAH sale.

I do think if there is still some selling pressure to come it will happen tomorrow afternoon capitalising on small gains and perhaps a good start to the day tomorrow.

[Beagle]

Roger did you ask TC around the business case to lending virgin money then to back flip and want to sell its holdings altogether. It happen so fast that I feel shareholders need to understand what was going through then heads at the time. How ever I doubt they will answer that...

Hi Brend,

I would have liked too but I really wanted to focus on the main issue and he seemed keen to wrap up the discussion pretty quickly.

[Whitebeard]

AIR doing well in safety..
https://uk.news.yahoo.com/20-safest-airlines-world-105429023/photo-p-carrier-awarded-maximum-seven-photo-105429238.html?soc_src=social-sh&soc_trk=fb

[babymonster]

What's one of the main thing I fly with air. Safety

[peat]

http://www.bloomberg.com/news/articles/2016-05-26/branson-says-talks-under-way-for-air-nz-s-virgin-australia-stake

[winner69]

THose big trades at 205 signalled the bottom

All up from here ...... bring on 3 bucks again


So 33% down but 50% up - yippee

(and then we can through the cycle again)

We are up up and away .....big time

As Balance said, just wait for the big crossings. That was yesterday at 205

We won't see 205 again for a while

[skid]

As per NBR article today, there seem to be lot of headwinds suppressing AIR sp. I for one not brave enough to add anytime sooner.

Im sure both of you are not alone-although I think the SP will gain from here -I also think its far better to wait till it has gained more and done so consistently..at that time investors will feel far more comfortable,and at that time there will naturally,be more of them wanting to come on board.
IMO the psychology needs to turn from ''dangerous beast'' to ''this is a majority government owned business with a good balance sheet and is still successful--I cant believe that the market smashed it so bad''--to put it simpler --when it goes from ''opportunity''...to ''safer opportunity''

I can understand why management did not want to say much about VAH--they would have to be SO careful at times like this---of course Branson could just be a flash in the pan but it is far easier for him to inform, than AIR management. Its encouraging ,if nothing else.
It brings to light the fact that an ailing company can still be of value, strategically. Could be a bit like buying a clapped out dump of a villa in grey Lynn---you are not buying a house...you are buying an address.

[bull....]

looked like it was way oversold yesterday at 2.05 and still is today according to some metrics, and on the weekly - needs to clear 2.15 for a shot at 2.30 next week according to the crystal ball lol

[smtrader]

looked like it was way oversold yesterday at 2.05 and still is today according to some metrics, and on the weekly - needs to clear 2.15 for a shot at 2.30 next week according to the crystal ball lol

I need to rent it out off you

[allfromacell]

Qantas is testing the $3 support, I would be concerned if this breaks. QAN and AIR typically follow each other albeit AIR has taken a bigger beating recently.

[bull....]

Qantas is testing the $3 support, I would be concerned if this breaks. QAN and AIR typically follow each other albeit AIR has taken a bigger beating recently.

roughly 29% fall for qantas vrs 38% fall for air nz - both fell off a cliff in april when oil really started to accelerate to the upside.

[couta1]

Perhaps Qantas and Air will both be $3 NZ eventually.:cool:

[percy]

I brought back half the number I sold a few weeks ago.Paid $2.1185 today.

[bull....]

I brought back half the number I sold a few weeks ago.Paid $2.1185 today.

is it a trade with a stop loss percy or an investment?

[Balance]

Qantas is testing the $3 support, I would be concerned if this breaks. QAN and AIR typically follow each other albeit AIR has taken a bigger beating recently.

Been a fair bit of switch play between AIR & QAN in the last 2 years. QAN held up while AIR was sold down in recent weeks - switch from one to the other?

Now QAN may be sold down to switch into AIR, in the face of potentially good news on VAH.

[smtrader]

WYN gets a speeding ticket and a price enquiry, while AIR gets nothing - its as if nzx has inside info more than shareholders.

Also personal views - AIR is now on classic DCB on the back of possible retreat of oil from hitting 50, and possible interested parties in VAH as that info is getting around. Unfortunately, both more likely than not will not materialise in the near future, ie. oil price will break above 50 (check volumes and iran's production) and for VAH, well i don't need to talk much about that.

(These views are my own and should not constitute any advice what so ever)

[percy]

is it a trade with a stop loss percy or an investment?

Just the usual "bonus issue'[bit over 1 for 4 here] the market often gives me on my long term investments.!!..lol.Makes my average cost price lower, and certainly makes the yield on that average very tastie.
Looks to me "fair" or "fairish" value is somewhere between $2 and $3.Selling at $2.83 on 22nd April and buying back today at $2.118,just makes me "well positioned.".

[smtrader]

Just the usual "bonus issue' the market often gives me on my long term investments.!!..lol.Makes my average cost price lower, and certainly makes the yield on that average very tastie.
Looks to me "fair" or "fairish" value is somewhere between $2 and $3.Selling at $2.83 on 22nd April and buying back today at $2.118,just makes me "well positioned.".
Awesome move..

[percy]

Awesome move..

I get the odd one right,however,just when I think I know what I am doing, the market gives me a good kick up the backside.!!lol.

[blockhead]

Well $2.13 is certainly a better way to end than just one week ago @ $2.05, Couta you are well on the journey back towards positive territory again.................well you are 2 steps on the way perhaps !

[bull....]

aiz trading at 2.05 - 2.1 equivalent nz 2.20 for Monday? that would be nice

[Baa_Baa]

$6.9m turnover of 3.26 million shares, the majority of which appeared to be quite happy quietly feeding the bid in modest increments all day between $2.13 - $2.14. Obviously there were willing buyers, that's what makes a market, but the quiet control with which the asks were executed today suggests the pros are firmly in control. They just made ten cents more than they were getting yesterday.

[Marilyn Munroe]

Onlookers of this thread would be familiar with my advising John Key to sell Cullen Airlines to Etihad.

A boffin from the Treasury has run the IRR ruler over the Crowns buy-in to Cullen Airlines.

There are three artices on the subject on the Treasuries web site. Suitable reading for a wet Saturday. Go to;

http://www.treasury.govt.nz/publications/research-policy/staff-insights

The authors conclusion; The Crowns IRR return on its investment in Cullen Airlines has been nuetral helped by a dash of good fortune due to lower fuel prices.

Boop boop de do
Marilyn

[winner69]

Onlookers of this thread would be familiar with my advising John Key to sell Cullen Airlines to Etihad.

A boffin from the Treasury has run the IRR ruler over the Crowns buy-in to Cullen Airlines.

There are three artices on the subject on the Treasuries web site. Suitable reading for a wet Saturday. Go to;

http://www.treasury.govt.nz/publications/research-policy/staff-insights

The authors conclusion; The Crowns IRR return on its investment in Cullen Airlines has been nuetral helped by a dash of good fortune due to lower fuel prices.

Boop boop de do
Marilyn

Jeez those Treasury guru's make life complicated

They should have just asked Percy et al to tell that their current holding aren't free but cost them $1.16 share

Conclusion - current price at $2.13 so they have made heaps even before counting the dividends (and the dividend yield is very high at the moment)

Job done - time to cash in I reckon. No reason why we should own half an airline

[Beagle]

Just the usual "bonus issue'[bit over 1 for 4 here] the market often gives me on my long term investments.!!..lol.Makes my average cost price lower, and certainly makes the yield on that average very tastie.
Looks to me "fair" or "fairish" value is somewhere between $2 and $3.Selling at $2.83 on 22nd April and buying back today at $2.118,just makes me "well positioned.".

Nice trade. I sold some at $3.03 and bought them back at $2.27 but continued to hold half on the way down...and I blame the aviation enthusiast that lurks within for my reluctance to completely exit. I'll know better next time.

[Raz]

Nice trade. I sold some at $3.03 and bought them back at $2.27 but continued to hold half on the way down...and I blame the aviation enthusiast that lurks within for my reluctance to completely exit. I'll know better next time.

Invested in more ways than one..never makes it easy.

[Raz]

Jeez those Treasury guru's make life complicated

They should have just asked Percy et al to tell that their current holding aren't free but cost them $1.16 share

Conclusion - current price at $2.13 so they have made heaps even before counting the dividends (and the dividend yield is very high at the moment)

Job done - time to cash in I reckon. No reason why we should own half an airline

Yeah you want them to sell low..ok with me if they increase your personal income tax only to make up for the lost return...

[smtrader]

http://www.sharechat.co.nz/article/373c65c0/nzx-toughens-enquiry-process-for-sudden-share-price-movements.html

I think this is very relevant. There is probably no doubt that NZX privately queried AIR. And seeing the volume and price drop so drastically without material information being released 'yet' (probably due to an exception) makes one wonder what will be released, and more importantly if that info has had some leak leading to contagion and price drop. One thing for sure is we have a couple of interesting weeks ahead!

[Xerof]

http://www.sharechat.co.nz/article/373c65c0/nzx-toughens-enquiry-process-for-sudden-share-price-movements.html

I think this is very relevant. There is probably no doubt that NZX privately queried AIR. And seeing the volume and price drop so drastically without material information being released 'yet' (probably due to an exception) makes one wonder what will be released, and more importantly if that info has had some leak leading to contagion and price drop. One thing for sure is we have a couple of interesting weeks ahead!

When Brokers are 'retained to advise', sieve's inevitably come to mind. They will protest loudly about chinese walls etc, but c'mon......just look at some of the info that certain people on this site post in veiled language.

[Beagle]

http://www.sharechat.co.nz/article/373c65c0/nzx-toughens-enquiry-process-for-sudden-share-price-movements.html

I think this is very relevant. There is probably no doubt that NZX privately queried AIR. And seeing the volume and price drop so drastically without material information being released 'yet' (probably due to an exception) makes one wonder what will be released, and more importantly if that info has had some leak leading to contagion and price drop. One thing for sure is we have a couple of interesting weeks ahead!

I see this as a very positive development for N.Z.'s capital markets. I know one participant on here, (not me I can't take credit for that), that took the imitative to communicate their thoughts regarding AIR's violent recent SP drop to NZX compliance and this statement came out the following day so maybe that good honest bloke made a real contribution to the development on N.Z's capital markets.

Really though, and in addition, the FMA should run the ruler over management sales from an insider trading point of view. It will be interesting to see how they respond, if at all.

Now we know that there's credible interest in AIR stake from multiple parties, really something AIR should have released as a news release to reassure shareholders anyway given the complete air pocket the SP has hit, it will be interesting to see how many tens of millions of shares institutions will keep flooding the market with at the current depressed price. I would think those institutions with an extremely negative view might start to run out of scrip sometime soon given that over 16% of the free float of all shares has changed hands in the last 30 days.

[macduffy]

Wouldn't it be preferable, though, for the NZX to make a public "please explain" request so that it all becomes public record, fresh air being the best disinfectant - and all that.

[Beagle]

I tend to agree to some extent but it seems to me that this sort of price enquiry is limited to sudden one day movements in the SP and ninety nine times out of a hundred is met with the usual response with which we are all familiar.

I think this AIR thing is a different kettle of fish, (flock of birds ?). Senior management were selling with some apparent / alleged advantage in terms of information in regard to all the aforementioned matters we've discussed on here plus their knowledge of how the sale of AIR's stake in VAH was progressing, (or not progressing as the case may be). That we have to rely on a statement from Richard Branson to get any assurance that things are progressing okay is in my opinion a pretty sad indictment on management communication skills. How would it have been any breech of insider information or confidentiality to at least have publicly reassured shareholders as the price was crashing that there was multiple party interest and negotiations and discussions were ongoing ?

Maybe I am being naïve and the only investors that really count are large institutions, certainly its easy to form that impression from the fact that retail investors regardless of the number of shares they hold are excluded from so called investor day briefings, (should have a name change to institution and analyst briefing).

Not only has management's halo slipped, I think its vaporised into thin air. (Disc grumpy holder, DYOR, not to be considered professional advice or a recommendation).

[cyclist]

Not only has management's halo slipped, I think its vaporised into thin air. (Disc grumpy holder, DYOR, not to be considered professional advice or a recommendation).

Just quietly chuckling to myself. Hell hath no fury like a Roger scorned :cool:

(Please take that in the spirit intended Roger. Really appreciate your efforts on the forum).

[Beagle]

LOL mate. I just like to see transparency and integrity in the N.Z. financial markets. I'm no Bruce Sheppard or Max Gunn, not even a pale shadow of either, but I like to try and make a difference for the better when I can and when I honestly believe things aren't right.

[smtrader]

Wouldn't it be preferable, though, for the NZX to make a public "please explain" request so that it all becomes public record, fresh air being the best disinfectant - and all that.

perhaps... im reading Taleb's book antifragile and can't help the obvious relevance to nzx's 'please explain' requests.. if i am using his logic right, it follows that any company receiving such query will cause a negative impact on it (and naturally the SP). Because the company will more likely begin to employ methods to try and stabilise the share price or guard information... and so eventually the SP will take a significant correction.. so I guess maybe it might be better for NZX to go behind closed doors to force info out instead of publicly stating 'please explain'.. after all ohpark0119 said it best below.


what's the point of asking anyway? Is nzx expecting something like "we don't give a **** about nzx rules"?

[workingdad]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11647295

Breakfast TV this morning says they have a new sponsor in Jetstar and in the news segment chris luxon earmarked/tipped to replace departing Fonterra CEO=theo spierings.

[bull....]

http://www.sharechat.co.nz/article/54788d13/wynyard-says-it-has-nothing-to-disclose-after-nzx-queries-21-price-slump.html

air nz must be different a?

confidential enquirys mean the market isn't transparent as people within the nzx will now have insider information as well as within the company. could get senarios like the rbnz leak

[Raz]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11647295

Breakfast TV this morning says they have a new sponsor in Jetstar and in the news segment chris luxon earmarked/tipped to replace departing Fonterra CEO=theo spierings.

Theo moving on and C Luxon replacing him has been mentioned to me by brokers over the past several weeks as an additional reason for the share price move. The rumour is now built up such momentum its like the Manu United manager replacement by now.....

ps Most likely good timing for Mr Luxon to consider a move given where AIR is at in its cycle and his star is as bright as it likely to get....

[bull....]

Theo moving on and C Luxon replacing him has been mentioned to me by brokers over the past several weeks as an additional reason for the share price move. The rumour is now built up such momentum its like the Manu United manager replacement by now.....

ps Most likely good timing for Mr Luxon to consider a move given where AIR is at in its cycle and his star is as bright as it likely to get....

what does a guy who runs an airline know about farming? or adding value to milk?

[Balance]

what does a guy who runs an airline know about farming? or adding value to milk?

Will do a better job than all the wave rider CEOs Fonterra has had. At least he will know about managing risks and expectations.

[Raz]

what does a guy who runs an airline know about farming? or adding value to milk?

I agree, they may look at it for PR value with the real intent/agenda to change very little...in reality they need someone who really understands the industry,where they are at, has real strategic idea where they need to head and implement it...they will be lucky to recruit that now wouldn't they...

[workingdad]

I wonder if it will hamper a 3rd positive day for AIR now the rumour is in the public arena.

early trades at 2.15

[777]

what does a guy who runs an airline know about farming? or adding value to milk?

Luxon knew nothing about airlines until he joined AIR about 12 months before he became CEO, the job he was groomed for.

[bull....]

Luton knew nothing about airlines until he joined AIR about 12 months before he became CEO, the job he was groomed for.

well he should stick to airlines then and improve the share- price

anyway this new info if it was swirling around should have meant a please explain from air was warranted if it was causing a share price collapse?

[Jay]

I heard someone from Craig's this morning say, on the news, that there was a big seller of AIR, has now finished selling now and thinks the price will stabilise/rise now as it is oversold or something like that

[Beagle]

http://www.nbr.co.nz/article/airways-gives-airlines-break-cheaper-prices-small-operators-face-price-hike-b-189619

Interesting to see a Government monopoly taking it easy on airlines...of course the fact that they are the majority owner of AIR would have nothing to do with it...

On the Luxon thing. He's been instrumental in implementing an ambitious growth path for the company and the company is in the process of procuring the aircraft to meet those objectives.
In my view a departure now could be viewed by the market as him not wanting to take responsibility for the outcome of those plans.

It was interesting to read in the recent analyst day briefing that their growth objectives are now in line with the tourism growth rate to N.Z. This was a subtle change from previous growth ambitions' which seemed to be considerably higher than the rate of tourism growth and tends to suggest a more disciplined approach going forward.

I think the Govt will want the lions share of any sale of VAH and given the decline in the SP will be keen to see some real cash coming into their coffers in an election year.

Interesting timing that Treasury report on how well they'd done out of AIR wasn't it ! Carefully crafted to head off any left wing criticism in regard to the collapsing SP ?

[winner69]

I wonder if it will hamper a 3rd positive day for AIR now the rumour is in the public arena.

early trades at 2.15

Nah - saying the halo is no longer shining this could be seen as good news and give the price a boost

[macduffy]

I tend to agree to some extent but it seems to me that this sort of price enquiry is limited to sudden one day movements in the SP and ninety nine times out of a hundred is met with the usual response with which we are all familiar.


Sorry to harp on about this but the fact that a company is required to go public with its reply - even if it's a "we know nuthin" - must give the individuals involved cause to think hard before committing their signatures to the statement. Particularly if there are penalties attached to incorrect or misleading statements. Time the NZX toughened up a bit, IMO.

[Raz]

I heard someone from Craig's this morning say, on the news, that there was a big seller of AIR, has now finished selling now and thinks the price will stabilise/rise now as it is oversold or something like that

I had also heard the particular big seller in question had been tipped off the CEO was considering options...and that may be in part the reason they are selling.

Anyway as someone who has been an executive, not CEO of the entire deal, just a CEO of an overseas subsidiary which was large, really the role is PR & Politics....you have managers and teams reporting to you for everything else. You are only as good as the team that supports you when you get down to it. Your skill set became more your ability to influence.

[Beagle]

Sorry to harp on about this but the fact that a company is required to go public with its reply - even if it's a "we know nuthin" - must give the individuals involved cause to think hard before committing their signatures to the statement. Particularly if there are penalties attached to incorrect or misleading statements. Time the NZX toughened up a bit, IMO.

Agree 100% but don't forget T.C. signed off on those management share sales immediately prior to the price sensitive so called investor day briefing. Disappointing.

[blockhead]

If sp keeps rising there will be a "do you know any reason for price rise" question before we even knew if there was a reason for the drop

[smtrader]

If sp keeps rising there will be a "do you know any reason for price rise" question before we even knew if there was a reason for the drop

haha i think alot of holders are doubling up to lower average.. but the phrase "trend is your friend" comes to mind.. this irrationality is part of the markets so oh well always interesting to watch

[mikeybycrikey]

Sorry to harp on about this but the fact that a company is required to go public with its reply - even if it's a "we know nuthin" - must give the individuals involved cause to think hard before committing their signatures to the statement. Particularly if there are penalties attached to incorrect or misleading statements. Time the NZX toughened up a bit, IMO.

I think it is reasonable that there could be two replies to the "please explain" question. There is the public answer of "we know nuthin'", which inevitably comes. But many times there is the possible private answer that can't be made public: we're in takeover negotiations that we can't talk about, we're nearing a sale of VAH but can't talk about it, our CEO is moving to Fonterra, etc, etc.

There are many exceptions where the company might know something but can't divulge anything. I think there might be some benefit in these situations being privately released to NZX (and have the information be publicly released a few weeks later).

If the company does have information that they haven't released then it might be an indictation that the info is leaking out and providing more info to NZX allows these leaky channels to be followed up after the fact. (or provides yet another leaky avenue.....)

[Jantar]

Surely the CEO selling AIR shares when he is in negotiation for moving to a new company is itself insider trading?

[Beagle]

Surely the CEO selling AIR shares when he is in negotiation for moving to a new company is itself insider trading?

https://fma.govt.nz/contact/make-a-complaint/make-a-complaint-online/ If people feel as strongly as I do about this then please be aware that in my experience the FMA react to public pressure.

[Beagle]

On the day that rumours resurface of Mr Luxon's possible move to Fonterra the SP rises strongly...go figure ?

[smtrader]

On the day that rumours resurface of Mr Luxon's possible move to Fonterra the SP rises strongly...go figure ?

Tuesday evening will be more of a guidance where the share price is going.. the same holders who were experiencing fear last week.. are now experiencing greed...

[winner69]

On the day that rumours resurface of Mr Luxon's possible move to Fonterra the SP rises strongly...go figure ?

What happens when a halo loses it shine?

More coincidence than people thinking Luxon going a good thing?

[dobby41]

Tuesday evening will be more of a guidance where the share price is going.. the same holders who were experiencing fear last week.. are now experiencing greed...

Which always leads to teers.

[winner69]

On the day that rumours resurface of Mr Luxon's possible move to Fonterra the SP rises strongly...go figure ?

Be back to $3 before you know it

Those sells at 205 were the big buy signal

[bull....]

air nz have said luxon not leaving so price going up because of this

[RTFQ]

I wonder if CL is in negotiations with the board for a higher salary???

Timely leak if that's the case.

[Beagle]

air nz have said luxon not leaving so price going up because of this

Got a link to anything that's officially been said ?

[stoploss]

Got a link to anything that's officially been said ?

Air New Zealand's only comment today was that "Christopher Luxon remains committed to Air New Zealand"
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11647295

Wasn't Weldon and the board committed a few days before the departure ....?

[Beagle]

Air New Zealand's only comment today was that "Christopher Luxon remains committed to Air New Zealand"
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11647295

Wasn't Weldon and the board committed a few days before the departure ....?

Agree that's a very weak comment. There's been a fair bit of water under the bridge since Sept 2015...at that point he and the company could do no wrong. They say "a week is a long time in politics" well what's eight months in the airline industry ?

Winner, the odds of a quick recovery to $3 is extremely slim IMHO.

[Balance]

Agree that's a very weak comment. There's been a fair bit of water under the bridge since Sept 2015...at that point he and the company could do no wrong. They say "a week is a long time in politics" well what's eight months in the airline industry ?

Winner, the odds of a quick recovery to $3 is extremely slim IMHO.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11647295

Very strong denial from Fonterra. Australian media trying to create mischief as MGC has bombed spectacularly?

[smtrader]

strong bear pin developing.. i might be wrong but this might be the last DCB before a serious move downwards.. make sure the fasten seatbelt sign is on..

[bull....]

strong bear pin developing.. i might be wrong but this might be the last DCB before a serious move downwards.. make sure the fasten seatbelt sign is on..

looks dodgy, dcb might be over a?

[workingdad]

looks dodgy, dcb might be over a?

Or not......

[GR8DAY]

.....in fact now showing all the signs of a genuine SP recovery.......and not before time.

[K1W1G0LD]

More dodgy TA, cast in the guise of expertise!

[cyclist]

More dodgy TA, cast in the guise of expertise!

I for one would be a lot better off I had acted on the TA arguments for this stock. They have picked the wider trend pretty jolly well. Always good to maintain an open mind ....

[biker]

Buying more VAH at .275 Two months since AIR announced desire to exit.
Anticipating some developments over the next month

[Beagle]

http://www.nbr.co.nz/article/air-new-zealand-cancels-two-regional-routes-blaming-low-demand-b-189719

[smtrader]

Or not......

I think if everyone forgets TA's and looks at the bigger picture one can easily summarise that the short and medium term outlook is negative on many fronts, fuel costs are going to go up (AIR's hedging hasn't really done much, only transfered cost between years slightly with the addition of transaction fees - check them for yourself), demand in sectors are low, competition is high (which will slightly reverse ounces costs rise), interest environment not promising going forward and it's a cyclical stock... besides these fundamentals, there is now obviously some tension by shareholders seeing SP drop so drastically which will make any investor/speculator look twice before plunging money in AIR, thus you can't expect prices to just magically go up again for no reason (btw no one complained when stock price went up drastically over 2014 & 2015).. also, which is a BIG ONE, the flow of international money into the NZX over the past 4 months, has caused the whole market to go up.. you have to factor in what will happen when all that capital heads for the exits.. at the time, everyone thought the Fed was bluffin on raising rates, but now not so much, and funds will exit if that idea gains momentum... if your strategy was to hold AIR long term then forget monitoring the stock, collect dividends and eventually sell .... if you planned to be a short term holder and in a bad position atm, then reorganise your strategy and portfolio, perhaps decrease your average price and move along until it's time to sell.. of course things can quickly change as sometimes they do but for the time being it's not looking so promising.

[peat]

I bought AIR this morning,
Weekly looks good
8083given the grossly oversold position

The monthly not so much

8082Still dominated by the shooting star,

but I'd never buy an airline as a long term investment.

[Raz]

Buying more VAH at .275 Two months since AIR announced desire to exit.
Anticipating some developments over the next month

I agree worth a punt:-)

[Raz]

Weekly looks good
8083given the grossly oversold position

The monthly not so much

8082Still dominated by the shooting star,

but I'd never buy an airline as a long term investment.

Well said, having fun trading this stock again..good couple of weeks for that:-)

[dobby41]

Higher fuel costs would be to AIR's favour with them having a very efficient fleet.
Other less fuel efficient airlines can come in and take the cream while fuel costs are low but will struggle when they go up.

[Balance]

http://www.theaustralian.com.au/business/companies/deal-looms-on-air-nzs-virgin-stake/news-story/c2cb2104a54258493e256504d04c9691

Looks like a deal on VAH will happen so that will mean around NZ$500 freed up.

My take - Shareholders especially the government will be happy to receive a special payout of 35c to 45c a share?

[allfromacell]

http://www.theaustralian.com.au/business/companies/deal-looms-on-air-nzs-virgin-stake/news-story/c2cb2104a54258493e256504d04c9691

Looks like a deal on VAH will happen so that will mean around NZ$500 freed up. Shareholders especially the government will be happy to receive a special payout of 35c to 45c a share?

The links behind a pay wall :(, can anyone find a different article?

[Balance]

Deal looms on Air NZ’s Virgin stake

The Australian
12:00AM May 31, 2016


Sir Richard Branson expects a deal within two to three weeks

Billionaire Sir Richard Branson says the sale of Air New Zealand’s $450 million stake in Virgin Australia will be concluded within the short term but the entrepreneur would not be drawn on who would buy it.

The Virgin Group founder told The Australian an outcome was expected within two to three weeks but he would not be drawn on whether he would buy the shares himself.

Sir Richard was in Australia over the weekend for a range of meetings including the launch of a koala conservation program on Makepeace Island on Noosa River, which he jointly owns with Brett Godfrey, a former chief executive of Virgin Australia.

Air New Zealand announced in March that it intended to sell its shares in Virgin Australia, and Singapore Airlines and another airline are in the race to buy it.

“Air New Zealand have been saying for some time they need a return from their investment in Virgin Australia and it’s going the other way,” said one senior airline source yesterday. “Air New Zealand is a government-owned public company (so) they can’t have $450 million locked up. Air New Zealand is also struggling because Qantas has moved into their domestic regional market and they have Qantas and American Airlines coming into New Zealand. Air New Zealand need to be commercial. “It has not made a return (from its investment in Virgin Australia) and is not likely to make a return,” said the source speaking on condition of anonymity.

[winner69]

Winner, the odds of a quick recovery to $3 is extremely slim IMHO.

The special divies will drive it up to $3 .....then?????

[Beagle]

Thanks Balance. I know AIR are aiming for a conclusion of this matter before balance date otherwise there will be lots of very discontented shareholders at the next annual meeting.

Winner. No question this uncertainty has impacted the SP in a meaningful way. Once the uncertainty has been removed I'm expecting a decent recovery. I don't think most of the analysts have ascribed much value for AIR's stake in VAH into their DCF models so about half to two thirds of whatever AIR get for the sale of it is my best guess of the likely recovery. I'd love to suggest more but its best to be realistic.

[winner69]

Rereading the recent The Listener article on Luxon


Coming of age in the late 1980s and *witnessing the wreckage of the first faltering steps of the unshackled New Zealand economy, Luxon divined he would be a moral force in business. Making money was important but so was doing good – hence his bent for profit-sharing and sustainability.


Like the bit about profit sharing

[Beagle]

Yes I do too mate. No question AIR have enough of their own resources to progress their growth plans and also no question the Govt will be keen to see their books looking as good as possible in an election year. Considering their is no argument that this is now the peak of the cycle I see no reason why we can't be looking forward to a very good ordinary final dividend from peak cycle earnings, (especially in light of the first half one being fairly modest), plus a special that repays all of the capital released from the sale of VAH. Maybe this is why at the recent investor day briefing they made the point that the company has the ability to fully impute up to $750m of dividends... Hope the Govt leans on them and tells them it wants all the VAH money back before management start dreaming up some other creative ways to spend it....more green initiatives or Ansett Mk3 anyone, perish the thought...

[Raz]

Rereading the recent The Listener article on Luxon


Coming of age in the late 1980s and *witnessing the wreckage of the first faltering steps of the unshackled New Zealand economy, Luxon divined he would be a moral force in business. Making money was important but so was doing good – hence his bent for profit-sharing and sustainability.


Like the bit about profit sharing

Are you really giving this much weight. If you want to be a moral force in business then you don't decide to work for a company that is government majority owned or have other stakeholders with other agendas. You have to park your values and meet the political or other agenda of the day and we will see that.. instead you establish and run a charity reflecting those moral values..although that doesn't pay that well...

[BIRMANBOY]

That's a very black and white view...I think we live in a 'fifty shades of grey" world. Plenty of scope for individuals ..even in the deepest darkest govt. offices.
Are you really giving this much weight. If you want to be a moral force in business then you don't decide to work for a company that is government majority owned or have other stakeholders with other agendas. You have to park your values and meet the political or other agenda of the day and we will see that.. instead you establish and run a charity reflecting those moral values..although that doesn't pay that well...

[workingdad]

Does anyone think AIR will get 450million for its VAH stake?

[cyclist]

Does anyone think AIR will get 450million for its VAH stake?

Pretty hard to imagine, unless that also includes repayment of their recent "prop up" loan. The vacuum of any official statements on this whole thing is starting to get wearying.

[mikeybycrikey]

Does anyone think AIR will get 450million for its VAH stake?

Based on the current SP, you'd be looking at $270m. Whether they are going to sell above or below the current SP is anyone's guess! On top of that, they might be able to free up the $150m loan facility that was announced in March (although it's unclear to me if that money has actually been lent or if it's just a facility that may be drawn down later).

It's so hard to know what they would get for it though. How do you price a company that barely makes a profit and may never make a profit?

[winner69]

Mikey - strategic value, never under estimate it

[mondograss]

HNA Group is apparently paying 0.30 per share of VAH and intends to increase its holding to 19.99%. I wonder if they'll take some of AIR's stake.

http://www.asx.com.au/asxpdf/20160531/pdf/437l9rnmtr05fl.pdf

[blockhead]

This is the sort of Strategic value Virgin can have, won't do AIR's negotiations any harm either.

http://www.stuff.co.nz/business/world/80574581/virgin-australia-wants-to-get-more-out-of-china-signs-deal-with-hna-aviation

[bull....]

HNA Group is apparently paying 0.30 per share of VAH and intends to increase its holding to 19.99%. I wonder if they'll take some of AIR's stake.

http://www.asx.com.au/asxpdf/20160531/pdf/437l9rnmtr05fl.pdf

so air nz holding has been diluted? by the placement.

if they got 30c for there holding would roughly worth about 20 odd cents per share of the top of my head and they may want some it for new aircraft? and a small special div

[Raz]

HNA Group is apparently paying 0.30 per share of VAH and intends to increase its holding to 19.99%. I wonder if they'll take some of AIR's stake.

http://www.asx.com.au/asxpdf/20160531/pdf/437l9rnmtr05fl.pdf

Thats why the share price is up for IAR this am.

[Nasi Goreng]

Not even midday yet and momentum is strong. $2.50 looking good in 1 week on speculation of VAH sale. $2.05 was one of the most obvious signs of a turn around I've ever seen.

[winner69]

so air nz holding has been diluted? by the placement.

if they got 30c for there holding would roughly worth about 20 odd cents per share of the top of my head and they may want some it for new aircraft? and a small special div

Would take AIR stake below 20% - might make it easier to hock off

[mondograss]

Probably reduces the likelihood that they'd need the loan from AIR too.

[Nasi Goreng]

So @ 30c, Air NZ would get $275M for their $450M stake and they would still have $100M loan to VAH.

I would imagine the $100M loan is worth more to a non share holder than a significant shareholder. A significant shareholder would never want to send a company to the wall and would likely take stock options. A competitor who is owed debt would however push pretty hard to get its money back so I don't see a problem with the $100M loan, its a cash investment.

[workingdad]

All helpful to a rather battered AIR SP of late. I jumped back in picking up the rest of the holdings I had originally yesterday and first thing this morning. Paid a bit more than I anticipated but wanted to hold off and really see a turn around after such a turbulent ride of late.
Pleased to see this playing out with more positive aspect although anticipating some profit takers now it's jumping up.

[bull....]

looked like it was way oversold yesterday at 2.05 and still is today according to some metrics, and on the weekly - needs to clear 2.15 for a shot at 2.30 next week according to the crystal ball lol

ill have to rub my crystal balls more often lol

[Raz]

Get some positive news on AIR stake in VAH and think 2.45 is achievable ST, believe that news is not far off..all going to plan.

[Beagle]

HNA Group is apparently paying 0.30 per share of VAH and intends to increase its holding to 19.99%. I wonder if they'll take some of AIR's stake.

http://www.asx.com.au/asxpdf/20160531/pdf/437l9rnmtr05fl.pdf

Interesting move and does AIR no harm in terms of its prospects of selling.

Interestingly this stake is taken right at consensus view of asset backing http://www.4-traders.com/VIRGIN-AUSTRALIA-HOLDINGS-9597965/financials/ with no value ascribed to VAH's IP or goodwill...hardly surprising seeing as they're currently unprofitable. Consensus broker view is considerably higher though and could be enhanced by this deal with its implications around growth going forward. Taking into account the strategic value of AIR's stake I don't think 40 cps is completly out of the question for AIR's shares and hopefully any deal is nice and clean and involves a complete sale and repayment of any shareholder loans previously advanced.

[Newman]

So it looks that HNA would only need 7% of VAH shares more, which I assume would come from Air NZ. Would the capital raised be used pay back AirNZ's loan to VAH?

[GR8DAY]

......cant believe anyone would be selling at these levels with such potential news about to be released to the market, any day soon? Might be worth 20 or 30c to the SP........IMHO.

[workingdad]

......cant believe anyone would be selling at these levels with such potential news about to be released to the market, any day soon? Might be worth 20 or 30c to the SP........IMHO.

Profit taking is my guess. Some clever people went shopping at 2.05. Wish I was one of them.

Or different kind of clever people keeping price down to stock up. Seems to be some odd sells going on.....

I am resisting the urge to buy more but feel comfortable that the VAH thing will play out well. See if I can resist if it goes down below 2.25....

[workingdad]

Maybe some are viewing the HNA share issue as a negative?
Anyone have any comments on this? VAH share price seems to be reacting positively and as a major shareholder that's a plus but does it weaken AIRs position on selling at a premium?

[winner69]

Maybe some are viewing the HNA share issue as a negative?
Anyone have any comments on this? VAH share price seems to be reacting positively and as a major shareholder that's a plus but does it weaken AIRs position on selling at a premium?

Could temper any enthusiasm Singapore / Ethiad / Virgin / newcomer had

[smtrader]

I am resisting the urge to buy more but feel comfortable that the VAH thing will play out well. See if I can resist if it goes down below 2.25.....

there you go you might wanna stock up now?

[workingdad]

.

there you go you might wanna stock up now?

Still resisting the urge just at the moment but seems to be some resistance at this level.

You might get that bear pin today....

[Beagle]

Maybe some are viewing the HNA share issue as a negative?
Anyone have any comments on this? VAH share price seems to be reacting positively and as a major shareholder that's a plus but does it weaken AIRs position on selling at a premium?

I'm only thinking straight off the cuff here and out loud, (which is usually a dangerous thing to do LOL), but first up its important to note this is imply a heads of agreement at this stage.
Not only would it probably require the necessary approvals from Canberra but I would have thought it would also be something that would need ratification from shareholders by way of special resolution requiring 75% approval i.e. AIR's agreement. I think the lack of premium to NTA reflects the weakness of VAH's balance sheet, its present gearing level of nearly 6:1 debt equity is not something any airline should be proud of and its presently approximately breaking even when most airlines are doing well. Whether AIR can execute a transaction at a premium to that price now there's been that line drawn in the sand for their strategic stake now the balance sheet is somewhat strengthened remains to be seen.

[workingdad]

I'm only thinking straight off the cuff here and out loud, (which is usually a dangerous thing to do LOL), but first up its important to note this is imply a heads of agreement at this stage.
Not only would it probably require the necessary approvals from Canberra but I would have thought it would also be something that would need ratification from shareholders by way of special resolution requiring 75% approval i.e. AIR's agreement. I think the lack of premium to NTA reflects the weakness of VAH's balance sheet, its present gearing level of nearly 6:1 debt equity is not something any airline should be proud of and its presently approximately breaking even when most airlines are doing well. Whether AIR can execute a transaction at a premium to that price now there's been that line drawn in the sand for their strategic stake now the balance sheet is somewhat strengthened remains to be seen.

I like it when you think out loud.
I didn't realize the requirements for it to go through. Seems some posturing going on and the rift between AIR and VAH perhaps in play......

[Beagle]

Yes quite possibly wd. TBH I'm not sure what existing shareholder approvals if any are required for a company to issue that quantum of shares on the ASX, so above post is just a guess really.
Maybe this is a form of VAH expressing its dissatisfaction with its unsupportive shareholder ?

[blockhead]

Lots of guesswork, proposals, charts, premiums, knives (falling, bouncing and placed between ribs) and AIR rises 1.6%

Meanwhile, back at the coalface, no guesswork, no rumours, no knives and HBL ticks up just the same percentage.

Moral of the story ??

Sometimes ya moneys just better off in The Bank

[smtrader]

So some major funds just entered the market in the last 10 minutes.. across the board.. atm, tme, even air.. right now there is one buy order at 225 for 1.1milion... i dont know what happend but im taking a dive and ignoring all fundamentals and technicals... 'follow the big boys money' is what they say.. so i did :t_up:

disc. now holding

[GR8DAY]

Lots of guesswork, proposals, charts, premiums, knives (falling, bouncing and placed between ribs) and AIR rises 1.6%

Meanwhile, back at the coalface, no guesswork, no rumours, no knives and HBL ticks up just the same percentage.

Moral of the story ??

.........haha BLOCKHEAD nice one, but where's the fun in that? Clearly AIR is being traded heavily but continues with it's northern trajectory....that's gotta be saying something about underlying support and/or expectations? You wouldnt want to be caught without it at the mo IMHO. Still a lot of ground to recover for most of us. Thankfully I averaged down and now looking not too bad. Holding tight for now.

Sometimes ya moneys just better off in The Bank


.........haha BLOCKHEAD nice one, but where's the fun in that? Clearly AIR is being traded heavily but continues with it's northern trajectory....that's gotta be saying something about underlying support and/or expectations? You wouldnt want to be caught without it at the mo IMHO. Still a lot of ground to recover for most of us. Thankfully I averaged down and now looking not too bad. Holding tight for now.

[couta1]

So some major funds just entered the market in the last 10 minutes.. across the board.. atm, tme, even air.. right now there is one buy order at 225 for 1.1milion... i dont know what happend but im taking a dive and ignoring all fundamentals and technicals... 'follow the big boys money' is what they say.. so i did :t_up:

disc. now holding Index rebalancing day today, that's why.

[numbersman]

Maybe I should buy in again , now that there is a bid for 480,000 at buy price!?

[smtrader]

Index rebalancing day today, that's why.
omg what the hell is that.. im tired of learning new things (ive had a few expensive learning curves under my belt!) im almost done with getting a cpa and will also be getting a cfa and thought i have everything covered.. but every now and then something pops up.. i need some sleep!

but please couta clarify further

[couta1]

omg what the hell is that.. im tired of learning new things (ive had a few expensive learning curves under my belt!) im almost done with getting a cpa and will also be getting a cfa and thought i have everything covered.. but every now and then something pops up.. i need some sleep!

but please couta clarify further Basically in a nutshell an index rebalance is when the big boys get the chance to throw certain toys out of their cot if they hold too many of those toys as a percentage of their portfolio, they also add other toys where the percentage of those toys is too low.:cool:

[workingdad]

So some major funds just entered the market in the last 10 minutes.. across the board.. atm, tme, even air.. right now there is one buy order at 225 for 1.1milion... i dont know what happend but im taking a dive and ignoring all fundamentals and technicals... 'follow the big boys money' is what they say.. so i did :t_up:

disc. now holding

haha, maybe we both should have taken that 2.24 ;)

[smtrader]

haha, maybe we both should have taken that 2.24 ;)

Yeah or at 2.05 wouldve been awesome!


Basically in a nutshell an index rebalance is when the big boys get the chance to throw certain toys out of their cot if they hold too many of those toys as a percentage of their portfolio, they also add other toys where the percentage of those toys is too low.:cool:

thanks couta, how could i not have seen that one.. i shouldve pursued the cfa before the cpa, would've served me better. So they balance it based on market cap in the index? and they do that every end of the month?

[winner69]

Could temper any enthusiasm Singapore / Ethiad / Virgin / newcomer had

I don't think Singapore will be interested in a takeover now - or increasing their share

One less interested party in Air NZ shares

[Beagle]

Basically in a nutshell an index rebalance is when the big boys get the chance to throw certain toys out of their cot if they hold too many of those toys as a percentage of their portfolio, they also add other toys where the percentage of those toys is too low.:cool:

Hi Mate,

Nice to see you back commenting after a couple of days off and I like your description. Are you sure that was happening last this arvo ? I have it in my diary that index rebalancing occurs at close of trade on the third Friday of the last month of each quarter, maybe when I was doing some recent reading on how this black art works I got the wrong end of the stick...:confused:

Maybe what we saw towards the close today was some good old fashioned end of month window dressing...whatever it is I'll take it as I need every bit of help I can get to make this month not look quite so ugly for my portfolio.

[smtrader]

Hi Mate,

Nice to see you back commenting after a couple of days off and I like your description. Are you sure that was happening last this arvo ? I have it in my diary that index rebalancing occurs at close of trade on the third Friday of the last month of each quarter, maybe when I was doing some recent reading on how this black art works I got the wrong end of the stick...:confused:

Maybe what we saw towards the close today was some good old fashioned end of month window dressing...whatever it is I'll take it as I need every bit of help I can get to make this month not look quite so ugly for my portfolio.

8088

So the rebalancing wasnt on today, but todays prices affects rebalancing.. so there was a push to prop prices up to reduce rebalancing?? am i getting this right or am i sleep deprived...

[couta1]

8088

So the rebalancing wasnt on today, but todays prices affects rebalancing.. so there was a push to prop prices up to reduce rebalancing?? am i getting this right or am i sleep deprived... The last trading day of May is used as a reference day for data used in determining any index changes at the forthcoming review date, so in essence you are correct. PS-Toys and Cots are far easier to understand aye. PPS-Yes Roger a serious window dressing day. If anyone wants to get into this in more depth I'm going to throw all my toy planes out of the cot.:cool:

[smtrader]

The last trading day of May is used as a reference day for data used in determining any index changes at the forthcoming review date, so in essence you are correct. PS-Toys and Cots are far easier to understand aye. PPS-Yes Roger a serious window dressing day. If anyone wants to get into this in more depth I'm going to throw all my toy planes out of the cot.:cool:

boy do i regret breaking my rules all the time.. i should just take a vacation .. should've listened to massey's research 'sell in may an go away'

[Joshuatree]

I go to the source ,the NZX for any of this stuff and X div dates etc; its all there to easily confirm.
Rebalancing
Most S&P/NZX Indices are rebalanced quarterly, effective after the market close of thethird Friday of March, June, September and December. The rebalancing reference datesare after the market close on the last trading day of February, May, August andNovember, respectively. Both market capitalization and liquidity are assessed using theprevious six months’ worth of data to determine index eligibility. Shares and InvestableWeight Factor (IWF) updates are also applied regularly. The S&P/NZX Real EstateSelect Index is rebalanced semi-annually, effective after the market close of the thirdFriday in March and September. The rebalancing reference dates are after the marketclose on the last trading day of February and August respectively.
Announcements are made on the second Friday of each rebalancing month; therefore, aone-week notice period is provided before the rebalancing takes effect.
Eligible stocks are considered for index inclusion based on their rank relative to the statedquota of securities for each index within the S&P/NZX hierarchy. In order to limit thelevel of index turnover, eligible securities are only considered for index inclusion in fixedconstituent count indices once another stock is removed due to a sufficiently low rankand/or liquidity, based on the float-adjusted market capitalization. Potential indexadditions and deletions must satisfy buffer requirements in terms of the rank of the stockrelative to a given index. The buffers are established to limit the level of index turnoverthat may take place at each quarterly rebalancing, maximizing the efficiency and limitingthe cost associated with holding the index portfolio.

[Raz]

boy do i regret breaking my rules all the time.. i should just take a vacation .. should've listened to massey's research 'sell in may an go away'

Last time I took a vacation I sold out and did not catch the falling knife. Happy to cash in an average 18c per share gain today in less than a week on 225000 shares. Why worry about bank deposits this is a lot more fun! That Massey research suggests another holiday??

[winner69]

I don't think Singapore will be interested in a takeover now - or increasing their share

One less interested party in Air NZ shares

And won't that 30 cents that HNA paid be the ceiling now?

[workingdad]

And won't that 30 cents that HNA paid be the ceiling now?

May I ask the experts, is this VAH share issue to HNA in reality a deal done or is there requirements for it to happen - ie a company like VAH can simply dilute its share holders value by issuing more shares without majority shareholder support and offer something more to those share holders than simply gathering earnings from doing so?

My thoughts on the VAH sale, lots of ifs buts and maybe's but worst case is AIR doesn't shift them and they are included in the profit/loss EOY results, close today was 30c AU so round it to 33c NZ. What will be the start value to calculate the profit loss? I recall something like 50c but not sure.

If HNA are good for VAH which I presume they are, one could expect the VAH share price to continue to recover to some degree particularly if the remaining 6% HNA want to buy is an on market or perhaps they are already talking to AIR about buying this much from them to get to the 19.9% they want and AIR are selling the rest to someone else or holding onto the remainder.

I don't think this will eventuate (AIR holding on to a significant portion of VAH) and they will sell VAH and for a reasonable amount although not significantly more than 30c.

June will be an interesting month....

[777]

May I ask the experts, is this VAH share issue to HNA in reality a deal done or is there requirements for it to happen - ie a company like VAH can simply dilute its share holders value by issuing more shares without majority shareholder support and offer something more to those share holders than simply gathering earnings from doing so?

My thoughts on the VAH sale, lots of ifs buts and maybe's but worst case is AIR doesn't shift them and they are included in the profit/loss EOY results, close today was 30c AU so round it to 33c NZ. What will be the start value to calculate the profit loss? I recall something like 50c but not sure.

If HNA are good for VAH which I presume they are, one could expect the VAH share price to continue to recover to some degree particularly if the remaining 6% HNA want to buy is an on market or perhaps they are already talking to AIR about buying this much from them to get to the 19.9% they want and AIR are selling the rest to someone else or holding onto the remainder.

I don't think this will eventuate (AIR holding on to a significant portion of VAH) and they will sell VAH and for a reasonable amount although not significantly more than 30c.

June will be an interesting month....

Roger is smarter than me but as they equity account the investment then the profit/loss will be their holding % of VAH 's profit/loss for the year. The investment at this stage is a capital one.The year they sell will give a capital profit/loss on the original investment cost.

[Baa_Baa]

Last time I took a vacation I sold out and did not catch the falling knife. Happy to cash in an average 18c per share gain today in less than a week on 225000 shares. Why worry about bank deposits this is a lot more fun! That Massey research suggests another holiday??

Nice, savvy too, you should post more about your insights and trades, just saying. SP today tested resistance, pulled back and closed right where a TA would expect (anticipate, hope?, Lol) it too. Could be up tomorrow, could be a DCB and pull back further from here. Lots of coulda woulda shoulda going on today ... makes it interesting.

[winner69]

Roger is smarter than me but as they equity account the investment then the profit/loss will be their holding % of VAH 's profit/loss for the year. The investment at this stage is a capital one.The year they sell will give a capital profit/loss on the original investment cost.

When Luxon packed a sad and resigned from the Board (and Air said they were selling) Air ceased equity accounting Virgin

At the moment the holding is just held as an 'investment' (on Balance Sheet)

[Raz]

And won't that 30 cents that HNA paid be the ceiling now?

Hard to tell without knowing all the parts and players..certainly the calculus is different.

[workingdad]

Roger is smarter than me but as they equity account the investment then the profit/loss will be their holding % of VAH 's profit/loss for the year. The investment at this stage is a capital one.The year they sell will give a capital profit/loss on the original investment cost.

I see the announcement states:
"The share placement is subject to and will take place afterreceipt by HNA of regulatory approvals from Chinese authorities" This is a given I presume.
"Strategic alliance will be subject to ACCC authorisation,regulatory approvals from chinese authorities and other commercial conditionsprecedent" ACCC authorisation shouldnt be an issue but not sure about the other commercial conditions..... I guess the heads of agreement aspect allows for these to be negotiated further perhaps.

[babymonster]

Judging from the Aussie news, it's not that good for air

[workingdad]

Judging from the Aussie news, it's not that good for air


Good morning AIR, what sort of mood are we in today?

It's mixed, some articles are reporting good for AIR, some are reporting bad. All I know is I have some pretty tight stops in place so if they get triggered I will sit it out for a few days again.

[Raz]

Good morning AIR, what sort of mood are we in today?

It's mixed, some articles are reporting good for AIR, some are reporting bad. All I know is I have some pretty tight stops in place so if they get triggered I will sit it out for a few days again.

Sounds smart:-)

[kiwichick]

How can Virgin dilute existing shares? I guess I just don't understand business very well, but I believed when you listed a company, it is broken up into a certain number of shares. Those shares can be sold and traded, but the overall number never increased unless by way of a share split - is this incorrect? If so, then I can't understand why anyone would ever buy a share of a company if the value of those shares could be effectively diluted overnight (which seems to have happened with this HNA sale, diluting AirNZ's share of the company from 26% down to 22.5% according to the NZ Herald this morning).

[Biscuit]

How can Virgin dilute existing shares? I guess I just don't understand business very well, but I believed when you listed a company, it is broken up into a certain number of shares. Those shares can be sold and traded, but the overall number never increased unless by way of a share split - is this incorrect? If so, then I can't understand why anyone would ever buy a share of a company if the value of those shares could be effectively diluted overnight (which seems to have happened with this HNA sale, diluting AirNZ's share of the company from 26% down to 22.5% according to the NZ Herald this morning).

The owners of the new shares will pay for them - put equity into the company - so the company is effectively worth more and arguably no one loses

[workingdad]

Sounds smart:-)

Might not be needed. Trades through at 2.28 this morning so the battle of bears and bulls enters another day....

[Raz]

Might not be needed. Trades through at 2.28 this morning so the battle of bears and bulls enters another day....

Wells we wills see, happy to start the day out..too many mixed signals. It may be a long day with many chapters....

[Balance]

Beauty of the market - the Ozzie bears and the Kiwi bulls.

http://www.nbr.co.nz/article/air-nzs-stake-virgin-could-be-easier-sell-after-chinese-airline-buys-stake-b-189758

[workingdad]

Wells we wills see, happy to start the day out..too many mixed signals. It may be a long day with many chapters....

And that's probably the only sure thing 😜

[Balance]

Judging from the Aussie news, it's not that good for air

http://www.smh.com.au/business/aviation/virgin-australia-looks-to-1-billion-raising-after-hna-group-deal-20160531-gp891y.html

Typical of the Aussie media and commentators.

Huge assumption on their part here that Air NZ has not commenced negotiations with an interested buyer and that SIA and Etihad are but side players!

Virgin's deal with the Chinese (with Branson looking for a way out) is but one move with a few more to come. The Chinese could find themselves locked in as minority shareholder but the greater game for them is to gain control.

Let the games BEGIN!

[Raz]

That was my initial thinking...any analysis is full of assumptions unless you are at the table....

[biker]

Beauty of the market - the Ozzie bears and the Kiwi bulls.

http://www.nbr.co.nz/article/air-nzs-stake-virgin-could-be-easier-sell-after-chinese-airline-buys-stake-b-189758

I think this is very true.

.......If Air New Zealand had handled itself differently it would have had a seat in negotiating the new strategic partner. Instead, Luxon's resignation meant the airline lost any rights to be consulted on the HNA investment and strategic alliance....

Is Luxon out of his depth in this arena? Just wondering.

[Raz]

I think this is very true.

.......If Air New Zealand had handled itself differently it would have had a seat in negotiating the new strategic partner. Instead, Luxon's resignation meant the airline lost any rights to be consulted on the HNA investment and strategic alliance....

Is Luxon out of his depth in this arena? Just wondering.

They got themselves in a corner before they made an announcement to disinvest....and then one consequence leads to another. The whole situation has been poor.

[Beagle]

Good morning AIR, what sort of mood are we in today?It's mixed, some articles are reporting good for AIR, some are reporting bad. All I know is I have some pretty tight stops in place so if they get triggered I will sit it out for a few days again.

Depends whether I remembered to take my bi-polar medication today of not :lol: You've got to be able to laugh at yourself sometimes.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11648296 Herald reporting it like its a done deal. Heads of Agreement only and I'd make a small bet, (guess, really I have no idea about Australian security or company legislation so am basing this guess purely on my modest knowledge of N.Z. companies law) a deal of that size would need ratification by special resolution of existing shareholders, I cannot be sure and thus this is only speculative, but if it requires 75% shareholder approval guess who has a blocking stake.

(Disc - Still holding, this post contains some pure guesswork on my part)

[bull....]

massive share dilution coming for air nz - stake will be worth less

http://www.stuff.co.nz/business/world/80614496/air-nz-may-find-its-dummy-spit-costly-after-virgin-australia-partners-with-hna

[Balance]

massive share dilution coming for air nz - stake will be worth less

http://www.stuff.co.nz/business/world/80614496/air-nz-may-find-its-dummy-spit-costly-after-virgin-australia-partners-with-hna

Assuming the capital raising goes ahead.

[Raz]

Depends whether I remembered to take my bi-polar medication today of not :lol: You've got to be able to laugh at yourself sometimes.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11648296 Herald reporting it like its a done deal. Heads of Agreement only and I'd make a small bet, (guess, really I have no idea about Australian security or company legislation so am basing this guess purely on my modest knowledge of N.Z. companies law) a deal of that size would need ratification by special resolution of existing shareholders, I cannot be sure and thus this is only speculative, but if it requires 75% shareholder approval guess who has a blocking stake.

(Disc - Still holding, this post contains some pure guesswork on my part)

Yes they have a few hurdles to overcome on the legal framework, its tougher generally in Australia legislation wise for a major transactions than here although any shareholder blocking would have to be careful given potential solvency, at least they don't have director responsibilities unless this is been in play for some time.

Would not want to leave the aussie regulatory framework enough room to have a go.

[Beagle]

Agree Raz, reporting on this has been pretty average, sometimes as thought its already a done deal. I am sure AIR's legal counsel and directors will be considering their options.

[Balance]

Agree Raz, reporting on this has been poor. Its a long way from being a done deal and I am sure AIR's legal counsel will have plenty of work in front of him.

My reading is that the Chinese has dealt themselves into the equation and is one of the interested buyers Branson alerted to.

Remember FPA? Haier bought in (cheap) first and then, paid up for full control.

[arc]

Certainly is an interesting "First move" by the Chinese. Appears to be a strategic chess game in progress.
With large/deep enough pockets you can play the long-game and sidestep the competition.
I see NZ is slowly being ...marginalized.

[Balance]

Certainly is an interesting "First move" by the Chinese. Appears to be a strategic chess game in progress.
With large/deep enough pockets you can play the long-game and sidestep the competition.
I see NZ is slowly being ...marginalized.

Disagree with you. I believe Air NZ knew eactly what they were doing - flush out the buyers and they have achieved that.

Virgin and Branson are playing a different game - my guess is a JV between Branson and the Chinese.

[skid]

Singapore Air would have been the best case scenario,but this is by no means the worst-----just ask yourself--Would you rather have 25.9% of a dying company ,or 22.5 % of a healthy ,cashed up player?---Someone is likely to want that 22.5% pretty badly.
There may be some strategic changes,but it aint a fire sale any more folks....IMO

[Beagle]

Singapore Air would have been the best case scenario,but this is by no means the worst-----just ask yourself--Would you rather have 25.9% of a dying company ,or 22.5 % of a healthy ,cashed up player?---Someone is likely to want that 22.5% pretty badly.
There may be some strategic changes,but it aint a fire sale any more folks....IMO

I agree with your general sentiment but I think a cashed up healthy player is a bit of stretch, (yet). My own analysis some time back showed VAH need $A900m in new equity to get back to a sensible 2:1 debt equity ratio.

[arc]

Disagree with you. I believe Air NZ knew eactly what they were doing - flush out the buyers and they have achieved that.

Virgin and Branson are playing a different game - my guess is a JV between Branson and the Chinese.

Bransons ego combined with the Chinese Long-game...
just like I said... NZ will be marginalised, unless AIR makes rapid moves to king-pin the CHINA-NZ tourist market, closing the door for the Branson expansion.

But you have to ask yourself ... have these latest moves disclosed the hand of who will be (or has been selected to be) the majority player in that select market. Or is this just an "investment" of no particular consequence.

[Beagle]

Bransons ego combined with the Chinese Long-game...
just like I said... NZ will be marginalised, unless AIR makes rapid moves to king-pin the NZ tourist market, closing the door for the Branson expansion.

I'm with Balance on this one. Even if VAH can execute a capital raise of circa $A1b they are still trading on a 2:1 debt equity basis, paying huge royalties for the use for the Virgin name and burdened with a very high ratio of leased planes v one's owned. Add in a aging CEO who seems to have fiddled while Rome burned and provincial routes in Australia that have been savaged by the effects of the widespread mining collapse, international routes that are still losing money despite the low oil price and I think AIR and bang on the money to extricate themselves from that flea ridden pup.

On the other hand AIR are trading on a 1:1 debt equity basis which is very conservative for this capital intensive industry and trading very profitability. Exec summary, AIR are in a vastly stronger than VAH even after the latter has been recapitalised. (Contains colourful language to describe the real state of VAH's operation DYOR e.t.c.).

[workingdad]

I for one am certainly looking forward to some news from AIR on the VAH sale.

Although it is not easy accepting such silence from AIR on this it does give some hope that there is perhaps something on the cards already and they are not in a position to say anything with perhaps it being imminent.

Less volatile trading today which is surprising, doesn't seem like the holders or sellers are quick to budge and staring each other down.......

[arc]

I'm with Balance on this one. Even if VAH can execute a capital raise of circa $A1b they are still trading on a 2:1 debt equity basis, paying huge royalties for the use for the Virgin name and burdened with a very high ratio of leased planes v one's owned. Add in a aging CEO who seems to have fiddled while Rome burned and provincial routes in Australia that have been savaged by the effects of the widespread mining collapse, international routes that are still losing money despite the low oil price and I think AIR and bang on the money to extricate themselves from that flea ridden pup.

On the other hand AIR are trading on a 1:1 debt equity basis which is very conservative for this capital intensive industry and trading very profitability. Exec summary, AIR are in a vastly stronger than VAH even after the latter has been recapitalised. (Contains colourful language to describe the real state of VAH's operation DYOR e.t.c.).

I fully understand both of your sentiments on the "present position". I will just ride the contrary view for a while and see what eventuates.
This could get interesting. Personally I am hoping AIR trucks a plane load of PR up there and starts marking territory.

[workingdad]

I for one am certainly looking forward to some news from AIR on the VAH sale.

Although it is not easy accepting such silence from AIR on this it does give some hope that there is perhaps something on the cards already and they are not in a position to say anything with perhaps it being imminent.

Less volatile trading today which is surprising, doesn't seem like the holders or sellers are quick to budge and staring each other down.......

And this statement was about 10mins before my stop loss was kicked into gear....

[cyclist]

And this statement was about 10mins before my stop loss was kicked into gear....

Ditto. Ever feel like you are being played? I do right now.

[arc]

And this statement was about 10mins before my stop loss was kicked into gear....

Yes its a news game and a chess game.
I have +15% since mid last week on VAH. it may last a day or may not...

[workingdad]

Ditto. Ever feel like you are being played? I do right now.

I have the feeling smarter people have played a better game than I have over the last few weeks..... Certainly ended up being a lot more cautious as a result and not sure how the SP will hold if it finishes in the red today hence bailing with such a tight stop loss.

Couldn't have chosen a more volatile stock and starting to think better to cut the losses and not even try to catch the ride back up which seems about as likely as the roulette wheel at the casino.

[smtrader]

I have the feeling smarter people have played a better game than I have over the last few weeks..... Certainly ended up being a lot more cautious as a result and not sure how the SP will hold if it finishes in the red today hence bailing with such a tight stop loss.

Couldn't have chosen a more volatile stock and starting to think better to cut the losses and not even try to catch the ride back up which seems about as likely as the roulette wheel at the casino.

Should try bank stocks wbc, anz, hbl, its surprising no one comments on them in the forums, great trading stocks.


I have a question for anyone who knows please: i know some CFD providers who connect direct to exchange networks, affect the depth/liquidity as they hedge their clients positions, which i know is done on the ASX, the question is, does anyone know how purchasing shares on say AIR on ASX will eventually affect the liquidity on NZX? ..

[Baa_Baa]

I wonder sometimes about the wisdom of communicating ones trading strategy, buy/sell prices and stops on a public internet forum. Just a thought.

[winner69]

AIR will get a great price for Virgin shares - after all Luxon and his mates are great share traders and know how to get good prices for airline shares.

And Luxon seems to be one of the lucky ones in life so things will turn out good.

[Beagle]

AIR will get a great price for Virgin shares - after all Luxon and his mates are great share traders and know how to get good prices for airline shares.

And Luxon seems to be one of the lucky ones in life so things will turn out good.

Very true.

[couta1]

$2.75 for me, agree on the topping up, you don't need to make a loss, just sit tight and collect the divvy. Well now I face a dilemma, now in position to bring my average price down to around $2.40, but would make Air around 50% of my portfolio total to do it (A very balsy move even for the Couta) Better sleep on this one methinks.:eek2:

[Beagle]

FWIW - I won't go over 10% portfolio allocation these days no matter what the price does and that's with standard blood pressure pills and those special garlic tablets you recommended, (thank you) helping me too. You don't need to gamble big with your SP to have a comfortable retirement in circa 10 years time and neither do I.
(You mate, because you are a good friend, can consider that free professional advice as long as you promise not to sue me if the price rockets north soon :)).

[couta1]

FWIW - I won't go over 10% portfolio allocation these days no matter what the price does and that's with standard blood pressure pills and those special garlic tablets you recommended me helping too.
You don't need to gamble with your SP to have a comfortable retirement and neither do I. I don't worry too much about percentages if the stock is stable but this stock ain't but then again $2.40 is going to come way before $2.75. Your last sentence is very true. PS-Fortunately my blood pressure has always been good, better take the dog for a walk in the rain now.

[Nasi Goreng]

I would strongly recommend against making AIR or any other stock 50% of your portfolio. It is ok to accept a loss every now and again.

[couta1]

I would strongly recommend against making AIR or any other stock 50% of your portfolio. It is ok to accept a loss every now and again. 50% in a stock like Ryman and I wouldn't bat an eyelid( Already been there in times past)

[Snow Leopard]

Leaving couta1 to trade his way into poverty and smiling at the Ozzie press taking great delight in VAH putting one over on that nasty Air New Zealand the fact does remain that:

VAH largest single shareholder no longer has a seat on the board, and few friends where it needs them.

Best Wishes
Paper Tiger

[Bobdn]

Yes, I wonder if the Board did a debrief on that decision? It really did seem like a rash decision. Still, it might be able to be turned into a nice Harvard Business School scenerio about what not to do in a situation like that so all is not lost.

[see weed]

Hello, just bought back in at 2.23 after selling last lot 40 months ago. Now waiting for price to go down as it normally does when I buy in:).

[workingdad]

I wonder sometimes about the wisdom of communicating ones trading strategy, buy/sell prices and stops on a public internet forum. Just a thought.

Fair comment - I don't put everything I do up and having a tight stop loss is not something that would surprise, once activated cant see how it changes things for people to know but thanks for the reminder.

[Beagle]

Leaving couta1 to trade his way into poverty and smiling at the Ozzie press taking great delight in VAH putting one over on that nasty Air New Zealand the fact does remain that:

VAH largest single shareholder no longer has a seat on the board, and few friends where it needs them.

Best Wishes
Paper Tiger


Yes, I wonder if the Board did a debrief on that decision? It really did seem like a rash decision. Still, it might be able to be turned into a nice Harvard Business School scenerio about what not to do in a situation like that so all is not lost. Some people will be able to find value in the call, just not shareholders.

You good chaps assuming this heads of agreement is already done and dusted and I'd be prepared to wager you a few cold ones that a share issue of that magnitude requires a special resolution with 75% of shareholders agreeing to it. Seeing as AIR presently owns more than 25% Borgatti might have just handed our Harvard graduate a very good bargaining chip without even realising it. Back Luxon over Borgatti any day of the week, just look at the respective financial performance of the two airlines for starters !

Sometimes discretion is the better part of valour when it comes to taking excessively large positions...sometimes when you're in a hole the best thing to do is to stop digging. I think having sensible sized allocation in one's portfolio to risky volatile shares is a prudent thing for anyone, especially anyone within circa 10-15 years of their retirement.

[peat]

Leaving couta1 to trade his way into poverty


HAHAH you'll get banned coz in my view this is worse than calling someone stupid.

[Bobdn]

Hope you're right Roger, I just felt like venting a little.

Couta1, I'm with Roger and everyone else. 50% in any one stock is bonkers, in my humble opinion.

[Nasi Goreng]

50% in a stock like Ryman and I wouldn't bat an eyelid( Already been there in times past)

There may be a few paratroopers out there who don't use a spare shoot and they probably felt the same way until the first shoot fails.

[Tony Two Gloves]

You good chaps assuming this heads of agreement is already done and dusted and I'd be prepared to wager you a few cold ones that a share issue of that magnitude requires a special resolution with 75% of shareholders agreeing to it. Seeing as AIR presently owns more than 25% Borgatti might have just handed our Harvard graduate a very good bargaining chip without even realising it. Back Luxon over Borgatti any day of the week, just look at the respective financial performance of the two airlines for starters !

Sometimes discretion is the better part of valour when it comes to taking excessively large positions...sometimes when you're in a hole the best thing to do is to stop digging. I think having sensible sized allocation in one's portfolio to risky volatile shares is a prudent thing for anyone, especially anyone within circa 10-15 years of their retirement.

Hi Roger, thanks for all your informative posts, certainly take note when you are posting. Just a quickie did I read today that AIR's shareholding is currently below 25 percent in VAH after the recent Capital Raising? (now 22.50%)

[Beagle]

Hope you're right Roger, I just felt like venting a little.
Couta1, I'm with Roger and everyone else. 50% in any one stock is bonkers, in my humble opinion.

Guilty of that myself lately so I can totally relate to the reasons why you'd feel like that !


Hi Roger, thanks for all your informative posts, certainly take note when you are posting. Just a quickie did I read today that AIR's shareholding is currently below 25 percent in VAH after the recent Capital Raising? (now 22.50%)

Hi TTG,

Thanks for the vote of confidence. A binding heads of agreement is (not pretending to be an Australian securities lawyer here) in my opinion a legal document that set's out the terms of an agreement reached. It has not been put into legal effect yet and as far as I am aware for a company to do a cash issue of that size this would normally require what's known as a special resolution by the company. A special resolution requires the approval of 75% of the existing shareholders and as AIR presently own more than 25% of the shares the way forward for VAH may effectively be at the behest of AIR N.Z. who in my opinion could veto this capital raise. More likely they will use their power as leverage.
(I am basing my opinion on knowledge of the N.Z. securities laws not Australian. DYOR not to be considered a professional recommendation or advice)

[macduffy]

That's Roger's point. AIR's 25% won't be affected/diluted if the Chinese placement doesn't receive endorsement by existing shareholders.

Badly timed. Replying to Tony TG's post!

[winner69]

I think you will find unless new capital is greater than 15% shareholder approval NOT needed

It's not that straight forward - probably why the announced amount is a rather odd percentage

[workingdad]

Guilty of that myself lately so I can totally relate to the reasons why you'd feel like that !


Hi TTG,

Thanks for the vote of confidence. A binding heads of agreement is (not pretending to be an Australian securities lawyer here) in my opinion a legal document that set's out the terms of an agreement reached. It has not been put into legal effect yet and as far as I am aware for a company to do a cash issue of that size this would normally require what's known as a special resolution by the company. A special resolution requires the approval of 75% of the existing shareholders and as AIR presently own more than 25% of the shares the way forward for VAH may effectively be at the behest of AIR N.Z. who in my opinion could veto this capital raise. More likely they will use their power as leverage.
(I am basing my opinion on knowledge of the N.Z. securities laws not Australian. DYOR not to be considered a professional recommendation or advice)

I did some research and still cant answer the 75% special resolution thing but it would surprise me for VAH to have a heads of agreement if they needed AIR's approval without first getting it, where is the benefit in that for them to announce it knowing AIR wouldn't support it?

The answer may be in this but I haven't got time to look at it in depth right now.
http://www.asx.com.au/documents/rules/Chapter07.pdf

[Beagle]

You guys could well be right. I can't be bothered trying to wrap my head around the ASX rules...have to draw a line somewhere with this company (which is a bit of a black hole for me in terms of time spent at present for no reward).

[Snow Leopard]

I think you will find unless new capital is greater than 15% shareholder approval NOT needed

It's not that straight forward - probably why the announced amount is a rather odd percentage

This is correct, shareholder approval is not required to issue up to 15% of new capital in a 12 month period.

And when you do this little bit of maths:

15%/115% = ?

you get 0.13 or 13%.

Best Wishes
Paper Tiger

[winner69]

This is correct, shareholder approval is not required to issue up to 15% of new capital in a 12 month period.

And when you do this little bit of maths:

15%/115% = ?

you get 0.13 or 13%.

Best Wishes
Paper Tiger

Does save all that bother not having to go through that process of getting shareholder pprovals

Still have feeling all this not good for Air NZ

[winner69]

PT - you flown on any of these HNA planes of many guises?

[workingdad]

This is correct, shareholder approval is not required to issue up to 15% of new capital in a 12 month period.

And when you do this little bit of maths:

15%/115% = ?

you get 0.13 or 13%.

Best Wishes
Paper Tiger

Thank you PT.

I was coming back to it, had a late invite to a fishing trip to get sorted for an early start and one must prioritise these things not to mention the usual time taken for delicate negotiations with the other half to allow such a thing :scared:

Had a look at the link I posted and yes the 15% thing is in there, also of note with relevance to the intent signalled for HNA to go to 19.9%. I think they will want to go further than this down the line but the ASX requirements for a share issue like this have a restriction "An entity must not issue or agree to issue equity securities without the approval of holders of ordinary securities for 3 months after it is told in writing that a person is making or proposes to make a takeover for securities in it".

Reading this, (and correct me if I am wrong - knowledge of ASX is limited) 2 things come to mind, firstly HNA cant give notice of intent to wanting to undertake a takeover which as we know is >20% as it would void the ability to VAH to issue the shares. Secondly regarding Air's sale of their holdings, if they or perhaps an interested party had signalled to VAH that they were to purchase all of AIRs holdings (or >20% of) this in itself would constitute a takeover meaning VAH couldn't actually issue these shares....... I am not sure how this would play out if it was a party that already had a decent stake in VAH purchasing further but suspect if it met the takeover rules the same would apply.

ADDED: If AIR's legal team are reading this, perhaps a way to block the issue of the shares from VAH to HNA is to simply have a potential buyer issue a notice of intent of takeover by meeting takeover requirements and then VAH cant take the share issue to HNA any further than its current stage.... if I am reading it right but seems a bit too easy and I am not that smart :cool:

Anyway, hopefully I have better luck with the snapper than my ability to catch knives of late.

[Snow Leopard]

Does save all that bother not having to go through that process of getting shareholder pprovals

Still have feeling all this not good for Air NZ

I am not 100% sure about this but:
VAH can still do a pro-rata issue, should the board so decide, without needing shareholder approval.


PT - you flown on any of these HNA planes of many guises?

Not knowingly but the balance of probabilities is that I have.

Best Wishes
Paper Tiger

[babymonster]

A bit odd that air NZ on asx is up close to 2%.

[Snow Leopard]

Thank you PT....

....Anyway, hopefully I have better luck with the snapper than my ability to catch knives of late.

I believe that should anyone announce a takeover for VAH it now would have to be for a VAH that has been fattened by the new equity issued to HNA, I actually believe a takeover is unlikely.

I strongly suspect that once the new shares are issued and the new director is settled into his boardroom leather chair a pro-rata rights issue will be announced.

It will be a 1 for 1 at near market price and it may well be underwritten.

Best Wishes & Successful Fishing
Paper Tiger

[mondograss]

I'm assuming that HNA can't use one of it's subsidiaries to take a piece of AIR's stake in VAH without falling foul of the same takeover rules? I'm thinking Grand China Air, or Hong Kong airlines or one of the other multitude that it appears to own or have substantial interests in.

[Beagle]

To be fair PT - I did mark those posts with a heavy disclaimer and have already spent a TON of time on this company and betting a beer or two is always intended to be nothing more than a light hearted wager.

I still think this play's out okay for AIR.

[workingdad]

I believe that should anyone announce a takeover for VAH it now would have to be for a VAH that has been fattened by the new equity issued to HNA, I actually believe a takeover is unlikely.

I strongly suspect that once the new shares are issued and the new director is settled into his boardroom leather chair a pro-rata rights issue will be announced.

It will be a 1 for 1 at near market price and it may well be underwritten.

Best Wishes & Successful Fishing
Paper Tiger

Well I can honestly say the days fishing with plenty caught was better than AIR's performance today.

I am not sure what the charts are indicating but there does seem some stability even with a slow trend down its not to the degree that saw the 2.02 of last week. Call me crazy but considering re-entry again.

[Baa_Baa]

Well I can honestly say the days fishing with plenty caught was better than AIR's performance today.

I am not sure what the charts are indicating but there does seem some stability even with a slow trend down its not to the degree that saw the 2.02 of last week. Call me crazy but considering re-entry again.

Patience. Observe, learn, decide and act only when the facts present themselves that satisfy's ones investing or trading strategy. Technically AIR turned away from obvious resistance Tuesday and again yesterday and followed through today, the probability is ... to be determined individually. Perhaps some might consider moving from the zero-sum game of betting on one way or the other, towards having a game plan for either eventuality, up or down. If it goes up I will ... or if it goes down I will ... ?

[workingdad]

Patience. Observe, learn, decide and act only when the facts present themselves that satisfy's ones investing or trading strategy. Technically AIR turned away from obvious resistance Tuesday and again yesterday and followed through today, the probability is ... to be determined individually. Perhaps some might consider moving from the zero-sum game of betting on one way or the other, towards having a game plan for either eventuality, up or down. If it goes up I will ... or if it goes down I will ... ?

You make a good point and looking at the daily charts yesterday was not like the many AIR has had with gains in the morning and declines in the afternoon, yesterday the highest was at the start of the day and a gradual decline throughout it so perhaps it will slowly trickle down more. Each day gives an indication and it has had some weakness on Friday afternoons so perhaps today will be a test for it.

On the flip side is wait to long and risk missing the trading holt and subsequent rise on the news of a VAH sale which is the great unknown. I have bought and sold a number of times in the last few weeks trying to time it right and each time have either made some small gains or break even on them but theres a lot to make up for with holding on to too many on the way down at the start.

Do you think it is heading back to that near $2 resistance? I am wondering if over the next few trading days it may just test it again and the last week hasn't been a turnaround after all......

[couta1]

HAHAH you'll get banned coz in my view this is worse than calling someone stupid. In response to this post, for those interested go to the Off Market Section, then to page 8 and under the thread R.I.P Moosie have a read of post numbers 35 & 74. The above is saying the same thing in a more subtle way, is this sort of nastiness acceptable?

[mikeybycrikey]

Holy moses - 5 seats across in the middle

Sorry - off topc but interesting

Rumour has it that it will be operational for Rogers next big trip

What does this relate to? Is this about AIR? Not quite enough context.

Worst flight I ever had was in the middle of a group of five seats.

In a seat that wouldn't recline. On a completely full flight. Kept being asked if I was ok when trying to sleep with my head on the tray table.

[sharp]

Hi all

Interested to hear what your thoughts are on what the final dividend for FY16 will be given the interim was 10c/share.

Are you also anticipating a special divvy (with/without the sale of AIR's VHA holding)?

[workingdad]

Hi all

Interested to hear what your thoughts are on what the final dividend for FY16 will be given the interim was 10c/share.
Are you also anticipating a special divvy (with/without the sale of AIR's VHA holding)?

I would be interested in hearing opinions on this too.

I think a special divy would be highly likely given some of the commentary from AIR on this.

As for for The final it won't be as much as anticipated a few months ago I don't think. The settlement on the cargo thing is one impact and they seem to me to be keen on keeping the bank balance healthy going forward in anticipation of mitigating increased economic headwinds. At least they will be fully imputated

[Master98]

http://www.smh.com.au/business/aviation/air-new-zealand-still-confident-of-virgin-australia-stake-sale-despite-hna-deal-20160602-gpafuk.html

Air New Zealand still confident of Virgin Australia stake sale despite HNA deal

[Beagle]

Thanks Master98 but can you please post a link that works, I can't seem to make that one work even by cutting and pasting into my web browser ?

Special divvy and VAH sale matter are inextricably linked IMHO.

[Balance]

Thanks Master98 but can you please post a link that works, I can't seem to make that one work even by cutting and pasting into my web browser ?

Special divvy and VAH sale matter are inextricably linked IMHO.

In rugby terms, Air NZ is already committed to the sale process via CSFB (fees only if they get the deal done) and is still working towards end of June 2016.

************************************************** ************

Air New Zealand chief executive Christopher Luxon has not backed away from an earlier forecast that his airline could sell all or part of its 25.9 per cent stake in Virgin Australia by June 30 despite the Australian carrier's surprise share placement to China's HNA Aviation.

The Kiwi airline last month told investors its board ideally wanted to resolve the Virgin situation by June 30, in a move that could result in Air New Zealand paying a special dividend to its shareholders, the largest of which is the New Zealand government with a 53 per cent stake.

"Nothing has changed for us," Mr Luxon told The Australian Financial Review on the sidelines of the International Air Transport Association (IATA) annual meeting in Dublin.

"We are right in the middle of the process and obviously have got to follow it through to its logical conclusion. I appreciate there is lots of speculation but there is a big process that is going to play out and there are going to be multiple phases to it and we are just working our way through that really."
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Virgin chief executive John Borghetti said Air New Zealand, which will have its shareholding diluted as part of the placement to HNA, was not consulted before that deal was struck because Mr Luxon was no longer on the board. Mr Luxon quit the Virgin board in March after making an unsuccessful attempt to convince other directors to replace Mr Borghetti. Air New Zealand then hired First NZ Capital and Credit Suisse to assist it with selling all or part of its stake.

Mr Luxon would not say whether he believed Air New Zealand should have been consulted about the share placement to HNA. "I'm not really going to comment because there is a lot of speculation and a lot of it is not true," he said.

HNA, China Southern and Cathay Pacific are understood to have expressed interest in buying the Air New Zealand's stake. HNA is paying 30¢ a share for the Virgin placement. At that price, Air New Zealand's holding is worth $274 million.

Industry sources said Air New Zealand had been seeking a price of 40¢ per share from potential buyers – a significant premium to a trading price that reached as low as 26.5¢ before the HNA deal was announced – in a move that could have led HNA to deal directly with Virgin.

Options for Air New Zealand include selling the stake piecemeal to holders like Singapore Airlines, Etihad Airways, Richard Branson's Virgin Group and HNA. However, any deal could be complicated by Virgin's capital review process that could result in an equity raising of up to $800 million. HNA has indicated it would like to raise its stake to 19.9 per cent but it is unclear whether it will do so by buying part of the Air New Zealand stake, through an equity raising or through purchases on market or from other shareholders.

Mr Luxon said Air New Zealand would continue its joint venture with Virgin on trans-Tasman routes and cooperation on maintenance and other cost saving initiatives even if it no longer remained a shareholder in the Australian airline. The pair are currently renegotiating the terms of their alliance as part of a normal contractual process.

"The alliance is working incredibly strongly for both Virgin and Air New Zealand," Mr Luxon said. "I think both parties would strongly agree with that. The alliance preceded the shareholding. We have great relationships with the team there. It makes good sense for us to work together."

Air New Zealand is focusing heavily on picking up more Australian traffic on trans-Pacific routes including its relatively new flights to Buenos Aires and Houston. Mr Luxon said 40 per cent of the passengers to and from Buenos Aires were Australians, as were 20 per cent on the Houston route.

Air New Zealand is deepening its alliance with United Airlines through a revenue sharing pact on trans-Pacific routes from New Zealand to the United States. However, Air New Zealand chief strategy, network and alliance officer Stephen Jones said there were no plans to extend that alliance to Australia-US routes in competition with similar pacts between Qantas and American Airlines and Virgin and Delta Air Lines.

"The markets operate a little bit separately," he said. "It is quite a complex thing to be able to do that. So we are very comfortable on the current alliance on the trans-Pacific to New Zealand."

[BC_Doc]

And this is from the Australian Financial Review paid subscription a few days ago about the "blindsiding of AIR" by Virgin...




"Air New Zealand was none the wiser when John Borghetti flew to New York last week to bed down a deal with his new airline partner, China's HNA Group.
Only a handful of people knew that Borghetti had been talking to senior executives at the private Chinese aviation giant about a partnership that will bring HNA aboard Virgin's already-crowded share register with an initial 13 per cent stake (http://www.afr.com/business/transport/aviation/virgin-raises-159m-in-placement-to-hna-group-20160530-gp7pix).
The spotlight has instead been on who may buy Air New Zealand's 26 per cent stake in Virgin, as well as how much capital Borghetti will have to raise from the existing shareholders as part of a strategic review.
HNA has been interested in Virgin for some time but talks became serious only after Air New Zealand announced in late March it was parting ways with the Australian carrier. (http://www.afr.com/business/transport/aviation/air-new-zealand-has-quick-timetable-for-virgin-australia-sale-20160503-golln0)


Air New Zealand boss Christopher Luxon quit the Virgin board after demanding Borghetti step down. The Kiwi carrier's decision to review its shareholding in the airline triggered a fall in Virgin's share price. It is understood HNA approached Virgin directly not long afterwards with an offer to join forces.
Talks intensified in recent weeks but it was still uncertain over the weekend when a deal could be completed.
Borghetti and other executives already had their bags packed for the International Air Transport Association (IATA) conference in Dublin this week (http://www.afr.com/brand/chanticleer/iata-executives-meet-in-dublin-as-oil-terrorism-may-subdue-global-air-travel-20160530-gp7p0g). Those plans were cancelled after bedding down the agreement on Monday.
Air New Zealand had a hint something was coming but was unaware about Borghetti's new friendship with the Chinese until the announcement was made to the market on Tuesday. The other big stakeholders – Singapore Airlines, Etihad and Richard Branson's Virgin Group – did because they still had representatives on the board who approved the deal.

Air New Zealand will not be happy as the $159 million share placement potentially puts a 30¢-per-share ceiling on the Virgin share price and may complicate efforts to sell its stake.
Borghetti has clearly moved on from his break-up with Air New Zealand.
"This is very big. Securing a relationship with a company of this type and with this credibility in China is massive," Borghetti told The Australian Financial Review.
"I think China is the future for inbound travel and this secures our future."

There is no love lost between Virgin and Air New Zealand. Luxon was concerned abut Virgin's deteriorating financial performance and the balance sheet, while Borghetti is happy to have him off the board.
HNA will be the fifth big airline stakeholder on the Virgin board, including Air New Zealand. Its equity injection into the airline gives Borghetti additional capital at a time when he needs it most, but that does not mean the other shareholders will not be asked to stump up more funds as part of a capital review that is still some weeks away from completion. Citi analysts have estimated Virgin needs as much as $853 million in additional capital.
But for Borghetti, the HNA Group deal is about much more than a capital injection.
The lustre has gone from Borghetti's five-year transformation plan for the airline in recent months at a time when rival Qantas is performing well (http://www.afr.com/brand/chanticleer/wakeup-call-for-airlines-as-qantas-cuts-capacity-growth-with-slower-traffic-20160418-go8rem). Virgin warned earlier this month it would post a loss in the second half and forecast a full-year profit of $30 million to $60 million, well below consensus forecasts at the time of $84 million.


But for Borghetti, the HNA deal is the next chapter in the airline's growth strategy and this time he has done it without having to spend more money because of the equity injection that cemented the deal
The focus has been building up the domestic network and operating international routes (http://www.afr.com/brand/chanticleer/virgin-recovery-stumbles-as-demand-for-flights-dwindles-20160502-gojyoc) that fed into its alliance partners in Europe and the US. Borghetti says the piece that was missing was inbound Australian traffic.
HNA, which has holdings in more than 10 airlines including Hainan Airlines and Hong Kong Airlines, is a private Chinese company, not a state-owned entity. It manages 16 airports and owns ground services, travel agencies and aircraft leasing operations.
Virgin does not currently have any direct exposure to the fast-growing Chinese market and the 1.2 million tourists that visit Australia (http://www.afr.com/business/tourism/tourism-australia-to-launch-china-campaign-amid-wave-of-arrivals-20160406-go0axj) from there each year. The idea is to establish a code-share alliance, offer reciprocal frequent flyer points and daily flights between Australia and Beijing, Hong Kong and some secondary destinations in China by the first half of next year. It gives Virgin access to the distribution network in China as well, something it could not do on its own.


HNA wants to eventually build up a 19.9 per cent stake in Virgin. It will also have a representative on the board. The share placement dilutes the existing shareholders' stakes slightly: Air New Zealand's stake will fall to 22.5 per cent from 25.9 per cent, Singapore to 19.8 per cent from 22.8 per cent; Etihad to 21 per cent from 24.2 per cent and Virgin Group to 8.7 per cent from 10 per cent.
HNA may buy some of Air New Zealand's shares to get up to 19.9 per cent.
It is still unclear who will buy Air New Zealand's stake and it is interesting that HNA approached Virgin direct instead of going to Air New Zealand which already had its stock on the market. Having yet another alliance partner as a major shareholder will complicate things further but Virgin says HNA has agreed to go along with the outcome of the capital review.
The China deal is a long-term strategic story, although it gives Borghetti an immediate equity injection at a time when he needs it most.


Qantas has its own alliance with China Eastern.



Read more: http://www.afr.com/brand/chanticleer/how-virgin-australias-john-borghetti-blindsided-air-nz-with-china-deal-20160531-gp7xu7#ixzz4ATKLeTWn
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[Beagle]

Thanks guys. Safe to say the relationship between Borgatti and Luxon is not presently on a good footing.

[Snow Leopard]

Thanks guys. Safe to say the relationship between Borgatti and Luxon is not presently on a good footing.

Borghetti !

Best Wishes
Paper Tiger

[Gizzajob I can do that]

Borghetti !

Best Wishes
Paper Tiger

Yes, Mr Borgatti drives a Bugatti and Mr Borghetti will eat the spaghetti LOL

[peat]

In response to this post, for those interested go to the Off Market Section, then to page 8 and under the thread R.I.P Moosie have a read of post numbers 35 & 74. The above is saying the same thing in a more subtle way, is this sort of nastiness acceptable?

jeez , hand in your man card Couta.

hows that diversification working out for you ?

[couta1]

jeez , hand in your man card Couta.

hows that diversification working out for you ? My man card has written on it ' Treat others as you would like to be treated yourself, always showing basic courtesy and respect when it is in your power to do so'

[BIRMANBOY]

Certainly a concept that we all should aspire to and thanks for reminding me of that Couta...no doubt we all probably could do a bit better in that area if we were honest with ourselves. Somewhat ironic in that "manning up" has somehow become allied to being honest and open and doing the right thing as a male and yet most of the aggression and violence in society is perpetrated by men...go figure huh?

My man card has written on it ' Treat others as you would like to be treated yourself, always showing basic courtesy and respect when it is in your power to do so'

[skid]

My man card has written on it ' Treat others as you would like to be treated yourself, always showing basic courtesy and respect when it is in your power to do so'

It was probably a kind of 50/50 remark that may have been aimed more at your investing techniques than you as a person--might be good for us all to move on--we have probably all made posts that were a bit iffy at times.
I agree ..poor Moossie has taken far more flak than many of us and more than he deserved---I liked it better when he was around---anyone who signed his name on reputation marks ,back when they were anonymous gets a tick in my book.
I learned alot from his involvement in DIL.

I think AIR management has stumbled a bit of late but its still a bit undervalued in the sense that there must be alot who are waiting to jump if the VAH results pan out ok.
Of course no one knows for sure, but there is potential for a bit of a stampede on the up side---time will tell

[percy]

It was probably a kind of 50/50 remark that may have been aimed more at your investing techniques than you as a person--might be good for us all to move on--we have probably all made posts that were a bit iffy at times.
I agree ..poor Moossie has taken far more flak than many of us and more than he deserved---I liked it better when he was around---anyone who signed his name on reputation marks ,back when they were anonymous gets a tick in my book.
I learned alot from his involvement in DIL.

I think AIR management has stumbled a bit of late but its still a bit undervalued in the sense that there must be alot who are waiting to jump if the VAH results pan out ok.
Of course no one knows for sure, but there is potential for a bit of a stampede on the up side---time will tell

Since he left Moossie and I have been in contact via email.I value his opinion.A very clever young person.I am sure we would all benefit from his input, should he ever return.
I also value Couta1's honest opinions,although I too have often doubted his techniques.
I do look forward to meeting him sometime.,as I do all the Wellington ShareTraders.

[Baa_Baa]

A breath of fresh AIR for shareholders having an up week after 7 straight down weeks. Looking at the chart it was quite remarkable to see the low last week push down to the H&S breakdown targets and bounce on the 50% Fib retrace of the 4-year bull move, then this week falter at the 38.2% Fib, though pulling back a bit, still closing up for the week.

[Leftfield]

A breath of fresh AIR for shareholders having an up week after 7 straight down weeks. Looking at the chart it was quite remarkable to see the low last week push down to the H&S breakdown targets and bounce on the 50% Fib retrace of the 4-year bull move, then this week falter at the 38.2% Fib, though pulling back a bit, still closing up for the week.

and your future prediction is.......?????

[Baa_Baa]

and your future prediction is.......?????

TA's don't do predictions, that's for soothsayers. The probability that sentiment reversed is 100% as the week was up, though it weakened progressively from mid week to EOW close.

Bullish view .. I would expect stern resistance (selling) at $2.35 to $2.40 if it gets back there though if it folds, Bearish view .. expect a retest of $205 with solid support (buying) at $1.80-$1.75.

Some may disagree but I think for the active investor it's always worthwhile having two strategies, the up one and the down one. That way you're always half right and can ride the winning side.

[Marilyn Munroe]

The competitive pressure on Cullen Airlines continues;

Emirates will start direct daily Airbus A380 services on the world’s longest non-stop route from Dubai to Auckland in New Zealand in December 2016, airline president Tim Clark said on Thursday.

http://gulfnews.com/business/aviation/emirates-to-launch-daily-a380-flights-to-auckland-1.1839712

Boop boop de do
Marilyn

[Raz]

The competitive pressure on Cullen Airlines continues;

Emirates will start direct daily Airbus A380 services on the world’s longest non-stop route from Dubai to Auckland in New Zealand in December 2016, airline president Tim Clark said on Thursday.

http://gulfnews.com/business/aviation/emirates-to-launch-daily-a380-flights-to-auckland-1.1839712

Boop boop de do
Marilyn

To add to this

http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11650287

I think the comment section is more interesting than the article, re Chris's comment... this sums up what i have been wondering the last couple of day....

[777]

The competitive pressure on Cullen Airlines continues;

Emirates will start direct daily Airbus A380 services on the world’s longest non-stop route from Dubai to Auckland in New Zealand in December 2016, airline president Tim Clark said on Thursday.

http://gulfnews.com/business/aviation/emirates-to-launch-daily-a380-flights-to-auckland-1.1839712



Boop boop de do
Marilyn

To correct your posting.

Emirates will upguage their Direct Auckland to Dubai services from a B777LR to an Airbus A380.

[h2so4]

To add to this

http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11650287

I think the comment section is more interesting than the article, re Chris's comment... this sums up what i have been wondering the last couple of day....

Yes we have been kept in the dark long enough. It makes you wonder if AIR had any potential sale discussions behind closed doors before making the announcement.

[Leftfield]

Thanks Baa Baa. Agree predictions very tricky/dangerous. Much depends on the sale of Virgin and who knows how this will pan out.

[Zaphod]

To add to this

http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11650287

I think the comment section is more interesting than the article, re Chris's comment... this sums up what i have been wondering the last couple of day....

Strategically it may be important, but how much more of Air NZ's cash will VAH burn before turning a profit? Air NZ have no doubt weighed this in making their decision.

[Beagle]

That heads of agreement could just as easily flush out a full takeover offer from Singapore airlines as any other outcome. No doubt AIR's advisors have been told binding offers must be tabled about mid June, allowing sufficient time for a decent price haggle. We'll know the outcome soon enough. VAH's woeful financial performance at a time of low oil prices speaks for itself and I remain happy AIR are trying to extricate themselves from that pup which could easily turn into Ansett MK2. Some interesting stories on MSN money about how Qatar are mowing Delta's grass e.t.c.e.t.c.

Fears of impact on Delta and American airlines...trading on PE's of late 5's early 6's and price to book of circa 2.5-3 times. Hmmm Interesting comparison to AIR's fundamental's.

[h2so4]

That's true but I would be happier if VAH was performing. Being the banker of a loss making airline and then selling almost feels like a mortgagee sale. If they sell at a loss how will that reflect on AIR's management?

[axe]

That's true but I would be happier if VAH was performing. Being the banker of a loss making airline and then selling almost feels like a mortgagee sale. If they sell at a loss how will that reflect on AIR's management?

Has the board of VAH acted in the best interest of all of VAH shareholders???? With a large holder wanting to exit was it really best to dilute holders and issues to shares at such a low price.
Could they not have done a rights issue and had HNA underwrite it @ .30 to give all shareholders an equal chance?

[workingdad]

That heads of agreement could just as easily flush out a full takeover offer from Singapore airlines as any other outcome. No doubt AIR's advisors have been told binding offers must be tabled about mid June, allowing sufficient time for a decent price haggle. We'll know the outcome soon enough. VAH's woeful financial performance at a time of low oil prices speaks for itself and I remain happy AIR are trying to extricate themselves from that pup which could easily turn into Ansett MK2. Some interesting stories on MSN money about how Qatar are mowing Delta's grass e.t.c.e.t.c.

Fears of impact on Delta and American airlines...trading on PE's of late 5's early 6's and price to book of circa 2.5-3 times. Hmmm Interesting comparison to AIR's fundamental's.

Correct me if I am wrong but isn't Singapore on the board of VAH as the 3rd largest shareholder? if so why would they be involved in allowing HNA to buy in if they wanted to start a takeover? I thought them likely prior to the HNA announcement but not so sure now.

The more I think about it from my minimally experienced perspective the more I think HNA buying into VAH has been a big negative for AIR selling its stake with regard to not only price but potential buyers who would be doing it for code sharing that wont be straight forward now HNA are in the mix as well.

[winner69]

We had our long weekend - now NZ markets got a bit of catching up to do.

Good day in ASX yesterday and US up overnight - the world is happy again

Reckon AIR will get to 230 today

[couta1]

We had our long weekend - now NZ markets got a bit of catching up to do.

Good day in ASX yesterday and US up overnight - the world is happy again

Reckon AIR will get to 230 today Not that happy:eek2:

[winner69]

Not that happy:eek2:

I better stop getting excited about AIR share price eh - it seems to have a mind ofbits own.

As Yogi said 'its tough to make predictions, especially about the future'. I get what he meant now.

[Raz]

I better stop getting excited about AIR share price eh - it seems to have a mind ofbits own.

As Yogi said 'its tough to make predictions, especially about the future'. I get what he meant now.

Yeah do yourself a favour and don't get excited:-) great performance today ahh

[workingdad]

Is it going to be another one of those days with bargain hunters before lunch holding price then another drop in the afternoon, yesterdays volume was concerning and makes me wonder if that $2 mark will be tested by the end of the week or are we going to have a good bounce back today?

[BlackPeter]

Is it going to be another one of those days with bargain hunters before lunch holding price then another drop in the afternoon, yesterdays volume was concerning and makes me wonder if that $2 mark will be tested by the end of the week or are we going to have a good bounce back today?

No idea what AIR is going to do today ... but overall - sitting in a highly cyclical industry with business at its peak; Oil price going up; Recent board decisions clearly not at it best (these guys must have been sleeping in the cockpit looking at the Virgin story) - i.e. in the long term I would expect them to keep dropping before they start through for the next cycle.

I normally consider to buy AIR if the SP is well below the net tangibles and business is really poor - that's the time to get in, not now.

Discl: used to hold AIR several times over the last 2 decades (not now) - and keep them in high regard ...

[workingdad]

No idea what AIR is going to do today ... but overall - sitting in a highly cyclical industry with business at its peak; Oil price going up; Recent board decisions clearly not at it best (these guys must have been sleeping in the cockpit looking at the Virgin story) - i.e. in the long term I would expect them to keep dropping before they start through for the next cycle.

I normally consider to buy AIR if the SP is well below the net tangibles and business is really poor - that's the time to get in, not now.

Discl: used to hold AIR several times over the last 2 decades (not now) - and keep them in high regard ...

Yeah that whole scenario with VAH has made them look a bit average alright.

Looking at the chart the last 4 trading days are on that steady decline (although one of them was a gain of 2c for the day it was a very narrow trading range and fits within the line of heading down further. I just keep thinking they are worth more and if the VAH thing does pan out ok then it is a good divvy to jump in on. Nearly bought back in again yesterday but held off and just scratching my head to the point flipping a coin would be as likely as getting it right as I have of late with AIR.

[Biscuit]

Nearly bought back in again yesterday but held off and just scratching my head to the point flipping a coin would be as likely as getting it right as I have of late with AIR.

I think that is the point. Unless you are an insider and know something the rest of us don't, buying now is a pure gamble in the short term on what you think will happen with the VAH stake.

[BlackPeter]

Yeah that whole scenario with VAH has made them look a bit average alright.

Looking at the chart the last 4 trading days are on that steady decline (although one of them was a gain of 2c for the day it was a very narrow trading range and fits within the line of heading down further. I just keep thinking they are worth more and if the VAH thing does pan out ok then it is a good divvy to jump in on. Nearly bought back in again yesterday but held off and just scratching my head to the point flipping a coin would be as likely as getting it right as I have of late with AIR.

Looking at fundamentals (and ignoring the cyclical nature of the industry) - yes some analysts see them still as undervalued; On the other hand - they often do (and sometimes they are right and sometimes they are not).

However - looking at the graph ... I'd call that ugly. Sure - any down trend has to stop at some stage, but why do you think this is now?
8096

Not even the indicators appear to move towards "oversold". Why do you think the trend should turn now?

8097

And yes - high divvies are nice, but if they are not sustainable, than they are frequently just the last hurrah of a board trying to keep the SP up - no matter what the cost. Sure - at current the forward PE of AIR looks really nice (3.9), but if you look at the long term PE (14.5 - not that flash) and consider that they will have as many years with worse PE than average than better - are you sure that next years divvies will still justify the current share price?

[Beagle]

AIR's projected NTA as at 30 June 2017 is $2.27 according to consensus forecast. So all their intellectual property is worthless according to Mr Market. Sure everyone is down on them at the moment and certainly not without reason, (especially management selling), but I for one know that none of the other airlines I follow are trading anywhere near NTA so I'll continue to hold knowing that while almost every man and his dog, (myself included) have been extremely disappointed with some of their decisions and actions lately, their strategic direction to extricate themselves from Virgin is something I agree with even if the execution is looking untidy and uncertain.

Its always darkest before the dawn. (DYOR and all my other usual disclaimer comments)

[Biscuit]

Its always darkest before the dawn.

Interesting concept and although seemingly unlikely, it may even be literally true at times: “…during a full moon, the moon rises and sets in exact opposition to the sun (well, not exactly - approximately and dependent on your location on earth). Which is to say the full moon will be setting just before the dawn, and thus contribute to the sky being "darker" just before the dawn.That only works close to full moon though. There are also periods where the night is darker right after dusk than before dawn, making the statement rather wrong.”

[Nasi Goreng]

Well 205 is the resistance, if it can hold onto anything above that and break out to 2.35 then it will give some strong support (which will seem pretty obvious if its in the 230s). If it falls below 205, then we might have not yet have seen the sky at its darkest... 180 starts to look possible again.

[Nasi Goreng]

[QUOTE=Roger;623843]AIR's projected NTA as at 30 June 2017 is $2.27 according to consensus forecast. So all their intellectual property is worthless according to Mr Market. Sure everyone is down on them at the moment and certainly not without reason, (especially management selling), but I for one know that none of the other airlines I follow are trading anywhere near NTA so I'll continue to hold knowing that while almost every man and his dog, (myself included) have been extremely disappointed with some of their decisions and actions lately, their strategic direction to extricate themselves from Virgin is something I agree with even if the execution is looking untidy and uncertain.

Yes yes yes, I agree its undervalued but this NTA, is it before the write down they will need to do for VAH, and before the $50M they will pay to regulators. They have considerable debt too which no one seems to talk about, I'm going from memory here but isn't it around $5B? If it was me, I would be paying that down with any cash that I got from VAH sale.

[Beagle]

https://answers.yahoo.com/question/index?qid=20090207153313AAaYQuN In the most unlikely event that anyone else is interested in drilling right down into this well known proverb / saying / cliché, call it what you will.

N.G. AIR is one of the very few airlines with an investment grade credit rating and run a conservative balance sheet for this capital intensive industry. The forecasted NTA as at 30 June 2016 is based on consensus analyst expectations including accrued and undistributed profit to that date and includes estimates of current year and FY17 profits which would be out by any variation one way or another including the matters you've mentioned. Actual NTA as at 31 December 2015 was $1.75 IIRC. Hope that helps :)