AIR - Air NZ.

[thestg]

How about a little surge up before close:). Come on now, 35c div divity div divity div div dere,

And another one tomorrow 8-)

[winner69]

Excitment still abounds with the AIR share price but it has been been rather quiet here today

Maybe a case of a few heeding advice given in the Bible -- be careful my child, for posting too often on Sharetrader, and much study wears you out.
(winner version of Ecclesiastes 12.12)

[blackcap]

Excitment still abounds with the AIR share price but it has been been rather quiet here today

Maybe a case of a few heeding advice given in the Bible -- be careful my child, for posting too often on Sharetrader, and much study wears you out.
(winner version of Ecclesiastes 12.12)

I hope you heed your advice winner :) (by the way nice way to apply Ecclesiastes 12:12)

[winner69]

Where is everybody on what could turn out to be a momentous day

The silence is deafening

Heeded my advice about too much posting tires the flesh? .......or is there some ulterior motives like protest action or something?

[sb9]

Where is everybody on what could turn out to be a momentous day

The silence is deafening

Heeded my advice about too much posting tires the flesh? .......or is there some ulterior motives like protest action or something?

May be people have resigned to the fact that 240 is at best it can get to before it goes ex-div...

[Jantar]

Where is everybody on what could turn out to be a momentous day

The silence is deafening

Heeded my advice about too much posting tires the flesh? .......or is there some ulterior motives like protest action or something?
It looks like my hope of buying a couple of thousand more tomorrow at $1.92 have gone out the window.

[Beagle]

Where is everybody on what could turn out to be a momentous day

The silence is deafening

Heeded my advice about too much posting tires the flesh? .......or is there some ulterior motives like protest action or something?

Big day alright, the biggest dividend as a percentage of the share price of any share I can recall...probably been bigger at some stage but I can't remember back that far.
Important milestone for the company, in effect they have said there will be no more fishing expeditions of investments in associate overseas airlines for the foreseeable future and that's a very good thing as far as I'm concerned.
Also after observing this company very closely for many years I have noticed a subtle change from expansion, expansion expansion to a far more measured approach in recent months and a real change in emphasis towards paying high sustainable dividends across the cycle. It appears clear the Govt has said there will not be an Ansett Mk3.
I applaud current management for having the gonads to clean up Rob Fyfe's and the some previous directors flawed mess with Virgin and continue to believe Virgin's business model is systemically flawed.

As posted recently, its rare to see FA, TA and now dividend stripping all lining up beautifully. I continue to believe ex dividend SP performance will be sound.

[GR8DAY]

........do we go x tomorow??

[see weed]

.
........do we go x tomorow??
Yes, today is your last chance for big div, so be in before 5pm. Nibble nibble nibble;).

[Raz]

At the minute its all been said and all negative angles exhausted ??

Wife planning a long weekend in Dubai with the girls so she not watching...

[winner69]

Just saw one of our AIRplanes come into land at WLG and then decide to abort

Wondering if he going to try again?

Hope things not this rough on markets for AIR tomorrow

[bull....]

looking like ex div at the moment will be around 2.05 - 2.08 funny enough support levels on the charts

[sb9]

Hope things not this rough on markets for AIR tomorrow

Whatever happens today to AIR's price, am not expecting it to trade lower than 210 tomorrow, any lower level sells will be snooped up by bargain hunters in this low interest environment.

[Snow Leopard]

https://youtu.be/Duris_3coHU

Best Wishes
Paper Tiger

[winner69]

Dividend probably in bank on same day as national super payday .....super all round

Might gorge out - both scallops and oysters with the chips for lunch on the beach -- and sneak some decent wine in a plain pack because alcohol not allowed in public eh

Can't all have a long week end in Dubai like Mrs Raz

[winner69]

https://youtu.be/Duris_3coHU

Best Wishes
Paper Tiger

Pretty crappy ad Paper Tiger

Love this rave -

American Airlines’ new ad campaign celebrates people from all walks of life – our customers and employees – traveling on American.

As the world’s largest airline, with the best network, youngest fleet and competitive product, we need to focus on the people and the experiences we serve them to set us apart from the competition. American’s customers and employees all impact the travel experience. We’re celebrating the ways they elevate themselves from good to great flyers.

We developed this campaign from the inside out, listening to our employees and customers to discover what sets us apart. Our goal is to be the greatest airline in the world, by being the airline employees want to work for, customers want to fly and where investors want to put their money.

Their previous tag line was Going for Great - did they give up on that cause it wasn't happening?

[see weed]

If an outside party came in to buy 100% of AIR.....a takeover bid including the govt share, what would be your bottom dollar? How much would you sell your shares for?:D.

[winner69]

Mind you there are some stunning pictures in their new print ads

[winner69]

If an outside party came in to buy 100% of AIR.....a takeover bid including the govt share, what would be your bottom dollar? How much would you sell your shares for?:D.

$2.50 would be OK

[Jantar]

If an outside party came in to buy 100% of AIR.....a takeover bid including the govt share, what would be your bottom dollar? How much would you sell your shares for?:D.To match the current bank interest rates $5.50 would be my minimum.

[stoploss]

Big day alright, the biggest dividend as a percentage of the share price of any share I can recall...probably been bigger at some stage but I can't remember back that far.
Important milestone for the company, in effect they have said there will be no more fishing expeditions of investments in associate overseas airlines for the foreseeable future and that's a very good thing as far as I'm concerned.
Also after observing this company very closely for many years I have noticed a subtle change from expansion, expansion expansion to a far more measured approach in recent months and a real change in emphasis towards paying high sustainable dividends across the cycle. It appears clear the Govt has said there will not be an Ansett Mk3.
I applaud current management for having the gonads to clean up Rob Fyfe's and the some previous directors flawed mess with Virgin and continue to believe Virgin's business model is systemically flawed.

As posted recently, its rare to see FA, TA and now dividend stripping all lining up beautifully. I continue to believe ex dividend SP performance will be sound.

Just thinking this dividend including the special will be more than some smart investors paid for their shares before Aunty Helen stepped up to the plate.

[blackcap]

Just thinking this dividend including the special will be more than some smart investors paid for their shares before Aunty Helen stepped up to the plate.

Was there not a consolidation a few years back... like 5 for 1 or something? Someone please help me out, purely from memory. But still a stellar run since then. I can remember buying and selling the AIRVA and AIRVB shares back then for 18 odd cents.

[RGR367]

If an outside party came in to buy 100% of AIR.....a takeover bid including the govt share, what would be your bottom dollar? How much would you sell your shares for?:D.

As I've just used a fifth of the money I'm expecting from NPX to buy AIR last Friday, even at my acquisition cost of just $2.275 would be just as splendid as like being given a business class seats to UK for the whole family :t_up:

[Snow Leopard]

Just thinking this dividend including the special will be more than some smart investors paid for their shares before Aunty Helen stepped up to the plate.

That would have been before the share consolidation (Monday 23rd August 2004).

The cheapest the current shares have been on market is $0.75 on the 3rd, 4th & 6th of March 2009.

Oh to have bought some then, eh!

Best Wishes
Paper Tiger

[winner69]

That would have been before the share consolidation (Monday 23rd August 2004).

The cheapest the current shares have been on market is $0.75 on the 3rd, 4th & 6th of March 2009.

Oh to have bought some then, eh!

Best Wishes
Paper Tiger

Wonder what the PE ratio / dividend was at 75 cents back then?

[Arbroath]

[QUOTE=Paper Tiger;635861]That would have been before the share consolidation (Monday 23rd August 2004).

The cheapest the current shares have been on market is $0.75 on the 3rd, 4th & 6th of March 2009.

Oh to have bought some then, eh!



Even better to have bought them for around 90 cents in mid-2012 after making good gains in other stocks for 3 years post the GFC lows in March 2009.

Isn't hindsight great! I only got on the train around $1.65 in late 2013 and happy with the divi's paid since then...

[Snow Leopard]

Wonder what the PE ratio / dividend was at 75 cents back then?
FY:: EPS::: NEPS:: DIV::: NTA:: NPAT:
2008 $0.207 $0.139 $0.085 $1.45 $218m
2009 $0.020 $0.111 $0.065 $1.47 $21m

NEPS = Normalised (Fudged) EPS;

Best WIshes
Paper Tiger

[winner69]

FY:: EPS::: NEPS:: DIV::: NTA:: NPAT:
2008 $0.207 $0.139 $0.085 $1.45 $218m
2009 $0.020 $0.111 $0.065 $1.47 $21m

NEPS = Normalised (Fudged) EPS;

Best WIshes
Paper Tiger




So cheaper today?

[Snow Leopard]

So cheaper today?

Well that will depend upon you definition of cheap :).

I have no idea what the company was valued at, by those who job it was to value them, at that time.

But if we assume that my valuation curve posted earlier is correct (and why not) then tomorrow ex-div it has a value (determined by what seems the most logical method to me) of:

$2.192

on it's way to

$2.407 next 30-Jun.

Best Wishes
Paper Tiger

[Beagle]

Picked my 87 year old Mum up from the Airport today after coming back from her brothers funeral in Dunedin. She needs wheelchair assistance these days. I asked her how AIR staff treated her. She said they were really lovely and caring and really looked after her both down a few days ago and back today. AIR staff made me proud to be a shareholder today.

[Raz]

Good to hear Rodger, I have found the domestic staff amazing..not sure why that doesn't always translate to the international crews...it like two cultures actually.

[Tony Two Gloves]

Whoa - where did all those buyers just come from.......

[Beagle]

Tired, can someone please remind me when the dividend payment date is ?

[Fox]

Tired, can someone please remind me when the dividend payment date is ?
19th September

[see weed]

Whoa - where did all those buyers just come from.......
Don't know, but higher the close the better for all shareolders. Sold down 15000 at 2.40 to get av pr down to 2.147, not selling any more today.

[Beagle]

19th September

Nice, thanks, might fly down to Queenstown and spend the day with my good mate Couta1 who'll be on his second skiing holiday down there this winter.

[RTM]

I have a similar story about my Mum who was recently discharged from Hutt Hospital and needed to go straight to the airport for a flight to Auckland. She needed wheel chair assistance. She was really well looked after through the whole process and that made me happy to be a shareholder as well. Great. So happy that I have a buy order in at 193 for tomorrow. Yeah right I hear you all say.
Cheers
RTM

[workingdad]

Nice, thanks, might fly down to Queenstown and spend the day with my good mate Couta1 who'll be on his second skiing holiday down there this winter.

Heading to queenstown next weekend for 3 days, hope to get a couple in skiing if the weather is right. Staying at the Sofitel for a lazy spa with the mrs after the slopes. Been a while since I was there and last time was working so looking forward to leaving the kids behind for once and some selfish time.

[simjp81]

So. There we go. Big question is what will it open at tomorrow.

[see weed]

And now for all the tomorrow predicts.....open 2.08 close 2.15c ;).

[sb9]

So. There we go. Big question is what will it open at tomorrow.

Well closed at 241, adjust divvy of 35c, that's 206 to kick things off at least...my pick is it'll get past 210 very quickly.

[Beagle]

So there we have it, closed at $2.41. FA and D.S. been thoroughly discussed but interestingly the clear break through the 100 day moving average now looks like a well entrenched new pattern. We've had five clear trading says now and volumes have been consistently at or over 4 million shares a day, about twice the average daily volume based on last time I checked the average which I admit was a little while ago.

Clear and rising break on much stronger than usual volumes so I expect the SP dividend adjusted to continue to follow the break trend. I expect it to open tomorrow at about $2.06 and find support about that level and see it build a new base from there and gradually recover the dividend paid. Stock offers what management believe to be a sustainable fully imputed dividend across the cycle of 20 cps so that's 20/0.72 / 206 = 13.48% gross dividend yield going forward...at a time when interest rates are the lowest they've been in sixty years. I calculated a while back they have net negative capex of $50m over the remainder of the fleet upgrade cycle for the next 3 years, (based on 71 cents US), and then 5-6 years of tremendous free cash flow. Obviously they're in an even better capex position if we sustain 74 cents U.S. or head even higher.

Enjoy your massive dividend folks :)

[Gringo]

So it's ex-dividend from now on, so buying tomorrow = no dividend on those shares later this month. But does this mean that we can definitely sell tomorrow morning and retain the dividend on those shares sold?? Thanks. I'm happy with that closing price so no big drop under 200 tomorrow... Need to reduce a bit now and wondering if 10am tomorrow best, or wait a few days?

[simjp81]

I'm hoping for a quick recovery to somewhere in the 220's. Time will tell.

Enjoy those dividends everyone. And thanks for all the responses and conversation over the last month or so leading up to this.

[Cool Bear]

hey guys, share is still trading in OZ, now at 235. If it close at that, then that is NZ242.6 less 35 is 208. May be a last minute rush and a couple cents up?

[Raz]

Dividend probably in bank on same day as national super payday .....super all round

Might gorge out - both scallops and oysters with the chips for lunch on the beach -- and sneak some decent wine in a plain pack because alcohol not allowed in public eh

Can't all have a long week end in Dubai like Mrs Raz

A pleasing day for AIR, I will be keeping a wary eye for anyone eating scallops and oyster with chips on Lake Wakatipu in the coming week after their luxury day of skiing, actually there is enough of us floating about that we could have a Queenstown share trader meeting. Nice time of year down in Central Otago generally in September (except people trying to fly out tonight) and always attend a annual conference here mid September every year.

Tomorrow will be an more interesting day for AIR.

[Snow Leopard]

...I calculated a while back they have net negative capex of $50m over the remainder of the fleet upgrade cycle for the next 3 years, (based on 71 cents US)...

I do not see how you could have arrived at that figure:

The annual results presentation Slide 21 gives aircraft+associated assets capex of approx:
$650M + $700M + $570M = $1,920M

less progress payments of $420 (FS Note 11) = $1,500M

depreciation for same will be of the order of:
$380 + $400 + $420 = $1,200M

a net growth capex (outflow) of $300M.

They will probably 'borrow' half of that.

They had total future commitments for aircraft+ of $2,210M (FS Note 22) which are otherwise not on the books.

Best Wishes
Paper Tiger

[simjp81]

hey guys, share is still trading in OZ, now at 235. If it close at that, then that is NZ242.6 less 35 is 208. May be a last minute rush and a couple cents up?

How's it looking Cool Bear?

[777]

Closed A$2.34

[RTM]

So there we have it, closed at $2.41. FA and D.S. been thoroughly discussed but interestingly the clear break through the 100 day moving average now looks like a well entrenched new pattern. We've had five clear trading says now and volumes have been consistently at or over 4 million shares a day, about twice the average daily volume based on last time I checked the average which I admit was a little while ago.

Clear and rising break on much stronger than usual volumes so I expect the SP dividend adjusted to continue to follow the break trend. I expect it to open tomorrow at about $2.06 and find support about that level and see it build a new base from there and gradually recover the dividend paid. Stock offers what management believe to be a sustainable fully imputed dividend across the cycle of 20 cps so that's 20/0.72 / 206 = 13.48% gross dividend yield going forward...at a time when interest rates are the lowest they've been in sixty years. I calculated a while back they have net negative capex of $50m over the remainder of the fleet upgrade cycle for the next 3 years, (based on 71 cents US), and then 5-6 years of tremendous free cash flow. Obviously they're in an even better capex position if we sustain 74 cents U.S. or head even higher.

Enjoy your massive dividend folks :)

Logically you are perhaps right. Working against the logic are all the unknowns in the airline industry....
Which way is the dollar to go ?
Fuel prices
Intense competition already signalled.
USA Elections.
Summer political unrest in Europe with pressure in immigration again.
Brexit
etc.
I think these and other factors will weigh on the AIR share price a bit more heavily than you perhaps have allowed for.
Yes...I will enjoy my dividend as well. Great !

RTM.

[Beagle]

I do not see how you could have arrived at that figure:

The annual results presentation Slide 21 gives aircraft+associated assets capex of approx:
$650M + $700M + $570M = $1,920M

less progress payments of $420 (FS Note 11) = $1,500M

depreciation for same will be of the order of:
$380 + $400 + $420 = $1,200M

a net growth capex (outflow) of $300M.

They will probably 'borrow' half of that.

They had total future commitments for aircraft+ of $2,210M (FS Note 22) which are otherwise not on the books.

Best Wishes
Paper Tiger

Agree capex for next 3 years to ostensibly finish the fleet modernisation programme is $1920m less deposits paid of $420m = Net $1,500m

Depreciation estimates vary considerably in your analysis to mine. My estimate is based on increasing depreciation as the fleet is modernised.
Depreciation in Fy16 was $465m and in Fy15 $402m so you can see a clear trend up as the fleet replacement programme progresses.

Keep in mind 3 new dreamliners are scheduled for delivery early in the Fy17 year and these are very weighty capex items.
My estimates for depreciation are as follows FY17 $500m, (Depreciation is calculated monthly so we have most of the year for the 3 new dreamliners), FY18 $520m and FY19 $540m. Total estimated depreciation $1,560m over the 3 years. (If anything I think the risk to my depreciation numbers are they are a bit on the light side). They will have 9 new Dreamliners in their fleet by about Xmas.

Yes depreciation will be higher but fuel and maintenance costs will be a lot lower, (especially maintenance as these need no scheduled heavy maintenance for the first nine years)
These new aircraft position the company very well going forward.

At 71 cents U.S. I have them at circa negative $50-60m capex for the next 3 years. Capex will be quite a bit less if our dollar keeps its upward momentum.

After that we're looking at 5-6 years of ~ $500m a year negative capex based on known scheduled deliveries. More special dividends ?

I trust this explains where we differ in our assumptions.

RTM - Agreed all those factors are relevant but my position is that the very modest forward PE already fully reflects those risks. Keep in mind the average forward PE for the NZX50 is ~20 so AIR's trading on less than one third of that and around a PE level of half (5.8 last time I crunched the numbers) its ten year average PE 11, (I would debate a normal PE is now 12 given the lowest interest rates in 60 years.

[Snow Leopard]

...Depreciation estimates vary considerably in your analysis to mine. My estimate is based on increasing depreciation as the fleet is modernised.
Depreciation in Fy16 was $465m and in Fy15 $402m so you can see a clear trend up as the fleet replacement programme progresses....

You are using the wrong deprec numbers. Yours are total for all assets and not just for the aircraft, engines etc.

Best Wishes
Paper Tiger

[Beagle]

Ah yes.

Revised aircraft and associated spares depreciation
2015 actual $324m
2016 actual $383m
2017 estimate $419
2018 estimate $457
2019 estimate $489

My revised net capex next 3 years $135m assuming an average exchange rate of ~ 71 cents.

At 74 cents U.S. net capex would drop to ~ $75m, (note this does not account for the net sales proceeds of the remaining 767's in early 2017).

[Snow Leopard]

If you are going to add the spares into the depreciation then need to add spares capex onto the $2.1B spend. Want to split the difference on the net value and call it $220M?

We both need to add the $420M progress payments already made back because they are not the progress payments included in the future capex figures.

Stronger NZD good for buying planes and fuel, let us hope it lasts.

Do not know the precise details for airframe hours and cycles for AIR 767s but ballpark for that age appears to be about US$10M buying price.

Best Wishes
Paper Tiger

[oldtech]

NZX currently has the price at $2.060 - will this be the opening price, or is it likely to change some more before opening?

[workingdad]

you get what you pay for.....

http://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=11705647

[blackcap]

NZX currently has the price at $2.060 - will this be the opening price, or is it likely to change some more before opening?

That would probably be the theoretical ex div price based on last nights close. I do not think this is a trade as such and the market will determine this morning where the pricing action goes.

[oldtech]

Thanks blackcap, will wait and see what happens. Expecting a bit of turbulence ...

[Beagle]

If you are going to add the spares into the depreciation then need to add spares capex onto the $2.1B spend. Want to split the difference on the net value and call it $220M?

We both need to add the $420M progress payments already made back because they are not the progress payments included in the future capex figures.

Stronger NZD good for buying planes and fuel, let us hope it lasts.

Do not know the precise details for airframe hours and cycles for AIR 767s but ballpark for that age appears to be about US$10M buying price.

Best Wishes
Paper Tiger

Seeing as the company hasn't flagged any obvious additional capex apart from the planes maybe a holistic approach towards deducting total company depreciation isn't entirely inappropriate ?

Regarding the $420 deposit already made, if its anything like building a boat they want progress payments as the build progresses so I would speculate a large part of that deposit is progress payments on the 3 dreamliners they're getting imminently.

I started looking closely at capex and gearing post this dividend payment to examine the companies ability to be able to continue to pay 20 cents in dividends across the cycle. I am comfortable from a balance sheet perspective in terms of gearing and capex they can do this. Profitability is a separate matter and while its notoriously variable in the airline industry based on the mid point of this years forecast ($500m) in a year in which the competition is very intense I see EPS of 32 cps. ($500 x .72 / 1123m shares)

Thanks for your thoughts on average 767 sale price.

I'd like to think we can find common ground that net capex for the next three years of the fleet replacement cycle is inconsequential in the context of a company with turnover exceeding $5 billion per annum and after FY19 in the words of the CFO Rob McDonald, "we're looking at years of tremendous free cash flow"

Winner mate you raise a good point the other day about the $150m bonds @ 6.9% being due for repayment in November 2016. I'd expect they'd offer up a new term of 6-7 years at around 4-4.5% saving ~ $4m per annum in interest.

Another point, we know the little 19 seat planes have ceased operations and C.L. said they were costing the company ~ $1m a month.

I like the way that management is continually looking for cost savings and efficiencies. We haven't really talked much about how efficient the airline will be from FY19 onwards with one of the most modern fuel efficient fleets in the world at only 6.2 years average age. To coin one of Percy's favourite sayings, it appears we're well positioned :)

[winner69]

It looks like my hope of buying a couple of thousand more tomorrow at $1.92 have gone out the window.



....but buying this morning at 205-210 will still be great opportunity to enrich oneself

[winner69]

I always have a little smile when I see number next to 'Finance Income' in the Income Statement

Generally around $50m to $60m a year (last year was $53m)

Pretty good return for 'investing' all the zillions of dollars of pre-paid fares eh (assuming that thiscwhat it relates to)

Covers half their own interest bill

[bonmaklad]

Hey All,

I have been trying to post for the past week but today I have that magic email saying I am allowed to. It has been good fun reading all your comments.

My predict was for 2.46 end yesterday and a 2.11 start to todays trading.

I was in at 2.1 a few months ago and will be happy to leave in the mid 20s whenever that time comes (but I don't think it will be many days). My reasoning is mostly fundamental (more domestic flights which is where the main money is) but also technical (moving av). Most importantly at a 20c divi... 2.4 is a price that will sit nicely for mums and dads

[see weed]

Hey All,

I have been trying to post for the past week but today I have that magic email saying I am allowed to. It has been good fun reading all your comments.

My predict was for 2.46 end yesterday and a 2.11 start to todays trading.

I was in at 2.1 a few months ago and will be happy to leave in the mid 20s whenever that time comes (but I don't think it will be many days). My reasoning is mostly fundamental (more domestic flights which is where the main money is) but also technical (moving av). Most importantly at a 20c divi... 2.4 is a price that will sit nicely for mums and dads
Welcome aboard bonmaklad I have just put in a cheeky bid for 1.50 just for a laugh:D. But will have to up it as day progresses.

[bonmaklad]

Welcome aboard bonmaklad I have just put in a cheeky bid for 1.50 just for a laugh:D. But will have to up it as day progresses.

haha, if it goes below 2... I am doubling down... if it went below 1.7... I am pulling money out of the house :eek2:

[winner69]

From all accounts AIR IT and marketing are top notch.

Some research shows that 85% of travel consumers said they value personalisation ....and that personalisation affected their travel purchase decisions.

Digital technology is a powerful weapon these days in generating personalised offers to travellers to give hem stuff they 'value' and maintain loyalties etc. best of all these travellers don't seem to mind paying a premium.

Competition and cheap fares will always be here but the likes of AIR will make heaps out of life time value they can extract from a loyal customer (with personalised offers)

Maybe AIR already has a tablet in the crews quarter with the 'personal details' of the passengers to facilitate a more personalised service to each individual. Imagine a nice hostess approaching Seat 57C and saying 'hi Mr Roger - good flight. Did you know there!s a cute video on beagles on the entertainment system ......and heck these seats on the Dreamliners are pretty wide compared to sone of the sardine cans you get on other airlines (they both laugh as Roger trues to make himself a little more comfortable in 57C without spilling into 57B)'

That sort of service might go to economy but the notes on the tablet might say 'we need to get that MR Roger to spend his divies and fly Business so we nice to him at least and offer him an extra Pinot at least'

But that's the way the world is heading - sure AIR will be leading the way ....better returns than $800 trips to China

[swillisam]

I think if the share price goes below $2.00 today it won't stay there for long. Too many people would jump in if that mental hurdle is breached.

[Raz]

From all accounts AIR IT and marketing are top notch.

Some research shows that 85% of travel consumers said they value personalisation ....and that personalisation affected their travel purchase decisions.

Digital technology is a powerful weapon these days in generating personalised offers to travellers to give hem stuff they 'value' and maintain loyalties etc. best of all these travellers don't seem to mind paying a premium.

Competition and cheap fares will always be here but the likes of AIR will make heaps out of life time value they can extract from a loyal customer (with personalised offers)

Maybe AIR already has a tablet in the crews quarter with the 'personal details' of the passengers to facilitate a more personalised service to each individual. Imagine a nice hostess approaching Seat 57C and saying 'hi Mr Roger - good flight. Did you know there!s a cute video on beagles on the entertainment system ......and heck these seats on the Dreamliners are pretty wide compared to sone of the sardine cans you get on other airlines (they both laugh as Roger trues to make himself a little more comfortable in 57C without spilling into 57B)'

That sort of service might go to economy but the notes on the tablet might say 'we need to get that MR Roger to spend his divies and fly Business so we nice to him at least and offer him an extra Pinot at least'

But that's the way the world is heading - sure AIR will be leading the way ....better returns than $800 trips to China

I agree, they are getting better at this however there is room for improvement...as a high frequent flyer and my spend would be similar between AIR and Emirates as a whole pa Emirates are more progressive in this area currently.

[Beagle]

LOL mate you nailed it in one. Just as well Mrs Roger can accommodate some of her seat being "borrowed" :)

New head of digital from America looks to have the credentials to implement some interesting innovations. the other day they were talking about the future where AIR might have a virtual reality app where people can tap into a see the highlights of their forthcoming destination...imagine a heads-up on jet boating, bungy jumping, skiing, gondola ride, Earnslaw trip etc that would play on virtual reality like you were engrossed in the experience, that would pique peoples interest and get their tails wagging.

BTW What on earth happened to the U.S. Carriers on Wall Street ? UAL, AAL and Delta all up 4-5% overnight. Very supportive environment for AIR's first day trading ex.

[vin]

Going to be very interesting day today... Wonder if it'll breach $2

[Balance]

Going to be very interesting day today... Wonder if it'll breach $2

Ex 35 cents dividend so Air NZ sp has done very well since its results was announced and the doomsday merchants came out in droves to predict gloom and dark days for shareholders.

Analysts mid point valuation is $2.26 which will still give a dividend yield of between 8% to 10% in the next 3 years. Contrast that with overseas stocks and the likelihood that NZ interest rates go lower (especially with strong NZ$), and Air should recover towards that price.

[Beagle]

I think if the share price goes below $2.00 today it won't stay there for long. Too many people would jump in if that mental hurdle is breached.

Some kind soul took out my cheeky bid at $2.00. Very happy to invest more at that price and get a sustainable gross dividend yield of 27.78 / 200 = 13.89%

[Jantar]

I thought I was cheeky with an opening bid of $2.05. Got them at 2.045. Your $2.00 is much better.

[RupertBear]

Some kind soul took out my cheeky bid at $2.00. Very happy to invest more at that price and get a sustainable gross dividend yield of 27.78 / 200 = 13.89%

This little fish managed to nibble some at $2.00 as well :D

[Beagle]

I basically reinvested my special dividend this morning...and have decided to reinvest the rest into AIR as well...with AIR travel :cool:

[babymonster]

i just have time to put my order (2.00) in.. hopefully it will get filled.

[see weed]

2.02 here and more if it goes lower.

[WingingIt]

There is clearly some solid cost cutting going at, benefitting shareholders but ruining it for passengers. They consistently trumpet that some website has named them Airline of the year three years running and my last 10 international flights have been with Air Nz but i will look elsewhere next time. They market themselves rather well with this premium image but they are barely above Jetstar

Have just been return to Niue in The Works. Food or Drink (free alcohol in The Works) was not available to order for the whole three hour flight on the way over off the entertainment screen. You could only get things when the cart came down the aisle. Halfway through the flight I enquired when it would open and was told shortly. Cost cutting or incompetent staff?

On the return flight they ran out of meals 9 short from the end, so the snack items like Sandwiches and Pies ended up being used for those passengers. I had ordered and paid for a toasted sandwich but this never eventuated before showing up as sold out, you think someone could come explain why? I was only able to get one drink on the trolleys single trip down the aisle and then another when the Food and Drinks was available for ordering for single block of 30 minutes before being shut 1 hour from Auckland.

This is in complete contrast from a Works flight to Sydney last year where Food and Drink were available to order almost immediately and for most of the flight. Either the staff couldn't be bothered or Air Nz has some magical new reasons for this.

[peat]

The market was fairly efficient with the re-pricing ex-div tho ? Down 38c on a divvy of 35c so has opened -3 cetabis parabis.
From my understanding this would preclude dividend stripping.

[winner69]

The market was fairly efficient with the re-pricing ex-div tho ? Down 38c on a divvy of 35c so has opened -3 cetabis parabis.
From my understanding this would preclude dividend stripping.

Dividend strippers would have been buying pre announcement - when price averaged about 220

I reckon (real) dividend strippers have done quite well out of this,even if they sell today

This stripper doesn't feel like he's been molested and doesn't expect an apology from the NZRFU (or other team members)

[Raz]

For me a twenty cent play

[bonmaklad]

I thought I purchased at an average of 2.05 but I ended up with 2.1. Hence its tempting now to buy more

[Arbroath]

The market was fairly efficient with the re-pricing ex-div tho ? Down 38c on a divvy of 35c so has opened -3 cetabis parabis.
From my understanding this would preclude dividend stripping.

I'm not making any comment on whether a dividend stripping strategy will work here with AIR but usually it requires buying 2-4 weeks before dividend and holding for a few weeks after so if you bought at say $2.25 you've now received the 35c dividend and if the price gets anywhere near $2.25 in the next few weeks you're a winner (this time). The debate of course is that there are a whole range of factors affecting the price apart from the dividend itself over a period of 4-5 weeks but over my investing life (c. 3o years) it happens more often than not - look at Contact in the past 10 days - went ex 15cps and recovered it within a week. People will argue all day long about efficient markets etc but that looks a text book dividend strip to me....

[Bobdn]

Contact recovered in 48 hours

[sb9]

Hv only got one parcel of medium size at 204.5 and that's it, didn't add any more or sold any of that yet and no immediate plans of selling....

[thestg]

Contact recovered in 48 hours

Over the last 4 dividends paid by AIR the average recovery time to the pre-dividend price has been 37.5 days (Close prices used). After an average of 14 days the close price was at its lowest.
Pre Div $2.90 - Ex $2.84 - 5 days later $2.75 - 13 days later $2.90
Pre Div $2.53 - Ex $2.41 - 1 days later $2.35 - 28 days later $2.58
Pre Div $2.97 - Ex $2.88 - 16 days later $2.67 - 37 days later $2.97
Pre Div $2.21 - Ex $2.06 - 34 days later $1.79 - 72 days later $2.23

[Beagle]

Over the last 4 dividends paid by AIR the average recovery time to the pre-dividend price has been 37.5 days (Close prices used). After an average of 14 days the close price was at its lowest.
Pre Div $2.90 - Ex $2.84 - 5 days later $2.75 - 13 days later $2.90
Pre Div $2.53 - Ex $2.41 - 1 days later $2.35 - 28 days later $2.58
Pre Div $2.97 - Ex $2.88 - 16 days later $2.67 - 32 days later $2.97
Pre Div $2.21 - Ex $2.06 - 34 days later $1.79 - 72 days later $2.23

Nice analysis work. That last example where it got down to $1.79 was at the time of great fear of a world-wide Ebola pandemic so one can probably eliminate that from the study as it was a highly unusual event.

[sharp]

There is clearly some solid cost cutting going at, benefitting shareholders but ruining it for passengers. They consistently trumpet that some website has named them Airline of the year three years running and my last 10 international flights have been with Air Nz but i will look elsewhere next time. They market themselves rather well with this premium image but they are barely above Jetstar

Have just been return to Niue in The Works. Food or Drink (free alcohol in The Works) was not available to order for the whole three hour flight on the way over off the entertainment screen. You could only get things when the cart came down the aisle. Halfway through the flight I enquired when it would open and was told shortly. Cost cutting or incompetent staff?

On the return flight they ran out of meals 9 short from the end, so the snack items like Sandwiches and Pies ended up being used for those passengers. I had ordered and paid for a toasted sandwich but this never eventuated before showing up as sold out, you think someone could come explain why? I was only able to get one drink on the trolleys single trip down the aisle and then another when the Food and Drinks was available for ordering for single block of 30 minutes before being shut 1 hour from Auckland.

This is in complete contrast from a Works flight to Sydney last year where Food and Drink were available to order almost immediately and for most of the flight. Either the staff couldn't be bothered or Air Nz has some magical new reasons for this.

Have you raised this with Air NZ?

Did you voice your complaints and issues to the stewardards/esses on the plane?

What were their reactions and attitudes?

When was the last time you flew Jetstar? Have you flown with any other airlines recently?

[allfromacell]

Selling out just before record date or immediately after ex date usually results in sub par short term performance all other factors being equal according to dividend stripping studies I have seen.

Generally those buying ahead of a dividend and holding for several weeks after ex, on average make short term outperformance gains.

Anyway for all fellow dividend hounds the beagle has crunched the numbers for you, (remember the 5% RWT comes off the dividend grossed up for imputation credits so for every share you own assuming you don't have an exemption certificate for RWT you'll get

35 cps / 0.72 = gross dividend 48.6111 cps
Imputation Credits @ 28% 13.6111 cps
Resident Withholding tax at 5% 2.4305 cps
Net Dividend 32.5695 cps

Anyone on a lower tax rate than 33%, (under $70K per annum) will be able to claim back a portion of the RWT and / or Imputation credit when they do their FY17 tax return.

e.g. A taxpayer on a marginal tax rate of 17.5%, (up to $48K per annum) would get a refund per share of (48.6111 x 17.5% = 8.5069 tax - tax deducted 16.04cps) = 7.5331 cps so their net dividend after calculating their tax refund would come to 32.5695 + 7.5331 = 40.1 cps. People on under $48,000 per annum must love N.Z.'s imputation system as they get 5 cents in extra dividend due to the tax credits, how good is that !

Thanks for the post Roger, as a young person on less than 48K I would never have known this otherwise. It seems there is a significant tax incentive for me to invest in shares paying regular imputed dividends. So all I need to do is submit the imputation credits and dividend amount at the end of the year on my personal tax summary?

[see weed]

Over the last 4 dividends paid by AIR the average recovery time to the pre-dividend price has been 37.5 days (Close prices used). After an average of 14 days the close price was at its lowest.
Pre Div $2.90 - Ex $2.84 - 5 days later $2.75 - 13 days later $2.90
Pre Div $2.53 - Ex $2.41 - 1 days later $2.35 - 28 days later $2.58
Pre Div $2.97 - Ex $2.88 - 16 days later $2.67 - 37 days later $2.97
Pre Div $2.21 - Ex $2.06 - 34 days later $1.79 - 72 days later $2.23
That would be after normal div. So if you deduct the 25c special from closing price of 2.41c, then $2.16c will be the recovery price. My recovery price is $2.134c at the moment. So am not too worried at this stage, especially when on the ASB securities AIR detail page saying the cps is 45c and the yld is 21% odd for unsuspecting new comers to the site:).

[Beagle]

Thanks for the post Roger, as a young person on less than 48K I would never have known this otherwise. It seems there is a significant tax incentive for me to invest in shares paying regular imputed dividends. So all I need to do is submit the imputation credits and dividend amount at the end of the year on my personal tax summary?

You're welcome mate. I enjoy contributing for the benefit of others and yes you are right anyone on under $48K, marginal tax rate 17.5% can get quite a nice benefit from investing in shares paying full imputation credits at 28%. Just a note of caution though. The IRD gives you a tax credit for all your imputation credits but will not refund imputation credits per se. People need to have some other form of tax credit, RWT deducted, tax paid or PAYE credits which are refundable for the imputation credit to be effectively utilised in the year in which its received otherwise the imputation credit carries forward to future years. Yes just fill out the dividend section of your tax return with all the information contained in your dividend statements and Bob's your Uncle :)

[Balance]

Some kind soul took out my cheeky bid at $2.00. Very happy to invest more at that price and get a sustainable gross dividend yield of 27.78 / 200 = 13.89%

Already up 3.5% tax free - so equivalent to leaving in the bank for 2 years to get that kind of return for those risk adverse!

[winner69]

Arbroath ......I'm not making any comment on whether a dividend stripping strategy will work here with AIR but usually it requires buying 2-4 weeks before dividend and holding for a few weeks after...........

That's how I approach dividend stripping - when i play this game i buy about 2 weeks before the announcement and sell about 2 weeks after ex div.

This time around real bonanza with AIR. - 35 cent divie and maybe not even a cap loss (12 cebts at moment)

Back testing

Sept 14 - divie 15.5 and share down 2 = BRILLIANT
Mar 15 - divie 6.5 share up 14 = MORE THAN BRILLIANT
Sep 15 - divie 9.5 share down 20 = BIT SAD
Mar 16 - divie 10 share down 1 = PRETTY GOOD
Sep 16 - way its heading = AWESOME

as pointed out by somebody last week good things don't continue for ever so next March?

[QOH]

Roger can you or some other maths genius please tell me what amount will go into my bank account on 10000 AIR shares and my tax rate is 17.5%. I want to mentally spend it today.

[777]

Roger can you or some other maths genius please tell me what amount will go into my bank account on 10000 AIR shares and my tax rate is 17.5%. I want to mentally spend it today.

The same as everyone else...

10000*.35/.72*.67=3,256.95.

Gross dividend will be 4,861.11
Imputation credit 1,361.11
Tax withheld 243.05

Net paid 3,256.95

File it in your tax return next year and your final tax will be 850.69(4861.11*.175). Refund will be 1361.11+243.05-850.69=753.47.

As Roger has mentioned you need to be paying enough tax to get all your imputation credit but if not then you can carry it forward to future years.

[winner69]

?....... Bob's your Uncle :)

No no mate - with AIR its 'Rob's your Uncle' :)

[QOH]

The same as everyone else...

10000*.35/.72*.67=3,256.95.

Gross dividend will be 4,861.11
Imputation credit 1,361.11
Tax withheld 243.05

Net paid 3,256.95

File it in your tax return next year and your final tax will be 850.69(4861.11*.175). Refund will be 1361.11+243.05-850.69=753.47.

As Roger has mentioned you need to be paying enough tax to get all your imputation credit but if not then you can carry it forward to future years.
Thanks very much.

[Beagle]

Isn't life grand. People on a 17.5% tax rate can milk the extra 10.5% tax credit the company has imputed through the dividend imputation system with fully imputed dividends at 28%. The IRD used to have a saying, "its our job to be fair", they don't use that punchline any more but in this particular instance I think its more than appropriate, enjoy :)

What's that American airline index thingy again that some of you guys follow and how much was it up on Wall Street yesterday ?

Who wants the pleasure of working out Couta1's forthcoming dividend on 370,000 shares ?

[workingdad]

Seems a lot of debate on AIR. Should we do a poll on SP ex divvy.

I think SP with be 2.35 to 2.40 prior and drop to 2.05 to 2.10 range ex.

Let me know if there's interest and I will start one

Not too far off on the estimate (29th Aug) - nice change after having a few over the last 6 months with AIR not quite being on par.....

[777]

Isn't life grand. People on a 17.5% tax rate can milk the extra 10.5% tax credit the company has imputed through the dividend imputation system with fully imputed dividends at 28%. The IRD used to have a saying, "its our job to be fair", they don't use that punchline any more but in this particular instance I think its more than appropriate, enjoy :)

What's that American airline index thingy again that some of you guys follow and how much was it up on Wall Street yesterday ?

Who wants the pleasure of working out Couta1's forthcoming dividend on 370,000 shares ?

=37*3256.95=120,507.15.


Or about 57,797 more AIR shares

[Beagle]

=37*3256.95=120,507.15.


Or about 57,797 more AIR shares

LOL yes that reminds me where's my e.mail from Couta1 this morning....there it is "added 51K more shares at $2.01 average, now holding 420K shares at $1.94 average price ex divvy. Well positioned and "gonads" have grown even bigger. At $2.08 last time I looked I make our friend as being in the green by a whopping $58,800 ! Who said averaging down doesn't work !! Couldn't happen to a nicer guy !

My reply is unprintable on this forum but something along the lines of how do you walk or ski with @#$lls that big ? Guess he takes the be strong and courageous stuff in the Bible literally !

He reckons it'll be back in the 220's in no time...I'm starting to think he might be a guru prophet.

[RupertBear]

LOL yes that reminds me where's my e.mail from Couta1 this morning....there it is "added 51K more shares at $2.01 average, now holding 420K shares at $1.94 average price ex divvy. Well positioned and "gonads" have grown even bigger. At $2.08 last time I looked I make our friend as being in the green by a whopping $58,800 ! Who said averaging down doesn't work !! Couldn't happen to a nicer guy !

Awesome! Good on ya Couta :t_up:

[Gizzajob I can do that]

LOL yes that reminds me where's my e.mail from Couta1 this morning....there it is "added 51K more shares at $2.01 average, now holding 420K shares at $1.94 average price ex divvy. Well positioned and "gonads" have grown even bigger. At $2.08 last time I looked I make our friend as being in the green by a whopping $58,800 ! Who said averaging down doesn't work !! Couldn't happen to a nicer guy !

My reply is unprintable on this forum but something along the lines of how do you walk or ski with @#$lls that big ? Guess he takes the be strong and courageous stuff in the Bible literally !

He reckons it'll be back in the 220's in no time...I'm starting to think he might be a guru prophet.

I guess he wont be milking the extra 10.5% tax credit:D

[winner69]

Awesome! Good on ya Couta :t_up:

Is my mate couts stuck on the mountain without internet access or something?

[heisenberg]

Puts my 1000 shares to absolute shame... Gotta start somewhere though right??

[stoploss]

Puts my 1000 shares to absolute shame... Gotta start somewhere though right??
Investing is a long game , Rome wasn't built in a day .

[Beagle]

I guess he wont be milking the extra 10.5% tax credit:D

That could be difficult :D


Is my mate couts stuck on the mountain without internet access or something?

No the poor bugger has been banned till 12 September :( he's off for 9 days skiing on 11th so realistically the earliest he might be back is 20th if we are fortunate enough to see him back at all.

[winner69]

Checking arrivals at WLG

Singapore Airlines and its Apital Connection arrives in 13 days it says

[Raz]

LOL yes that reminds me where's my e.mail from Couta1 this morning....there it is "added 51K more shares at $2.01 average, now holding 420K shares at $1.94 average price ex divvy. Well positioned and "gonads" have grown even bigger. At $2.08 last time I looked I make our friend as being in the green by a whopping $58,800 ! Who said averaging down doesn't work !! Couldn't happen to a nicer guy !

My reply is unprintable on this forum but something along the lines of how do you walk or ski with @#$lls that big ? Guess he takes the be strong and courageous stuff in the Bible literally !

He reckons it'll be back in the 220's in no time...I'm starting to think he might be a guru prophet.]

Good for Couta1 although when I looked at that I was surprised his average price ex divvy is down to $1.94, he must have bough a large parcel/s of late to get his average share price down from last time he mentioned it. Mine is down to 1.88. I've taken a punt on the other high yield stock Rodger keeps going on about... we will see...

[mshierlaw]

Watched today with interest. I was surprised when pre open all bids & asks including previous trades were BLANK. Havn't seen that mid week before, is this normal or is this an extrordinary situation?

[Snow Leopard]

Watched today with interest. I was surprised when pre open all bids & asks including previous trades were BLANK. Havn't seen that mid week before, is this normal or is this an extrordinary situation?

Happens for every share when it goes ex-div.

Specials to London Heathrow with Malaysia Airlines for $1249 (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11706110)

Let me know if you take it up - I will wave at your plane as it goes by.

Best Wishes
Paper Tiger

[babymonster]

I only have 4K shares and it's my biggest holding in my portfolio

[RupertBear]

Puts my 1000 shares to absolute shame... Gotta start somewhere though right??

Dont be ashamed of having 1000 shares. I am a newbie too, started with 1,000 and have nibbled my way up to 10,000 in the last week or two :D. That is the limit for this little fish at the moment. I have the greatest respect for the amount of shares the big boys hold, but that would scare the **** out of me :scared:

[kiora]

Happens for every share when it goes ex-div.

Specials to London Heathrow with Malaysia Airlines for $1249 (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11706110)

Let me know if you take it up - I will wave at your plane as it goes by.

Best Wishes
Paper Tiger

Ouch
https://www.youtube.com/watch?v=gDwCMxPwJ_4&list=RDgDwCMxPwJ_4#t=73

[tim23]

From my understanding after xd date all bids are cleared for new days trading.

[Subway]

Happens for every share when it goes ex-div.

Specials to London Heathrow with Malaysia Airlines for $1249 (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11706110)

I have a one hour stopover in KL each way too so its a quick way to get home!Let me know if you take it up - I will wave at your plane as it goes by.

Best Wishes
Paper Tiger

Have booked this for a visit home to NZL in Feb, i'd like to pledge allegiance to Air NZ, but when you are booking the cheap bucket Economy fares on Air NZ the SP and AP earn rates are terrible and not enough of an incentive to book with them.

[Snow Leopard]

I have taken the liberity of reconstructing what I believe you meant to say. you can PM me if it needs changing:

Have booked this for a visit home to NZL in Feb, i'd like to pledge allegiance to Air NZ, but when you are booking the cheap bucket Economy fares on Air NZ the SP and AP earn rates are terrible and not enough of an incentive to book with them. I have a one hour stopover in KL each way too so its a quick way to get home!

Pricing is getting really aggressive at the moment with East Asian & Middle-Eastern carriers apparently determined to fill their planes.

Though Malaysia Airlines offers a good inflight service I like to avoid Heathrow and usually pick the cheapest deal from KL to Birmingham on my annual pilgrimage to Blighty.

Airline loyality schemes are hardly worth it these days and I only sign up for them so they can auto-populate the forms when I book a flight.

Best Wishes
Paper Tiger

[Raz]

It's the time of year to plan our annual boys trip to the UK to take in a couple of EPL games and drink and well drink....always look at the cheap flights as affordability is a big issue for most although nearly all are aware of the safety records of airlines..so it just doesn't just come down to price.

[iceman]

Have booked this for a visit home to NZL in Feb, i'd like to pledge allegiance to Air NZ, but when you are booking the cheap bucket Economy fares on Air NZ the SP and AP earn rates are terrible and not enough of an incentive to book with them.

I see a few comments on here recently about service and costs. I have just returned from a trip with Star Alliance, Air NZ to Houston, Lufthansa to Frankfurt and then Buenos Aires, AIR from BA-Auckland. Business class fares all of it. On the last leg with AIR from BA to AKL, I wanted to change my dates and fly 4 days earlier than originally booked. AIR told me as they had only 2 seats left, they would need to charge an extra $1,880 on the already hugely expensive tickets. I said "stuff you" I will fly PE instead. Their reply, sorry your fare rules don't allow you "voluntary downgrade" so if you want to travel in a lower class, you need to buy a new ticket.
As I could not change dates, we ended up paying the ridiculous amount to get 1 of the 2 remaining BC seats to sit amongst the Pumas :-) BUT what infuriates me, is that one BC seat was empty. Pathetic service from AIR where loyalty (Gold Elite) makes no difference. Loyalty is a 2 way thing as far as I am concerned and AIR just lost mine

[Beagle]

I can't help wondering if Malaysian airlines still fly over the Ukraine and whether they're properly psychologically testing their pilots now as part of their annual medical.
I'd still much rather pay ~ $1900 and fly with AIR and Singapore.

[Raz]

I see a few comments on here recently about service and costs. I have just returned from a trip with Star Alliance, Air NZ to Houston, Lufthansa to Frankfurt and then Buenos Aires, AIR from BA-Auckland. Business class fares all of it. On the last leg with AIR from BA to AKL, I wanted to change my dates and fly 4 days earlier than originally booked. AIR told me as they had only 2 seats left, they would need to charge an extra $1,880 on the already hugely expensive tickets. I said "stuff you" I will fly PE instead. Their reply, sorry your fare rules don't allow you "voluntary downgrade" so if you want to travel in a lower class, you need to buy a new ticket.
As I could not change dates, we ended up paying the ridiculous amount to get 1 of the 2 remaining BC seats to sit amongst the Pumas :-) BUT what infuriates me, is that one BC seat was empty. Pathetic service from AIR where loyalty (Gold Elite) makes no difference. Loyalty is a 2 way thing as far as I am concerned and AIR just lost mine

I hear you, been there before:-) AIR do not have the structure in place to deal with this stuff unless you are a member of the elite priority one club or VIP, I have only found it with Emirates, with them I have a relationship manager that caters for a group of higher net worth private business owners. Emirates can also accommodate it on its routes as it has the volume seats capacity to provide the flexibility.

[iceman]

I can't help wondering if Malaysian airlines still fly over the Ukraine and whether they're properly psychologically testing their pilots now as part of their annual medical.
I'd still much rather pay ~ $1900 and fly with AIR and Singapore.

They could give the pilots a blowup doll to have in the COCKpit :-)

[Sideshow Bob]

They could give the pilots a blowup doll to have in the COCKpit :-)

Jeepers, it's only Friday morning, not Friday night!

[iceman]

Jeepers, it's only Friday morning, not Friday night!

That's what they do at AIR so thought it was a good idea for Friday morning :-)

[Beagle]

They could give the pilots a blowup doll to have in the COCKpit :-)

LOL mate. There's always at least one rotten apple in even some of the best barrels. Put you complaint in writing to AIR and see if they can resolve it for you.

[Arbroath]

I see a few comments on here recently about service and costs. I have just returned from a trip with Star Alliance, Air NZ to Houston, Lufthansa to Frankfurt and then Buenos Aires, AIR from BA-Auckland. Business class fares all of it. On the last leg with AIR from BA to AKL, I wanted to change my dates and fly 4 days earlier than originally booked. AIR told me as they had only 2 seats left, they would need to charge an extra $1,880 on the already hugely expensive tickets. I said "stuff you" I will fly PE instead. Their reply, sorry your fare rules don't allow you "voluntary downgrade" so if you want to travel in a lower class, you need to buy a new ticket.
As I could not change dates, we ended up paying the ridiculous amount to get 1 of the 2 remaining BC seats to sit amongst the Pumas :-) BUT what infuriates me, is that one BC seat was empty. Pathetic service from AIR where loyalty (Gold Elite) makes no difference. Loyalty is a 2 way thing as far as I am concerned and AIR just lost mine

That is very disappointing Iceman and an experience like that would taint things for me too. At the front line of customer service the most important thing to get right is a common sense approach to situations and they should've been able to sort you out given the no doubt $25-35k that round trip had cost your company. For the sake of $2k they've p1ssed off a customer who would keep spending a lot more if kept happy etc.

[workingdad]

I see a few comments on here recently about service and costs. I have just returned from a trip with Star Alliance, Air NZ to Houston, Lufthansa to Frankfurt and then Buenos Aires, AIR from BA-Auckland. Business class fares all of it. On the last leg with AIR from BA to AKL, I wanted to change my dates and fly 4 days earlier than originally booked. AIR told me as they had only 2 seats left, they would need to charge an extra $1,880 on the already hugely expensive tickets. I said "stuff you" I will fly PE instead. Their reply, sorry your fare rules don't allow you "voluntary downgrade" so if you want to travel in a lower class, you need to buy a new ticket.
As I could not change dates, we ended up paying the ridiculous amount to get 1 of the 2 remaining BC seats to sit amongst the Pumas :-) BUT what infuriates me, is that one BC seat was empty. Pathetic service from AIR where loyalty (Gold Elite) makes no difference. Loyalty is a 2 way thing as far as I am concerned and AIR just lost mine

Yep, I don't disagree, I have also found their inability to be flexible is frustrating and for gold members that have proved their worth there needs to be more than just an automated answering phone saying they recognise the number calling from and being a premium customer and extend it into the following conversation. As you say Iceman, its a two way street and I will continue to fly AIR as the koru lounge network within nz is something I enjoy but hopefully recognising the need to retain frequent business class customers is something they can address.

[dobby41]

Things have certainly changed.
There was a time in the not too distant past where the tiers really meant something.
I remember flying cattle and a hostess coming up with a paper because I was gold.
You felt special.
Seems not it's worth nothing.

[Mickey]

I see a few comments on here recently about service and costs. I have just returned from a trip with Star Alliance, Air NZ to Houston, Lufthansa to Frankfurt and then Buenos Aires, AIR from BA-Auckland. Business class fares all of it. On the last leg with AIR from BA to AKL, I wanted to change my dates and fly 4 days earlier than originally booked. AIR told me as they had only 2 seats left, they would need to charge an extra $1,880 on the already hugely expensive tickets. I said "stuff you" I will fly PE instead. Their reply, sorry your fare rules don't allow you "voluntary downgrade" so if you want to travel in a lower class, you need to buy a new ticket.
As I could not change dates, we ended up paying the ridiculous amount to get 1 of the 2 remaining BC seats to sit amongst the Pumas :-) BUT what infuriates me, is that one BC seat was empty. Pathetic service from AIR where loyalty (Gold Elite) makes no difference. Loyalty is a 2 way thing as far as I am concerned and AIR just lost mine

Please complain to the CEO Iceman. I don't work for AIR but I do work for a large NZ Corporate and I know that the only way you can effect change in some cases is by bringing these types of situations to the attention of the CEO. Churn in high value spend customers is something they will not want.

[hamish]

That is very disappointing Iceman and an experience like that would taint things for me too. At the front line of customer service the most important thing to get right is a common sense approach to situations and they should've been able to sort you out given the no doubt $25-35k that round trip had cost your company. For the sake of $2k they've p1ssed off a customer who would keep spending a lot more if kept happy etc.

It's not just AiR NZ specific unfortunately. Try the sam with Jetstar, Qantas, Emirates, AirAsia, Singapore etc. It's an industry thing = revenue protection by being formal/rigid around the classification of tickets and not allowing changes beyond the conditions. Airline customer support staff are trained to stick to these rules and not change them

[Raz]

It's not just AiR NZ specific unfortunately. Try the sam with Jetstar, Qantas, Emirates, AirAsia, Singapore etc. It's an industry thing = revenue protection by being formal/rigid around the classification of tickets and not allowing changes beyond the conditions. Airline customer support staff are trained to stick to these rules and not change them

I agree...

When I complained with AIR, yes they did provide some compensation for that one time as I was very frequent traveller, although no provision going forward. Emirates do offer a personalised service for a tier below the VIPs for frequent flyers which works for me when off to EU or Asia however not USA. I'm not aware of any other airline like you say and what i get with Emirates would not even be available for the infrequent business class traveller even ...

[BlackPeter]

It's not just AiR NZ specific unfortunately. Try the sam with Jetstar, Qantas, Emirates, AirAsia, Singapore etc. It's an industry thing = revenue protection by being formal/rigid around the classification of tickets and not allowing changes beyond the conditions. Airline customer support staff are trained to stick to these rules and not change them

Well, yes ... but some airlines might have some more customer friendly conditions. I remember a situation some years ago when our son (having booked a flight with Emirates to Europe) missed the flight because of a confusion of dates (clearly his fault) ... he was basically a "no-show" for them. I fully expected the ticket to be void, but he called them nearly a week after he missed the flight, and they happily reinstated his ticket at a date he asked for. I think he had to pay a $300 or so "administration fee".

Now this is customer service (and this for economy class).

[simjp81]

Is it me, or is it still too early to tell, but the recovery in SP looks like it will be a slow flight up to cruising altitude.

[bonmaklad]

I am a little shocked there is so many people selling below 2.10...

[Leftfield]

It's not just AiR NZ specific unfortunately. Try the sam with Jetstar, Qantas, Emirates, AirAsia, Singapore etc. It's an industry thing = revenue protection by being formal/rigid around the classification of tickets and not allowing changes beyond the conditions. Airline customer support staff are trained to stick to these rules and not change them

In fairness to AIR, I recently returned from a European trip traveling AIR & Lufthansa. On return to NZ, I had to check in for my return flight from AUK to Wngtn. A helpful AIR staff member noted the 3 hour wait ahead of me with my scheduled flight and said how about we try and get you on an earlier flight. This was done for me and within about 1 hour I was on an alternative flight - at no extra cost. I considered it a v nice gesture and the episode made me v happy to be returning home with AIR.
( In another case I am aware of, AIR found an earlier flight for a family of 3 returning from the USA to Wngtn, saving them an hour on their journey, at no cost. A nice gesture.)

[Raz]

In fairness to AIR, I recently returned from a European trip traveling AIR & Lufthansa. On return to NZ, I had to check in for my return flight from AUK to Wngtn. A helpful AIR staff member noted the 3 hour wait ahead of me with my scheduled flight and said how about we try and get you on an earlier flight. This was done for me and within about 1 hour I was on an alternative flight - at no extra cost. I considered it a v nice gesture and the episode made me v happy to be returning home with AIR.
( In another case I am aware of, AIR found an earlier flight for a family of 3 returning from the USA to Wngtn, saving them an hour on their journey, at no cost. A nice gesture.)

Yes this happens often with domestic flights, international as I said earlier to be fair to them they often have limited capacity to be flexible...

[simjp81]

I am a little shocked there is so many people selling below 2.10...

You and me both. Anyone else. Who still expects a recovery to the 220's in a few weeks?

[Raz]

In time yes, it's not even two days yet:)

[winner69]

I am a little shocked there is so many people selling below 2.10...

Maybe saw that NTA per share as at June was only $1.76

[Snow Leopard]

Maybe saw that NTA per share as at June was only $1.76

less $0.35 for that dividend payout and add maybe $0.06 in profits since.

So only $1.47 now.

Best Wishes
Paper Tiger

[Raz]

Yeah let's head to liquidation values:)

[clips]

not so long ago i got tangled up with a couple of AIR air hostess.. (another story..) they where always told if the plane is over weight, passengers are the first thing to be bumped off, the money is in the freight

[Xerof]

that usually applies to standby passengers only clips, but anyway, tell us about your entanglement - sounds like a much better story :eek2:

[777]

not so long ago i got tangled up with a couple of AIR air hostess.. (another story..) they where always told if the plane is over weight, passengers are the first thing to be bumped off, the money is in the freight

Blonde I bet. Total bs.

[Jantar]

You and me both. Anyone else. Who still expects a recovery to the 220's in a few weeks?
I suspect that many are waiting to actually have the dividend in their bank before buying more AIR.

[Beagle]

less $0.35 for that dividend payout and add maybe $0.06 in profits since.

So only $1.47 now.

Best Wishes
Paper Tiger

Quite right but NTA doesn't seem to be especially relevant to other airlines, closest competitor QAN has an NTA of ~ $1.50, almost the same as AIR and SP over $3.30 last time I looked. Proof that AIR is worth at least $3.00 :D

EPS of 32 cps based on mid point of forecast and forecast divvies of 20 cps is what matters.

[biker]

Here's a theory for the ardent AIR holders.
Why not switch to VAH? They have a recapitalised balance sheet ( ok, still not fantastic), some 'interesting' shareholders, such a low share price and resilient major shareholders that the downside from these levels ( early to mid 20c) IMO is limited, and similar 'airline' (too many moving parts) risks to AIR.
Also, while QAN are fierce opposition, I would argue VAH don't face the same widespread growing competition that AIR is facing.
Finally, while AIR is mostly out of VAH because they "had better things to do with the money" (i.e. give it to shareholders, and who knows where that pressure came from) it doesn't mean VAH doesn't have a profitable future given time.
OK, no dividends for a long time, but the share price could well compensate for that.

Disc. Bought AIR at 87c when they were well out of favour, and did quite well.
Holding VAH for the turnaround.

[Arbroath]

Here's a theory for the ardent AIR holders.
Why not switch to VAH? They have a recapitalised balance sheet ( ok, still not fantastic), some 'interesting' shareholders, such a low share price and resilient major shareholders that the downside from these levels ( early to mid 20c) IMO is limited, and similar 'airline' risks to AIR.
Also, while QAN are fierce opposition, I would argue VAH don't face the same widespread growing competition that AIR is facing.
Finally, while AIR is mostly out of VAH because they "had better things to do with the money" (i.e. give it to shareholders, and who knows where that pressure came from) it doesn't mean VAH doesn't have a profitable future given time.
OK, no dividends for a long time, but the share price could well compensate.

Disc. Bought AIR at 87c when they were well out of favour, and did quite well.
Holding VAH for the turnaround.

Biker

Respect for looking at things from a different angle but I don't share your perpestive. AIR have a very strong domestic franchise which flys around 85% of passenger movements in NZ and that remains very profitable despite Jetstar being on the scene. International is clearly much tougher looking forward and AIR might only break even on that shortly. But VAH still have a poor balance sheet and struggle to make a return even with low oil prices. Glad AIR kicked VAH for touch. It might seem cheap but to me is a value trap. Most large holders are strategic holders rather than return on investment from VAHs operations imho.

[Beagle]

They're as different as chalk and cheese for all the reasons that have already been discussed many times at great length.

[simjp81]

$2.035 bargain.

[biker]

Biker

Respect for looking at things from a different angle but I don't share your perpestive. AIR have a very strong domestic franchise which flys around 85% of passenger movements in NZ and that remains very profitable despite Jetstar being on the scene. International is clearly much tougher looking forward and AIR might only break even on that shortly. But VAH still have a poor balance sheet and struggle to make a return even with low oil prices. Glad AIR kicked VAH for touch. It might seem cheap but to me is a value trap. Most large holders are strategic holders rather than return on investment from VAHs operations imho.

And, you may well be right.

[biker]

They're as different as chalk and cheese for all the reasons that have already been discussed many times at great length.

Yes, quite right Roger, and that was the point of my post.

[Beagle]

Its literally on a wing and a prayer Biker. Balance sheet is still badly stretched, old panes mostly leased, lack of cohesive business plan, no idea when or if the company will make money.

Bottom line for me if Chris Luxon wanted out so badly and was best placed to know the systemic issues facing the company with a seat on the board, I'm staying well away. There are many issues including lacklustre management and the cream Branson pulls out of the operation with royalties. In fact the only ones doing well are Branson and management, shareholders are sheep that get shorn.
Besides that Beagles don't like eating chalk :)

P.S. Almost forgot. AIR are looking to sell their remaining shares in VAH "in due course" so an overhang of 200 million odd shares is something else for investors in VAH to keep in mind.

[skid]

$2.035 bargain.

Thats pretty much where it should be, deducting the Dividend---You didnt really think you were getting a totally ''free lunch'' did you?-(Actually I think SH have come out a bit in the black)---Meanwhile..get ready for the competition--(yes,I mean domestic as well,where price really does make a difference)
We are now entering the golden era of the airline Customer (as opposed to airline accountants) Its now up to the airline economic strategists and marketing Gurus.(Lets hope they make a few changes in your area,Iceman and Dobby)
Its time for Chris to earn his stripes----Will he be able to hold onto his ''messiah status''?-We shall see --This has got to be good for ''Joe Public''

[skid]

It's not just AiR NZ specific unfortunately. Try the sam with Jetstar, Qantas, Emirates, AirAsia, Singapore etc. It's an industry thing = revenue protection by being formal/rigid around the classification of tickets and not allowing changes beyond the conditions. Airline customer support staff are trained to stick to these rules and not change them

So while other airlines are also adopting stupid policies,this would be a good time to show some economic sense( Revenue protection, in this case, does not apply to future revenue)..Many victims,in the future, will vote with their patronage.
This may sound like a criticism,but it is also an opportunity,there for the taking.

[skid]

Ah Oh! Looks like there may be a new game in town ,outside the AIR bubble..(Airline index down 2.69% with the Dow.S&P,Nasdaq, on its heels) Flash in the pan?

[winner69]

Qantas cheapest stock in the world - from Barrons and republished in The Australian

Has 50% upside and all that stuff

Aussie insto move out of AIR into this wonder stock?

http://www.barrons.com/articles/qantas-is-dirt-cheap-and-can-fly-50-higher-1473303710

Air NZ standing in the world is highlighted - its not even mentioned ha ha

[blockhead]

Flight just coming in to AKL with a flat tyre, be a few puckering ring pieces on board I imagine

[winner69]

Flight just coming in to AKL with a flat tyre, be a few puckering ring pieces on board I imagine

All safe and sound

Probably a Dreamliner - always seem to be them having problems these days

Must stop watching Air Crash Investigation

Bit horrifying what happens these days - one I saw recently had these pilots both done 10,000 plus flying hours and never never landed a plane by hand (without the computer helping out)

[Beagle]

All safe and sound

Probably a Dreamliner - always seem to be them having problems these days

Must stop watching Air Crash Investigation

Bit horrifying what happens these days - one I saw recently had these pilots both done 10,000 plus flying hours and never never landed a plane by hand (without the computer helping out)

http://www.msn.com/en-nz/news/national/plane-with-flat-tyre-lands-safely/ar-AAiIXNI?li=BBv6TfA&ocid=spartandhp

Automatic landing systems are fitted on all modern commercial airliners. At least with AIR's pilots you know they've been trained the old fashioned way and come up through one of the best accredited flying schools with hundreds of hours hands on flying in a Cessna or similar light aircraft types. Many of the new low cost airlines predominantly use simulators these days.

As for Qantas being bargain cheap how would they know as the company declined to issue a forecast for FY17 ? but noted competition and revenue pressure. I think they're in much the same situation as AIR and their FY17 earnings will get a haircut much like AIR's and wouldn't be surprised to see their EPS much the same as AIR's is in FY17 as was the case in FY16...yet their shares at ~ $3.30. Which shares are really the bargain ?

[winner69]

Roger - i think was a Korean plane I mentioned - the computers or something broke and the pilots didn't know how to land and it crashed

[RupertBear]

Was thinking of holding onto my (big for me but small for most people) shares until they went up to what I paid for them (whenever that may be) but I am now worried that what is happening overseas will cause the share price to fall even further. I am thinking it might be wise to sell off some at a loss but in anticipation of buying them back when the sp goes down. Hmm what are peoples thoughts on the current situation please. Many thanks

[Beagle]

Watch out you don't get churned Rupert Bear. U.S. market could easily bounce back on Monday. The airline index was up about 4% on Wednesday in the U.S. (Thursday our time) and AIR didn't react positively to the more substantial index rise then so why should we react negatively to a smaller decrease just because it corrected a bit on Friday ? Well run airline on compelling fundamental's, substantially better value than QAN. P.S. I remember the old days I felt proud owning 500 AIR shares..Rome wasn't built in a day :)

[RupertBear]

Watch out you don't get churned Rupert Bear. U.S. market could easily bounce back on Monday. The airline index was up about 4% on Wednesday in the U.S. (Thursday our time) and AIR didn't react positively to the more substantial index rise then so why should we react negatively to a smaller decrease just because it corrected a bit on Friday ? Well run airline on compelling fundamental's, substantially better value than QAN. P.S. I remember the old days I felt proud owning 500 AIR shares..Rome wasn't built in a day :)

Thanks Roger, think I will continue to hold. I might just not look at the sp for a day or two and let my nerves settle :D

[winner69]

Watch out you don't get churned Rupert Bear. U.S. market could easily bounce back on Monday. The airline index was up about 4% on Wednesday in the U.S. (Thursday our time) and AIR didn't react positively to the more substantial index rise then so why should we react negatively to a smaller decrease just because it corrected a bit on Friday ? Well run airline on compelling fundamental's, substantially better value than QAN. P.S. I remember the old days I felt proud owning 500 AIR shares..Rome wasn't built in a day :)

Good advice - but if Rupert convinced there going to be a global crash he should sell all the stocks he owns and avoid the grief

So 500 shares once - probably when they were $14 odd

[workingdad]

its how the big fish make money, sell off quickly at a hint of bad news, cause everyone else to sell, buy back in a day or three later and laugh at the millions of money and 2% they just made...... Without things like brexit ect how would they make their money???

[Snow Leopard]

...As for Qantas being bargain cheap how would they know as the company declined to issue a forecast for FY17 ? but noted competition and revenue pressure. I think they're in much the same situation as AIR and their FY17 earnings will get a haircut much like AIR's and wouldn't be surprised to see their EPS much the same as AIR's is in FY17 as was the case in FY16...yet their shares at ~ $3.30. Which shares are really the bargain ?

Because even without a forecast any one who can do airline analysis can make a set of assumptions and come up with a value for that airline.

So for AIR the set of circumstances that results in a consensus value of $2.24 gives a valuation for QAN of $4.35.

So Qantas IS the bargain, it is that simple.

Best Wishes
Paper Tiger

[tim23]

Relax buy more if price goes down the reasons for you buying should remain in tact.

[Snow Leopard]

Figures are 2016 ballpark:

AIR revenue per share: $4.63 [ $5,200M / 1,123M ]

QAN revenue per share: $8.31 [ $16,200M / 1950M ]

QAN:AIR rps ratio 1.79:1

Now assume that QAN can in future achieve similar margins to AIR (and there are no reasons why they can not)...

DYOR

Best Wishes
Paper Tiger

Disc: no QAN, no AIR

[fish]

Figures are 2016 ballpark:

AIR revenue per share: $4.63 [ $5,200M / 1,123M ]

QAN revenue per share: $8.31 [ $16,200M / 1950M ]

QAN:AIR rps ratio 1.79:1

Now assume that QAN can in future achieve similar margins to AIR (and there are no reasons why they can not)...

DYOR

Best Wishes
Paper Tiger

Disc: no QAN, no AIR

Thank you so much for this PT.
Revenue is what is most important if costs can be reduced and margins increased.
It will however be difficult for many reasons for QAN to achieve similar margins-and if possible will this not take years?
I worry about you posting at this time
Where in the world are you and what time is it?
best
Fish

[Jantar]

Yes. it was Korean, Asiana Airlines Flight 214. A Boeing 777-200 ER. We were talking about it our local flying club shortly after the event, and even our student pilots present had more take-offs and landings than both 777 pilots combined. Despite their combined flying time of over 20,000 hours their actual hands on flying experience was severely lacking. One pilot had some hands on as a military pilot, the other had almost none at all. Neither had ever done a visual approach in a 777.

[winner69]

Yes. it was Korean, Asiana Airlines Flight 214. A Boeing 777-200 ER. We were talking about it our local flying club shortly after the event, and even our student pilots present had more take-offs and landings than both 777 pilots combined. Despite their combined flying time of over 20,000 hours their actual hands on flying experience was severely lacking. One pilot had some hands on as a military pilot, the other had almost none at all. Neither had ever done a visual approach in a 777.

Thanks

We put a heap of faith in these pilots, or is it computers, dont we

[Jantar]

Thanks

We put a heap of faith in these pilots, or is it computers, dont we
One of the reasons I choose not to fly with airlines that use only simulator to PTF training.

My son is a pilot for Qantas Link on a Boeing 717. Before he even went to the Aviation College at Ardmore I had sent him solo in gliders, and progressed him to single seaters, flying in the Southern alps, with only minimal navigation aids. He needed over 1000 hours to get even a basic Commercial flying job in Australia, and almost 6,000 hours hands on flying, before any Australian or New Zealand airline would even consider him. In many asian airlines it is possible that one of the pilots up front has less than 500 hours, and most of that in a simulator.

[Snow Leopard]

Thank you so much for this PT.
Revenue is what is most important if costs can be reduced and margins increased.
It will however be difficult for many reasons for QAN to achieve similar margins-and if possible will this not take years?
I worry about you posting at this time
Where in the world are you and what time is it?
best
Fish

Top to bottom:
You are welcome.

To shareholders is it not sustainable profit that is most important, and how the company achieves it is secondary (assuming they do so ethically)?

Current analyst group think is that FY17 AIR has better margins and FY18 & FY19 QAN wins that contest.

[However I still act on my bias that airlines in general are not a good investment but it is your call with your money.]

Worry not for me.
Currently home in Malaysia where the clock is 4 hours behind the one on your wall. Grounded until my new NZ passport arrives and I get the necessary visas fitted.


Best Wishes
Paper Tiger

[Raz]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11707664

Government sector contracts would be substantial domestic market share to retain or lose..

[winner69]

Don't know, but higher the close the better for all shareolders. Sold down 15000 at 2.40 to get av pr down to 2.147, not selling any more today.

When you guys do your averages do you include dividends

Just curious

[Jantar]

When you guys do your averages do you include dividends

Just curious
I do. Simply because the dividend is immediately reinvested in more shares.

[Beagle]

QAN running substantially higher leverage than AIR and still flying old gas guzzling 747's. A strategy that works when oil is cheap and travel demand is high....at other times ????...well lets just say many of us remember a $2billion plus loss not that long ago. Assumptions require a significant body of accumulated evidence to validate same. Analysts have been saying for a long time now QAN is worth a lot more than AIR and yet they keep hitting very similar EPS numbers. Assumptions valid or requiring an awful lot more further verification...you folks be the judge.

Apart from their incredible fuel efficiency this is one of the reasons why AIR are so keen on the Dreamliner and why I would chose one or an A380 which is pressurised at 5,000 ft over an older tech aircraft...you arrive in much better shape. http://www.msn.com/en-nz/money/technology/boeing-is-making-a-major-change-to-its-planes-that-could-end-jet-lag-as-we-know-it/ar-AAiLUHv?li=AA4Zjm&ocid=spartandhp

[BlackPeter]

Looks like there is a wee analyst re-rating going on:

2017 revenue estimate down to $5196m (from $5531m)
2017 EPS estimate down to 33.7 cts per share (from 47.8 cents / share)
Predicting further EPS drops in 2018 and 2019 (but then - who knows?)

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

12 month consensus now down to $2.20 ($2.10 to $2.35) and recommendation "Hold".

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

Given that analysts are typically optimistic and slow in changing their (recently quite upbeat) estimates ... maybe a good idea to wait until this cyclical stock comes closer to the bottom.

Discl: not holding; DYOR;

[see weed]

When you guys do your averages do you include dividends

Just curious
No, have never added divs to my av prices. Dividends are the icing on the cake.

[Gringo]

I don't mind SP staying at these low levels for another week or so... more bang-4-bucks with dividend reinvestment<img title="Smile_2" id="vB_Editor_001_smilie_17" alt=":)" src="http://www.sharetrader.co.nz/images/smilies/001_smile.gif" border="0">&nbsp;Even better if&nbsp;AIR kept the DRP.

[BlackPeter]

Ouch - dropped like a stone through the 200 mark. Time for couta to back up the truck?

Kids, don't try that at home ...

[bull....]

Ouch - dropped like a stone through the 200 mark. Time for couta to back up the truck?

Kids, don't try that at home ...

or breakout the wiskey

[workingdad]

investing has different approaches from different people or even a multifaceted approach. AIR for me is what can I get some money I don't need to access for some years do for me while it is parked up, shares go up, shares go down, cyclical or not, selling on a low is not smart investing neither is buying on a high. So many companies out there are overpriced and more risk of a downside than others. Looking through the cycle of AIR and the projected dividends on offer for the foreseeable future I cant think of too many in the same range, is it a risk and what is that risk? SP dropping short to medium term - yes, long term will it always be low - not likely as at some stage the cycle will return.

I plan on buying more, have been thinking about it for a while now but waiting for a bottom range to be more obvious. Happy to hold what I have which is a third of what I had at the highest point and take some divvies in the interim. Hedged my bets a bit but in saying that, I think AIR is a good place to park some money in the longer term and have that money work for me making reasonably good income off them throughout.

[winner69]

Quote workingdad - .....I think AIR is a good place to park some money in the longer term .....

Workingdad - with all due respect i would contend that a stock like AIR is the WORST place to park your money.

Just my view - each to their own I guess

[Beagle]

Analysts have a very poor track record of guessing any further out than the company gives them visibility...i.e. companies own track record of forecasting is at least as good as analysts. They're confident the company can pay 20 cps fully imputed across the cycle which equates to a gross dividend yield of 14.17% at $1.96. Present company management and directors are well respected and I wouldn't be surprised to see Chris Luxon win CEO of the year award at this year's Deloitte Top 200 company awards. Risks, sure as those with a negative view are so keen to remind us at every SP down-draft opportunity, (but keep strangely silent when the SP goes up ?), but 14% is a very robust return for those looking long term. The Government have done very well investing across the cycle, maybe shareholders can too.

[Gringo]

If as Roger suggests AIR can maintain 20c DPS for the next 5 years thru the cycle, AIR makes a compelling long-term investment to me IF you reinvest all dividends.
For example, if one bought 7,500 shares @ 2.00 for $15,000 - after 5 years total value would be $24,158. # shares 12,079 (4,579 more); $9,158 dividends paid. Annualized return of 10%.
Numbers might be a bit off (depends on online div calculator used), but principle sound I think.
Assumes no SP appreciation, no dividend DPS change, no special div, no tax
THE POWER OR COMPOUND INTEREST...

[workingdad]

Workingdad - with all due respect i would contend that a stock like AIR is the WORST place to park your money.

Just my view - each to their own I guess

Are you saying that AIRs SP will always be under pressure and the cyclical nature will never result in another period of 2.50 + in the next cycle? I am not trying to be argumentative, just curious to understand why you have that view. If I buy more shares at the bottom of the cycle and sit back on greater than 10% returns for a few years or more I would have thought this was a reasonable return.

I played trader for a while in the last few years and averaged 17% returns but still have thoughts the market is well overpriced and prefer to change my strategy which doesn't involve spending time watching it waiting for the next BREXIT or FED rate rise......

[fish]

Thanks roger
Your post helped me to buy more at 196
Risky stock but room for some in my portfolio with heaps of dividends awaiting I like to get in first before others start buying-they have to put their money somewhere and I cant see many stocks with this sort of dividend-even better than the GEN,CEN and NZO I hold.
I do like dividends and the advice I get on this forum is balanced-you have to put it on your own scales rather than accepting what brokers advise

[Yoda]

Ouch - dropped like a stone through the 200 mark. Time for couta to back up the truck?

Kids, don't try that at home ...
It seems almost every thing has dropped today. Is there something globally going on ? not many greens on my board.

[777]

It seems almost every thing has dropped today. Is there something globally going on ? not many greens on my board.

Suggest you monitor the world indices.

http://www.bloomberg.com/markets/stocks

[Jantar]

It seems almost every thing has dropped today. Is there something globally going on ? not many greens on my board.
Market overall is down 1.9% today, but I can't see any obvious cause. Maybe just an overall correction to the rapid rise that has occurred recently.

[Yoda]

Suggest you monitor the world indices.

http://www.bloomberg.com/markets/stocks
mmmm.... cheers

[heisenberg]

No complaints at all... red days are great days for buying

[winner69]

Are you saying that AIRs SP will always be under pressure and the cyclical nature will never result in another period of 2.50 + in the next cycle? I am not trying to be argumentative, just curious to understand why you have that view. If I buy more shares at the bottom of the cycle and sit back on greater than 10% returns for a few years or more I would have thought this was a reasonable return.

I played trader for a while in the last few years and averaged 17% returns but still have thoughts the market is well overpriced and prefer to change my strategy which doesn't involve spending time watching it waiting for the next BREXIT or FED rate rise......

All that may (possibly) eventuate but that's punting / trading IMO

'Parking your money' in a stock to me is putting it into 'safer' / 'less risky' / 'non cyclical' / 'less volatile' stocks than what AIR is

However you have obviously made a well thought considered decision so hope it works out well. Each to their own but i wouldn't be 'parking' my money in AIR - i be watching like a hawk



Where is AIR in the cycle now? Maybe on the down leg - how would you feel in say 6 months time when (possibly) AIR is $1.40 approaching the bottom of this cycle?

[workingdad]

All that may (possibly) eventuate but that's punting / trading IMO

'Parking your money' in a stock to me is putting it into 'safer' / 'less risky' / 'non cyclical' / 'less volatile' stocks than what AIR is

However you have obviously made a well thought considered decision so hope it works out well. Each to their own but i wouldn't be 'parking' my money in AIR - i be watching like a hawk



Where is AIR in the cycle now? Maybe on the down leg - how would you feel in say 6 months time when (possibly) AIR is $1.40 approaching the bottom of this cycle?

Yep, its all taking a punt and going with what seems right at the time. There are certainly less risky and less volatile stocks but they also are all overpriced with PEs less desirable and if the house of cards falls there's some SPs out there with a fairly decent correction coming.

My anticipation is it wont get to 1.40, I don't even consider 1.60 a high likelihood but far too many variables to make such judgements. Long term with fleet age and the direction management are taking AIR I feel its a company worth parking some money in for a while. With the 35c divvy I am even at todays range in the green and thinking people looking for a return similar to me will be considering AIRs attractive divvy yield and SP a contender.

Thanks for that, I too hope it works out well.

[bull....]

if you don't have to sell it provides a good div yield at the moment and could be part of a diversified portfolio

[Beagle]

All that may (possibly) eventuate but that's punting / trading IMO

'Parking your money' in a stock to me is putting it into 'safer' / 'less risky' / 'non cyclical' / 'less volatile' stocks than what AIR is

However you have obviously made a well thought considered decision so hope it works out well. Each to their own but i wouldn't be 'parking' my money in AIR - i be watching like a hawk



Where is AIR in the cycle now? Maybe on the down leg - how would you feel in say 6 months time when (possibly) AIR is $1.40 approaching the bottom of this cycle?

Hi Mate, I presume you have sold ?

Extremely unlikely in my opinion. Remember as we get toward the bottom of the cycle one can anticipate a dramatic PE expansion, (PE is presently about half its 10 year average). Even if earnings halved from here in future years, (going down to $250m before tax from mid point of current year company forecast $500m before tax for FY17), which I would hasten to add that no broker is forecasting it will get remotely that bad, even out to FY19, AIR's PE at today's price would simply revert to its 10 year average thus we would then have the stock trading at its 10 year average PE at such a deep trough to its earnings logic would suggest it would be very close to the cyclical low.

Logic therefore suggests that we will probably see PE expansion, not price contraction from here if earnings decline somewhat in FY18. I don't think analysts can reliably predict FY18 earnings this far out so their estimates and assumptions should be viewed in the context of how badly wrong they got them for FY17 until the company recently updated them.
On the remote chance we got down to $1.40 I would see that as a very special opportunity...one that only comes along once every few years and make an investment decision accordingly.

[winner69]

Hi Mate, I presume you have sold ?

Extremely unlikely in my opinion. Remember as we get toward the bottom of the cycle one can anticipate a dramatic PE expansion, (PE is presently about half its 10 year average). Even if earnings halved from here in future years, (going down to $250m before tax from mid point of current year company forecast $500m before tax for FY17), which I would hasten to add that no broker is forecasting it will get remotely that bad, even out to FY19, AIR's PE at today's price would simply revert to its 10 year average thus we would then have the stock trading at its 10 year average PE at such a deep trough to its earnings logic would suggest it would be very close to the cyclical low.

Logic therefore suggests that we will probably see PE expansion, not price contraction from here if earnings decline somewhat in FY18. I don't think analysts can reliably predict FY18 earnings this far out so their estimates and assumptions should be viewed in the context of how badly wrong they got them for FY17 until the company recently updated them.
On the remote chance we got down to $1.40 I would see that as a very special opportunity...one that only comes along once every few years and make an investment decision accordingly.

Those comments I made were about 'parking your money' in AIR not being a good idea. Now workingdad agrees that it's 'taking a punt' rather then safely 'parking' ones hard earned we are now both on the same page

Haven't sold yet - hoping that 196 in the bottom. Still about 10 cents to the good but dividend stripping hasn't worked as well as much as it was meant to - it wasn't really manna from heaven after all

That AIR cyclical chart still bugs me

[skid]

Are you saying that AIRs SP will always be under pressure and the cyclical nature will never result in another period of 2.50 + in the next cycle? I am not trying to be argumentative, just curious to understand why you have that view. If I buy more shares at the bottom of the cycle and sit back on greater than 10% returns for a few years or more I would have thought this was a reasonable return.

I played trader for a while in the last few years and averaged 17% returns but still have thoughts the market is well overpriced and prefer to change my strategy which doesn't involve spending time watching it waiting for the next BREXIT or FED rate rise......

That is a reasonable return WD--I think the debate is whether this is the bottom of the cycle or if there is still a ways to go--In this environment ,projected earnings can be missed--We just have to wait and see how ticket sales go in this new playing field.

In terms of dividends--They are only a return(17%) if that amount does not come off the share price after. Otherwise they are just paying you part of their value-(as WD pointed out he is still in the black though)-what happens in the future is any ones guess.

[Beagle]

"Fare" enough mate. On the divvy stripping thing...usually takes a few weeks and remember some of it happens prior to going ex, this time I'm thinking about twice that long due to its size. Market as a whole is down 2.6% today so no surprise to see AIR as a high beta stock down a bit more.

[skid]

"Fare" enough mate. On the divvy stripping thing...usually takes a few weeks and remember some of it happens prior to going ex, this time I'm thinking about twice that long due to its size. Market as a whole is down 2.6% today so no surprise to see AIR as a high beta stock down a bit more.

Absolutely right--The market is definitely a big factor today,no getting around that--That always has to be factored in---its one thing that I find spooky about the ''buy and hold' strategy--The odds of the big one,however remote,have to be considered.---The pre market numbers are not looking as bad as before --still down though----of course Janet could fix all that,for now

[Snow Leopard]

Looks like there is a wee analyst re-rating going on:

2017 revenue estimate down to $5196m (from $5531m)
2017 EPS estimate down to 33.7 cts per share (from 47.8 cents / share)
Predicting further EPS drops in 2018 and 2019 (but then - who knows?)

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

12 month consensus now down to $2.20 ($2.10 to $2.35) and recommendation "Hold".

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

Given that analysts are typically optimistic and slow in changing their (recently quite upbeat) estimates ... maybe a good idea to wait until this cyclical stock comes closer to the bottom.

Discl: not holding; DYOR;

Published figures show that globally RPK growth is now under-performing the long term average (short term now 4.5%).

US/Europe/Asia (x China/India) full service are sub 2.5% and even the Low Cost guys have seen growth declines (to 12% :) ).

More importantly ASK growth is running higher than RPK growth at about 7%.

This is currently manifesting itself as a large number of airlines offering really good deals.

So the analysts are currently more likely to be cutting rather than raising their carefully considered valuations.

Best Wishes
Paper Tiger

[simjp81]

Those comments I made were about 'parking your money' in AIR not being a good idea. Now workingdad agrees that it's 'taking a punt' rather then safely 'parking' ones hard earned we are now both on the same page

Haven't sold yet - hoping that 196 in the bottom. Still about 10 cents to the good but dividend stripping hasn't worked as well as much as it was meant to - it wasn't really manna from heaven after all

That AIR cyclical chart still bugs me

Im with ya winner69. Dividend stripping has not been successful so far. Sigh

[thestg]

Im with ya winner69. Dividend stripping has not been successful so far. Sigh

It depends on how you do it. I bought 9221 shares the week before going XD for $2.27 & sold the day AIR went XD for $2.06.
Gross Return $2,439 = 11.62% (Cash return from div $960.00 & $1,479 to come from the tax man at tax time.) Also have to pay $30.00 on my loan interest which I paid back today. Also I have another 12,000 shares to sell (Which I also bought for $2.27 the week before XD) in about a month when the price settles. Hope it gets back to pre-XD price by then.

[777]

It depends on how you do it. I bought 9221 shares the week before going XD for $2.27 & sold the day AIR went XD for $2.06.
Gross Return $2,439 = 11.62% (Cash return from div $960.00 & $1,479 to come from the tax man at tax time.) Also have to pay $30.00 on my loan interest which I paid back today. Also I have another 12,000 shares to sell (Which I also bought for $2.27 the week before XD) in about a month when the price settles. Hope it gets back to pre-XD price by then.


Interesting. How do you get the total Imputation credit and RWT refunded by the IRD? If your income is low enough to get the RWT back then that is easy but if that low then you won't get all the imputation credits this year.


Disregard. I figured it out. Well done. You will be claiming the capital loss against your dividend because of your intention to trade as against invest .

Tongue in cheek smilie here>

[thestg]

Had to split the investment & buy most of this one on my wife's account. I think by the end of the tax year she will end up with carry overs.

[brend]

why does the chart look like this? odd buys and sells

Buyers



Buy Quantity
Prices


2

24,544
$2.015


1
7,500
$1.965


1
50,000
$1.950


1
2,000
$1.935


4
63,000
$1.930


2
10,000
$1.920


6
25,670
$1.910


3
16,000
$1.905


13
116,930
$1.900


1
10,000
$1.880


34
325,644





Prices
Sell Quantity
Sellers


$1.795

5,000
1


$1.845
9,107
1


$1.865
10,116
1


$1.900
30,200
2


$1.925
10,000
1


$1.935
38,463
2


$1.940
218,535
3


$1.950
19,302
1


$1.960
4,247
1


$1.965
7,100
1



352,070
14

[winner69]

Roger, I hear what you are saying about AIR doing to PE expansion and reverting to its long term average of 10.

However I point out that generally when AIR has an PE >10 is when profits are down the gurgler - like 2010/2012 period as per numbers below (from Morningstar)

Interesting their is a pretty strong correlation between AIR's EPS and the relativity of AIR's PE to the market (discount) - that correlation being >60%

In other words (historically) the more money AIR makes the more AIR's PE is 'discounted' by the market (and vice versa). Even the current 'discount' of 75% (AIR's PE relative to market's PE) isn't an outlier in the scheme of things

You are correct that as AIR's earnings fall the PE will probably increase - but unless they wipe out completely I would say that a reasonable PE will settle at between 6 and 8 (based on history) - a lot also depends on how well the NZX does or doesn't as well

We probably saying the same thing - you with some rnthusiasm but I am a bit more tempered in my expectations.

Main factor is that AIR is a real cyclical and to make matters worse a NZ cyclical so has that additional 'discount' to Aussie and global airlines. It really is a beast that defies logic

[winner69]

Jeez a close at 193.5 .... and the low for the day

Won't want another bad day tomorrow will we?

[workingdad]

Gee, look at that market PE...... good table thanks Winner

[777]

why does the chart look like this? odd buys and sells

Buyers



Buy Quantity
Prices


2

24,544
$2.015


1
7,500
$1.965


1
50,000
$1.950


1
2,000
$1.935


4
63,000
$1.930


2
10,000
$1.920


6
25,670
$1.910


3
16,000
$1.905


13
116,930
$1.900


1
10,000
$1.880


34
325,644





Prices
Sell Quantity
Sellers


$1.795

5,000
1


$1.845
9,107
1


$1.865
10,116
1


$1.900
30,200
2


$1.925
10,000
1


$1.935
38,463
2


$1.940
218,535
3


$1.950
19,302
1


$1.960
4,247
1


$1.965
7,100
1



352,070
14




All normal with every stock at opening and 1645 to 1700 everyday.

[workingdad]

75,000 shares traded after market at 1.96.... wonder what open will be in am.... US market might have a bounce as the big boys make their usual gains

[777]

75,000 shares traded after market at 1.96.... wonder what open will be in am.... US market might have a bounce as the big boys make their usual gains

Done at the weighted average for the day so the trade does not indicate much.

[skid]

75,000 shares traded after market at 1.96.... wonder what open will be in am.... US market might have a bounce as the big boys make their usual gains

So far everything is down including futures ...but we live in hope

[Hoop]

Gee, look at that market PE...... good table thanks Winner

Have a closer look...guess when the PE was this low in the last cycle...Hint: look to your left

[Raz]

Im with ya winner69. Dividend stripping has not been successful so far. Sigh

Yes it all depends..mixed bag for sure, sold a third just before ex dividend on the run up, 23 cents per share gain, sold a third post dividend at 2.08 and still holding a third..will have to consider my stop loss over night as we may well be heading there shortly at this rate. See this as market sentiment only and still believe in AIR as an investment..just like an airplanes inertia..AIR price adopts similar characteristics at times.....on the flip side that usually means you have plenty of time to buy in again.

I maintain capital first and foremost and take the gains when they are on the table. Away on an intense trip to Boston on Sunday and if I can't keep an eye on this share I feel better being out of it:-)

[Beagle]

Roger, I hear what you are saying about AIR doing to PE expansion and reverting to its long term average of 10.

However I point out that generally when AIR has an PE >10 is when profits are down the gurgler - like 2010/2012 period as per numbers below (from Morningstar)

Interesting their is a pretty strong correlation between AIR's EPS and the relativity of AIR's PE to the market (discount) - that correlation being >60%

In other words (historically) the more money AIR makes the more AIR's PE is 'discounted' by the market (and vice versa). Even the current 'discount' of 75% (AIR's PE relative to market's PE) isn't an outlier in the scheme of things

You are correct that as AIR's earnings fall the PE will probably increase - but unless they wipe out completely I would say that a reasonable PE will settle at between 6 and 8 (based on history) - a lot also depends on how well the NZX does or doesn't as well

We probably saying the same thing - you with some rnthusiasm but I am a bit more tempered in my expectations.

Main factor is that AIR is a real cyclical and to make matters worse a NZ cyclical so has that additional 'discount' to Aussie and global airlines. It really is a beast that defies logic

Thanks for the chart mate. Serves to illustrate my point. Looking through the timeline of the last GFC In 2008 AIR traded at 43% of average market PE, 2009 49%, 2010 87.5% and 2011 107%. Notice the PE expansion at the bottom of the cycle ? Presently on a historical basis AIR trades at just 22.5% of the average market PE which is unprecedented at any stage prior to or during the last GFC. Even bringing this right up to speed based on mid point of analyst and company forecast $500m for FY17 that's 32 cps after tax so a forward FY17 PE of 6.04 based on a closing price of $1.93.5 This represents approx. just 30% of the NZX50 market average forward PE of ~20. Remember this forecast is based on a year which includes all known new competition and highly competitive yield conditions, (very cheap airfares) and we're at just 30% of market PE, again unprecedented at any time during the lead up too, or during the last GFC.

I think this is supportive of my contention that on a relative basis compared to a very stretched market, AIR is very cheap. That's not to say there's no downside risk if there's some sort of GFC MK2 but the effects thereof are somewhat mitigated by its relative valuation to the market being at such an unprecedented low level both on a historical and forward PE view.

Not sure if anyone else noticed but during the last GFC a lot of blue chip stocks got a really savage beating, even the real blue chips like Ryman weren't immune, in fact far from it.
In a world where bonds are extremely expensive, (very low yield) real estate is exorbitant, other NZX shares are trading on an average forward PE of ~20 its seems a reasonable proposition to me that risks and rewards for holding AIR shares are relatively balanced at around this level and also reasonable to say in the event of another GFC a LOT of other stocks are going to get a serious beating.

In terms of AIR's resilience to a downturn, another factor I have been thinking about today, it was noted that they remained profitable throughout the GFC, arguably the worst downturn since the great depression of 1929. They didn't post a $2billion+ loss like QAN did and while we're on the subject of competition over the ditch its really quite sad that Virgin can't even make any money in FY16 when we've enjoyed the most favourable conditions for airlines in arguably the last 50 years. How would they cope with another GFC ?

[allfromacell]

Jeez a close at 193.5 .... and the low for the day

Won't want another bad day tomorrow will we?


$1.93 is $2.28 cum dividend so the way I see it, it could still fall plenty. I'm hoping to top up at around $1.80.

[winner69]

.....
Presently on a historical basis AIR trades at just 22.5% of the average market PE which is unprecedented at any stage prior to or during the last GFC.

Correct -- but not an outlier with the pretty strong correlation (65%) between EPS and this market relativity. The more AIR makes the greater the difference to the market PE and vice versa.

Incidently follows the same traits - higher the profits the bigger discount to the market PE. QAN current PE of 5.3 and 31% of Aussie market PE (Morningstar numbers)

Below is same table as before with QAN's PE shown. QAN's PE has historically been higher than AIR's PE - see my comment earlier about the NZ country discount. Interesting eh. Whether right or wrong that's what happens and nothing likely to change here

Exactly what you are saying about AIR applies to QAN - echo's of that Barron's article about QAN being the cheapest stock in the world. If they had realised that AIR actually exists in this world they might have concluded the equal cheapest stock in the world (with AIR)

But AIR is very much a cyclical and behaves like one. Maybe 4 times 50 cents/share is about the same as 8 times 25 cents/share and that's where it will be in a few years time.

But in the meantime as Raz says no doubt plenty of trading opportunities but a bugger dividend stripping was a bit disappointing this time around - still 8 cents up but that's bugger all eh. Hope it's not less than 8 cents this time tomorrow as winner hates losing.

[Baa_Baa]

Can't blame todays price drop on AIR or it's fundamentals, as has been pointed out it probably has one of the best ROI's on the market, albeit subject to volatility and where one bought in. The divi strip was looking just fine on Friday, one shouldn't beat oneself's up just because Janet decides to forecast a US rate rise after our market closes. Probably quite a few intrepid 'investors' sucking the kumara right now, especially the early buyers after the highs and the 'average down' folks, I feel for them. Crap timing for a local market rout but that's the breaks. Spend the divi buying the lows whenever that happens, it'll make one feel a lot better, though some patience and fortitude might be required. Jmho.

[Fox]

I'm no TA expert, leaving that title to Hoop, but the $2 support/resistance line was broken which is historically significant. The current trend can be comparable to that during 2007 with similair highs/lows and volatility in trading as per the chart below (I'm not saying this is a repetition of the GFC). The death cross was observed in mid-May and the cum-div price bounced off the 200 day MA, establishing the downtrend channel.

TA is in no means a prediction of the future, merely a representation of investor behaviour that can reveal trading patterns to those who are willing it see it. The fundamentals may well be spectacular, which have been discussed at great lengths over the past few months, but buying at the wrong time in a cyclical stock's swings can be harmful.

DYOR and be careful.

http://puu.sh/r8xdf/6f0794d010.png

[winner69]

AIR share price back over 200 today - heading to 220 by month end

No worries

[workingdad]

Well the US markets have bounced so if AIR doesn't then we have a clearer understanding of mr market value on it.....

[Raz]

Well the US markets have bounced so if AIR doesn't then we have a clearer understanding of mr market value on it.....

One can hope...

If considering AA for your next flight AKL to LAX consider the inconvenience of a limited network when things don't go to plan. I heard one recent flight out of Auckland had an 18 hour wait due to a medical emergency that the pilot had when coming to Auckland thus had to wait for another pilot to come to NZ to take them to LAX. American staff at AKL were very helpful and provided food, a nice hotel room and shuttle to and from the airport for the night for those in involved however my contact needed to be in the USA.

[iceman]

One can hope...

If considering AA for your next flight AKL to LAX consider the inconvenience of a limited network when things don't go to plan. I heard one recent flight out of Auckland had an 18 hour wait due to a medical emergency that the pilot had when coming to Auckland thus had to wait for another pilot to come to NZ to take them to LAX. American staff at AKL were very helpful and provided food, a nice hotel room and shuttle to and from the airport for the night for those in involved however my contact needed to be in the USA.

A bit like me and 40 other AIR passengers going to Frankfurt via Houston recently. Late departure from AKL missed Lufthansa connection so we got 24 hours in Texas. Nice hotel and good transport but we needed to be in Europe and most had to sort/pay new ongoing travel arrangements from Frankfurt.

But on a different note, I hope AIR keeps dropping a bit more to enter my radar screen again :-)

[skid]

I would imagine most are expecting AIR to recover today.
That little episode however, goes to show how sensitive outside markets are these days.

[Beagle]

I'm no TA expert, leaving that title to Hoop, but the $2 support/resistance line was broken which is historically significant. The current trend can be comparable to that during 2007 with similair highs/lows and volatility in trading as per the chart below (I'm not saying this is a repetition of the GFC). The death cross was observed in mid-May and the cum-div price bounced off the 200 day MA, establishing the downtrend channel.

TA is in no means a prediction of the future, merely a representation of investor behaviour that can reveal trading patterns to those who are willing it see it. The fundamentals may well be spectacular, which have been discussed at great lengths over the past few months, but buying at the wrong time in a cyclical stock's swings can be harmful.

DYOR and be careful.

http://puu.sh/r8xdf/6f0794d010.png

AIR at $1.935 = 35 cent divvy = $2.285 so on a dividend adjusted basis if one takes that as a reasonable interpretation and I make no assertions either way, (just pointing out an alternative view), is still above the 100 day moving average.


A bit like me and 40 other AIR passengers going to Frankfurt via Houston recently. Late departure from AKL missed Lufthansa connection so we got 24 hours in Texas. Nice hotel and good transport but we needed to be in Europe and most had to sort/pay new ongoing travel arrangements from Frankfurt.

But on a different note, I hope AIR keeps dropping a bit more to enter my radar screen again :-)

All will be forgiven then I presume mate and you can start flying them again :D

Winner - Okay, yeap, I can see your point of view now. I guess the market is worried that there might be another downgrade sometime this year which would explain the very low PE relative to market.

[Beagle]

AIR is exiting the NZX15 on Friday 16th during close of trading in the match process. Does anyone have any thoughts they'd care to share on what possible impact on the share price due to this event, if any ?

[OldGuy]

already back to $2 in first 16 minutes of trading :)

[winner69]

already back to $2 in first 16 minutes of trading :)

One of the cheapest stocks in the world .....more to come

[Beagle]

One of the cheapest stocks in the world .....more to come

Yesterday it was going to be $1.40 in a year's time... LOL mate you're a character:p

[winner69]

Yesterday it was going to be $1.40 in a year's time... LOL mate you're a character:p

Well you never know with AIR eh

That chart that shows the long term cyclical nature of the AIR share price still worries me - 140 sometime still on cards, current environment not that good.

But then dividend strippers will see price back to 220 pretty soon.

Being cheap doesn't mean a good investment does it - cheap for a reason?

[sb9]

But then dividend strippers will see price back to 220 pretty soon.



Think they're all waiting for divvy monies to be paid on Monday and then we might see the surge in sp.

[winner69]

Think they're all waiting for divvy monies to be paid on Monday and then we might see the surge in sp.

...but wouldn't they be getting now before the big rush - cost more next week

[sb9]

...but wouldn't they be getting now before the big rush - cost more next week

But they went all in before it went ex-divvy, with FOMO on fat juicy divvy...

[Raz]

But they went all in before it went ex-divvy, with FOMO on fat juicy divvy...

Yup, winner forgets small investors are generally poor and do not have excess disposable income:-) He is forgetting all that super on tap!

[Jantar]

Yup, winner forgets small investors are generally poor and do not have excess disposable income:-).....
Well, maybe not quite poor, but certainly lacking in disposable income.

I was thrilled when my annual bonus from work came through last week and finally allowed my to break that elusive $100K mark on my portfolio. But that didn't leave much left over to take advantage of the fall in prices this week. Now next week I should be able to buy some more, so here's hoping prices stay lowish for another week.

[Raz]

Well, maybe not quite poor, but certainly lacking in disposable income.

I was thrilled when my annual bonus from work came through last week and finally allowed my to break that elusive $100K mark on my portfolio. But that didn't leave much left over to take advantage of the fall in prices this week. Now next week I should be able to buy some more, so here's hoping prices stay lowish for another week.

Totally understand....just putting it on think for Winners benefit:-) Cross my mind the other day when the number of AIR small retail investors holding was mentioned...

ps congrats on the milestone:-)

[nzspeak]

Who can catch a falling knife? AIR NZ was a great buy at $3.20 what about now it's under $2? I was shocked a prominent poster on this forum tired to argue that 'dividend stripping' was actually a arbitrage play and not one person in two days pointed out his folly? Please people don't get your finance advice from this forum... you will loose a lot of money....

[percy]

Who can catch a falling knife? AIR NZ was a great buy at $3.20 what about now it's under $2? I was shocked a prominent poster on this forum tired to argue that 'dividend stripping' was actually a arbitrage play and not one person in two days pointed out his folly? Please people don't get your finance advice from this forum... you will loose a lot of money....

A timely reminder.!
Thank you for your post.

[Snow Leopard]

...I was shocked a prominent poster on this forum tired to argue that 'dividend stripping' was actually a arbitrage play and not one person in two days pointed out his folly?...

We will try and do better in future :(.

So come on quote the post - we all want to know what we missed.


...AIR NZ was a great buy at $3.20...

So right there is your first folly :t_up:.

Best Wishes
Paper Tiger

[Jantar]

Who can catch a falling knife? AIR NZ was a great buy at $3.20 .......
Well, maybe not quite a great buy, but certainly a goodbye.

[nzspeak]

"I have seen a big Australian study with heaps of empirical evidence that showed that in most cases shares recovered the dividend paid within a few weeks" This is what I was talking about... Dividend stripping. Possibly the biggest con since the Wolf of Wall Street gave you a cold call...

[Snow Leopard]

Oh this quote:

I have seen a big Australian study with heaps of empirical evidence that showed that in most cases shares recovered the dividend paid within a few weeks. Obviously with the size of the dividend this time one would expect it will take a bit longer. Thank you for posting previous experience with AIR which supports my contention that all other things being equal the SP is likely to recover the dividend in about twice as long as normal due to its substaintial size.


...argue that 'dividend stripping' was actually a arbitrage play...

Well in his defence, he never mentioned arbitrage.

And given the definition of arbitrage: the simultaneous buying and selling of...; you are wrong to try and make the association

And if you want a study showing it works then you can find lots and if you want a study showing it doesn't work then you can find lots.

And dividend stripping was Roger's latest thing and I had got bored of it by then anyway.

Best Wishes
Paper Tiger

[Raz]

Oh this quote:




Well in his defence, he never mentioned arbitrage.



And if you want a study showing it works then you can find lots and if you want a study showing it doesn't work then you can find lots.



Thats the entire point there... you will find a body of research either way...DYOR and make your own play which most people just do and get on with....

[percy]

Thats the entire point there... you will find a body of research either way...DYOR and make your own play which most people just do and get on with....

Agree.
It is all about DYOR and making your own play, and not relying on any anonymous posters on a chat site.

[Harley]

Who can catch a falling knife? AIR NZ was a great buy at $3.20 what about now it's under $2? I was shocked a prominent poster on this forum tired to argue that 'dividend stripping' was actually a arbitrage play and not one person in two days pointed out his folly? Please people don't get your finance advice from this forum... you will loose a lot of money....
You sound like you took finance advice from this forum and lost a lot of money. I on the other hand take all my financial advice from shoe shine boys and taxi drivers and I have done very nicely thank you.

[Beagle]

most cases shares recovered the dividend paid within a few weeks. Obviously with the size of the dividend this time one would expect it will take a bit longer. Thank you for posting previous experience with AIR which supports my contention that all other things being equal the SP is likely to recover the dividend in about twice as long as normal due to its substaintial size.


The hound doesn't care one iota if many are sceptics about dividend stripping...more food for his bowl and he knows its a time honoured and tested method to increase dividend income.

But for those that are interested, hopefully not many, surely the above is pretty easy to understand seeing as its typed in plain English. Lets save the post mortem for 6-8 weeks time eh.

[allfromacell]

"I have seen a big Australian study with heaps of empirical evidence that showed that in most cases shares recovered the dividend paid within a few weeks" This is what I was talking about... Dividend stripping. Possibly the biggest con since the Wolf of Wall Street gave you a cold call...

If one bought on the day the dividend was announced and sold today you would be up a tidy 4.5% with the dividend. I'm not saying it works but it wasn't exactly the worst play you could have made regarding the recent dividend.

[kiora]

Rule for a saw thumb
If everyone from sharetrader us doing it then it won't work