And here's me stressing about my pathetic sum! hahaha
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And here's me stressing about my pathetic sum! hahaha
Just had a fund manager on CNBC talking about US airlines . He Sees them as " crazy cheap "
He noted the whole industry is different to the way it was 30 years ago ....not as risky .
Yes its starting to look that way but its early days. Interestingly AIR started the month of June at what looks like $2.22 from the chart I brought up this morning and hit a low of $2.02 at one point very late in June, so a drop of just on 10% despite AIR extricating itself from Virgin at what many consider to be a good price in the circumstances.
Speaking of cyclical's and crazy cheap, I remember years back when NZR got down to a PE of only 4 because every man and his mutt thought the world was ending in regard to refining margins...a lot of money was made from that stock in the years that followed and I can't help wondering if history won't repeat for AIR seeing as so many people think their margins are going to the dogs.
just attached my post#7198 here:
American Airlines CEO claims the industry has permanently solved its biggest problem
American, Delta, and United have all recently reported record profits after decades of struggle.Last year, American Airlines saw its profits surge 50% to $6.3 billion.
According to Skift's Brian Sumers, one major airline CEO believes the industry has solved its profitability problem for good.
"My personal view is that you won’t see losses in the industry at all," American Airlines CEO Doug Parker said at the airline's annual meeting last week. "We have gotten to the point where we like other businesses will have good years and bad years, but the bad years will not be cataclysmic. They will just be less good than the good years."
Although revenue growth across the board slowed down in the first quarter of the year, the airline industry is still going strong.
Even though Parker, as noted by Sumers, has long been an optimist in the strength of the airline business, his optimism is not unwarranted.
The airline industry has traditionally been a very volatile business with thin margins and high capital requirements. That's means the room for error is very narrow. As a result, in decades past, airlines have often teetered near bankruptcy.
Over the past few years, there's been a fundamental change in the way major US airlines are run. After the latest round of bankruptcies and consolidation that saw American merge with US Airways, Delta with Northwest, and United with Continental, it seems airline management has become more focused and efficient.
Airlines have been careful to exercises discipline in expanding capacity and routes. They have also keyed in on the areas that deserve the most investment and what customers can do without.
Although cheap crude prices over the past 24 months have certainly boosted airlines' financial performance, it would be unfair to attribute it solely to lower fuel expenditures.
Last month at Delta's media day, CEO Ed Bastian noted that current oil prices are nearly identical to that in 2005. That year, both Delta and future merger partner Northwest filed for bankruptcy. In 2015, Delta reported $4.5 billion profits while returning $1.5 billion in profit-sharing to employees.
No argument from me.
Interestingly off 4traders today based on consensus analyst forecast
Delta FY17 PE 5.77 and projected price to NTA 1.51
American Airlines FY17 PE 5.35 and price to NTA 2.24
Compared to downunder carriers
Qantas FY17 PE 4.64 Projected price to NTA 1.22
Air N.Z. FY17 PE 4.07 Projected Price to NTA 0.93
That's before we start talking about who has the most conservative gearing or who has the best dividend yield by a country mile.
Another day finished with green arrow...looks good from here, I think.
Glad this episode is over ....
http://www.theage.com.au/business/av...06-gpzmea.html
Wonder how the AIR loan to them being repaid will reflect on the books - guessing it will be in 2017 financials but yes, pretty happy they got out of that one and now the VAH share price is 20-21c with potential to slide more this month.
NZ version of the same...
http://www.nzherald.co.nz/business/n...ectid=11669834
The sale of AIR's stake just looks better and better. What a flea bitten mongrel ! I see little if any value in VAH and I think their business model is systemically flawed. I suspect most of the airline investor's are simply there for the alliance benefits. I cannot see a single reason for Joe public to invest in VAH at any price. Its great that AIR's shareholder loan is being repaid out of the cash issue proceeds. Hope they sell the rest of their minor stake in Ansett MK2 soon.