A lot of others factors to consider with a volatile cyclical. PS-There are SUM other good stocks worth buying, along with some others on the NZX, depending on what result you want from the stocks you buy.
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Sold mine yesterday for $3.185..couldn't resist! Hope to be back in again for the Dividend. ..still like the company tho!
I might wait until after the NZShareholders meeting in AKL on Wednesday night..already own some THL and would like more..and like the look of TRA so will enjoy listening to the CEO's before deciding.
AIR have made steady ongoing improvements in their business model and what we've seen this year which is brand new evidence is their model is now incredibly resilient and highly profitable even in the face of a substantially changed competitive environment. This gives a LOT of confidence looking into the future.
Nobody can reliably tell you where we are in the business cycle. This year I believe we are looking at ~ $575m before tax giving approx. $414m after tax or ~ 37 cps.
The ten year average PE is 11. Pure cyclical companies with no earnings growth should trade on a PE of 10. It is clear that there is some ongoing growth across business cycles, IATA for instance are forecasting ongoing international passenger growth of 5% per annum. I believe in that context a PE of 11 is very reasonable. Further, we live in an ultra low interest rate so adding another 1 multiple for that seems reasonable. A PE of 12 and EPS of 37 cps gives $4.44. (This assumes AIR is currently trading in an operating environment at the mid point of the cycle).
Its clear we're seeing an improving yield environment and competitors are behaving in a generally more rational manner. As I mentioned several times last year, opening specials by new competitors don't last indefinitely so the yield outlook as we lap the period of time in 1H FY17 when ten new competitors were running opening specials for months on end, looks like improving further.. I think the outlook for FY18 and beyond is very sound. N.Z. is a very, very safe destination for tourists and I expect this factor will become increasingly important in the years ahead. I think the outlook as they complete their capex program, fly one of the youngest and from an operational perspective one of the most streamlined fleets in the world and continue to drive efficiencies in their business model and grow in a disciplined manner in line with demand growth, is very bright indeed.
I bought in a 2.97, a day after the earnings announcement. Just sold out today for 3.185, for a tidy profit. Thinking that we might've hit the top for now.
A few cuts in Status Points and Airpoint Dollars in the works from 1 July, especially for regional travellers. The minimum SP earn on regional routes has been cut from 8SP to 4SP.
Like your shorting dag; thats some maths.ps you can edit your post if you weren't shorting:mad ;:;)
I got itchy fingers too, so sold out at $3.195 yesterday.
I hope I won't regret that move. I've had most of my holding since $1.25 four years ago so it's been a great performer for me. Best of luck to those still holding.
from australia
After a decade of underperformance and a stunning turnaround over the last three years, Qantas’ stock price has finally hit the $5.45 price that former chair Margaret Jackson said shareholders would be stupid to reject (when somebody tried to buy them)
Wow - and AIR reaching towards new highs (for 15 or so years) ....AIRlines in favour eh
Yes, even bigboy Buffett who hates airlines now loves airlines. I will also disclose that I sold out yesterday, but only to be poised for entry into another entity, a world away from airlines but just as turbulent.
USA AIRLINE STOCKS HEALTHY TOO Read more »
Great cycle to be in; will follow the trend to the bend ,at the end.
rally at closing. must be some Instos doesn't want to miss out the bargain :cool:
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