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11-01-2017, 07:23 PM
#10091
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11-01-2017, 08:10 PM
#10092
Originally Posted by vici
What's the feeling on AIR short-medium term?
A couple thoughts:
The current management have done a spectacular job in cost cutting + implementing efficiency initiatives (streamlining the fleet, cutting out older less fuel efficient models) + taking advantage of very favourable industry economics (cheap oil prices, general trend up for travel, etc) over the past few years have seen the business do extraordinarily well during that time.
However it always makes me nervous to see management get so much of their remuneration in options diluting shareholder wealth, especially when they seem to cash them in immediately as they receive them. It does not inspire confidence.
I get the impression that a lot of the cost saving initiatives have bottomed out, oil prices are always unpredictable but unlikely to be as low they were 2016 (but who can tell really), and with the revenue growing at a much lower rate than the bottom line, it will be very difficult for the business to get close to it's 2016 performance.
On the flip-side, it basically has a stranglehold on the domestic market with a dominant market share. Although barriers to entry are low, it has been proven over the years that it is very difficult for 3 airlines to profitably operate. The growth play for them is the international flights, which has plenty of competition, but Air NZ has a good reputation and has steady growth in this space. And of course the dividend is very attractive.
Even so, with a current P/E of ~5-6, seems like the market is being overly cautious of AIR.
People don't forget easily do they? Dangers of airline stocks and vulnerability to oil prices and the threat of competition seem to be the main factors keeping this down. Any other perspectives?
Same me with my thoughts..that why I sold mine with tiny profit but good chunk of last dividend...n swap with EVO
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11-01-2017, 10:31 PM
#10093
In reply to a now deleted post
Roger.
think you link was for this:
http://www.forbes.com/sites/afonteve.../#2a388143450c
refers to 787-8's
Best Wishes
Paper Tiger
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11-01-2017, 10:59 PM
#10094
Originally Posted by Paper Tiger
Yeap that's the one, got frustrated the link didn't work for me.
AIR was a launch customer for the 787 as you know and committed to the contract over a decade ago in conjunction with a large order, (for them) of 777's.
They have said they were extremely pleased with the deal they go which involved an unprecedented discount for them. They would have also got significant additional concessions in regard to the delay caused by the battery issue and manufacturing delay's. C.L. let their $150m cost for 787-9's slip in the 2015 annual meeting. Was he talking Kiwi or $U.S., that's the question ? Certainly to the best of my recollection there was no mention of $U.S prefacing that figure mentioned at the time but I accept its normal in aviation circle's to talk numbers in $U.S.
How's the Tiger profit model looking for FY17 looking mate ?
Last edited by Beagle; 11-01-2017 at 11:02 PM.
Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
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11-01-2017, 11:53 PM
#10095
All educated guesses come with a 95% confidence interval and are ISO14001 compatible
Originally Posted by Roger
...How's the Tiger profit model looking for FY17 looking mate ?
I have a feeling of deja-vu here so may be I have posted some of this (perhaps this?) before but...
The plausible, but hopefully unlikely, worst case is NPBT of $370M which we really do not want.
I am currently leaning towards a realistic NPBT of $450M and an optimistic $490M.
Whatever 2017 is, expectation is that 2018 will be worse.
Best Wishes
Paper Tiger
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12-01-2017, 09:41 AM
#10096
Originally Posted by winner69
Seems 225 a bit of a hurdle to overcome
C'mon seeweed start buying more and give the share price a boost
Beter to average up than average down.
On holiday at moment. Sold some a little while ago, but will be back in about 6 weeks from now.
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12-01-2017, 10:49 AM
#10097
Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
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12-01-2017, 10:56 AM
#10098
Originally Posted by Roger
Don't think these guys really have any idea in terms of target prices, they keep downgrading it, even the fickle market doesn't agree with them. Couta's target price remains unchanged at $2.50
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12-01-2017, 11:08 AM
#10099
Originally Posted by couta1
Don't think these guys really have any idea in terms of target prices, they keep downgrading it, even the fickle market doesn't agree with them. Couta's target price remains unchanged at $2.50
Their profit forecasts are pretty bullish - even higher than Tigers
When investors are euphoric, they are incapable of recognising euphoria itself
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12-01-2017, 12:06 PM
#10100
Snoozing by the food bowl
Any divvy hound worth his salt won't care about minor deviations from the main theme and will note that even based on brokers conservative forecasts AIR have plenty of money to pay their regular 20 cps annual divvies through to FY19 and after that we have a meaty capex holiday so the feeds should get even bigger from there
Ecclesiastes 11:2: Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
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