AIR - Air NZ.

[modandm]

100% correct silverblizzard. The stock is a bargain, with a great yield and lot of growth ahead.

As PT points out airlines are volatile therefore PE's tend to stay low. Of course many of the same investors who suggest airlines are risky are happy to buy 'hot' tech stocks... but hey.

Personally I'm happy to own cheap stocks, it reduces the downside. Plus even if the stock stays cheap on PE, with earnings rising 25% pa and a 7% yield on top its a tasty investment. Any re-rating would be icing.

[silverblizzard888]

Selling price seems to be going up slowly and selling depth reducing by quite a bit.

I agree Modandm, as long as the fundamentals are doing great then there should be no worry at all!

[couta1]

I'm looking at picking up a parcel of these,dividend yield looks pretty average at 4.3% price down a bit today so might be a good opportunity ?

[Arbroath]

I'd say the forward yield is more like 5.9-6.4% based on a 11-12cps payout this year. Interim was up from 3c to 4.5c. Last years final was 5c and my guess they'll pay 6.5-7.5c this year. Airlines can always be tricky and although I'm long AIR I'm married to them. They might string another couple of good years together which could see the PE expand and the shares head towards $2.5-$3 but up there I'd argue they become pretty risky.

I'm looking at picking up a parcel of these,dividend yield looks pretty average at 4.3% price down a bit today so might be a good opportunity ?

[couta1]

I'd say the forward yield is more like 5.9-6.4% based on a 11-12cps payout this year. Interim was up from 3c to 4.5c. Last years final was 5c and my guess they'll pay 6.5-7.5c this year. Airlines can always be tricky and although I'm long AIR I'm married to them. They might string another couple of good years together which could see the PE expand and the shares head towards $2.5-$3 but up there I'd argue they become pretty risky.

Thanks Arbroath,with them going ex divvy on the 12 th,price may go back up tommorow so think I'll grab me 10k shares just for the fun of it

[Jaa]

Just reviewing my AIR holding after the recent share price increase and have come up with a lot of positives to support the increase. Their fleet and route network is looking very good with plenty of capacity increases coming. NZ economic growth will also drive air travel.

The alliance with Singapore Airlines should be very profitable but not at the expense of consumers. Thus I hope it gets approved and I give it a 70% chance of being so. Qantas is making noise as is their way but JetStar's competing service was losing a lot of money and going to close anyway.

Almost like Singapore Airlines have agreed to share some of the routes capacity and profit with Air NZ??? But why give it away? Singapore Inc pulling some strings to direct more traffic through its hub and away from Dubai, Hong Kong and others? Part of a grand plan by Singapore to hurt Emirates, Qantas and the Dubai hub? Or have have Air NZ used their leverage with Virgin Australia to a deal with Singapore relating to Virgin's future at Eithad's expense?

Only negative I could come up with is a lack of an A320 NEO (or less likely a 737 MAX) order. They longer they leave it the more they will pay and the longer they will have to wait for delivery slots. This might be a result of a change in focus under new numbers man Mr Luxon compared to his predecessors. The order may not stack up completely on paper but without it they leave themselves open to new more cost competitive trans-tasman and domestic competition.

[Snow Leopard]

With the government holding the majority and then the SuperAnn Funds doing their trading we end up with SSH announcements like this one:

"Betty is selling"

We are amused
Paper Tiger (by royal disappointment)

[modandm]

PT - yes I found funny too.

Jaa - Wouldn't worry about the a320 neo, they will be leased anyway as is the current SH a320 fleet. I understand they should be coming to a decision soon on a replacement - could be new CEO versions which would have commonality with domestic.

Re the SQ alliance - SQ has been getting hurt by Emirates (badly), not the other way around. By forming a partnership with NZ SQ should be able to reclaim some market share, but more importantly get access to NZ's frequent flyer base, which is higher yielding. It's pretty win-win.

Happy with the increased shareprice obviously. Also NZD is stronger and Fuel lower. Management are talking about 8% ASK growth in FY15. I have them earning 30c next year on my base case of 6% revenue growth, FX at 83c and Jet Fuel at $128. Once again this is well above what the broking analysts expect (they are anchoring, and don't seem to calculate fuel as accurately as I have over the last 2 years...) On 9x that gives you 2.70 to 3.30, so a good 50-70% upside including dividends.

Yes I'm still in love with the stock - and in deeper then ever!

[slimwin]

Apparently Boeing have put a very good offer in for the Max but Luxon likes fleet commonality...

Won't affect the share price whichever way it goes. Both will be very good aeroplanes.

[airedale]

I don't follow Air NZ but my daughter has some. Her latest statement from the share registry shows that her holding was reduced by 10% on 8/4/14 under the heading "scheme of arrangement". She has not sold any shares. Does anyone have info on this "scheme of arrangement"?