AIR - Air NZ.

[nztx]

When they run out of money again next I wonder what the novel ingenious plan will be.

Just a matter of time to see how many of the punters have run shy on dough too IMO

[Maxtrade]

By giving rights at very attractive price of 53 Cents will make sure AIR issue will be oversubscribed ...so propping efforts of underwriters will be minimal ...just lip service and good press will do

Post Cap Raise a truck load of shares will hit the market for sale, those that are placing their bets that their cost averaged price, inclusive of the 2 shares at 0.53, will be lower than where the market stabilises and SP settles in at. Unfortunately some who are counting on a quick profit might be rudely awakened and find out their coast average price is significantly higher than where SP stabilises. In turn a heck load of shares sitting to be offloaded with traders who bet the wrong way cutting their losses, hitting their stop loss, and the vicious cycle of post CR pulling SP down to potentially even lower than the offer 0.53. We have seen it many times before with large Cap Raises. Just take a look how they have played out with some of the recent ones. HUGE gamble those that are counting on SP rallying post CR. Regardless on if oversubscribed or not, there will be a large percentage of people looking for an SP post Cap of 0.8 plus and hoping to sell out making a quick 10-20% profit off their cost average price. For that to work their cost average AIR shares would need to be no more than 0.60c. There will be a lot of investors who's cost average price is nothing like $0.60. If their cost average price is more like 0.7- 0.8 (for those that were buying in AIR last week at 1.15 or higher), even factoring in the 2 shares @ 0.53 it doesn't help. With the cost average sitting at for example 0.75 then to make their 10-20% the SP would need to stabilise at 0.90 Which I think all can agree is not going to happen. Once the reality of this settles in many will realise their bets turned bad and they hold 3 times the amount of AIR shares which wouldn't have provided any quick profit. Shares will flood onto market trying to minimise losses or break even at best in turn putting further downwards pressure on the SP.

SP has a long way to fall yet. Wont reach it's lows until post Cap Raise once offload of shares commences. Possibly for a lucky few at a small gain if somehow they have a low enough Cost Average, but for most very quickly tides will turn on the sell off, buyers will dry up due to the fact most would have already purchased in the massive Cap Raise. Sell volumes will swell onto market depth. SP will only have one direction to head.

And all said above isn't even factoring in the difficulties the company itself faces. Combined with Zero dividends. How on earth is that looked at as a stable or sound investment.

It was a smart way to 'extort' money out of exisiting share holders (trying to minimise losses due to dilution) and encourage new unsavy investors to jump in and take 'advantage of the low CR offer. The positive is at least it gives our National Airline some breathing room and dig its way out of their current debt. However they aren't a charity! Not a wise investment move, or trading play even with share price allocation of 0.53.

Once people see the SP stall post Cap Raise after an initial short minor rally off the back of an over-prescribed 0.53 offer, volumes will flood onto the sell side and SP will downtrend. Analysts suggesting 0.6- 0.64. In reality history would suggest we will actually see a downtrend in SP back to more like around the SP offer of 0.53. Let's check in and see how accurate this post is to follow, 1 month post CR allocation. Anyone keen to put forth their target SP?

0.51- 0.56

[nztx]

It's going to be interesting to see what the post Cap Raising Party auction of the plates left over
on the AIR table comes in at - any guesses ?

Given AIR rights aren't being traded on ASX - the decisions there must be to take up or not

[Pitch Group]

I reckon 0.63-0.65 Fingers crossed

[nztx]

Post Cap Raise a truck load of shares will hit the market for sale, those that are placing their bets that their cost averaged price, inclusive of the 2 shares at 0.53, will be lower than where the market stabilises and SP settles in at. Unfortunately some who are counting on a quick profit might be rudely awakened and find out their coast average price is significantly higher than where SP stabilises. In turn a heck load of shares sitting to be offloaded with traders who bet the wrong way cutting their losses, hitting their stop loss, and the vicious cycle of post CR pulling SP down to potentially even lower than the offer 0.53. We have seen it many times before with large Cap Raises. Just take a look how they have played out with some of the recent ones. HUGE gamble those that are counting on SP rallying post CR. Regardless on if oversubscribed or not, there will be a large percentage of people looking for an SP post Cap of 0.8 plus and hoping to sell out making a quick 10-20% profit off their cost average price. For that to work their cost average AIR shares would need to be no more than 0.60c. There will be a lot of investors who's cost average price is nothing like $0.60. If their cost average price is more like 0.7- 0.8 (for those that were buying in AIR last week at 1.15 or higher), even factoring in the 2 shares @ 0.53 it doesn't help. With the cost average sitting at for example 0.75 then to make their 10-20% the SP would need to stabilise at 0.90 Which I think all can agree is not going to happen. Once the reality of this settles in many will realise their bets turned bad and they hold 3 times the amount of AIR shares which wouldn't have provided any quick profit. Shares will flood onto market trying to minimise losses or break even at best in turn putting further downwards pressure on the SP.

SP has a long way to fall yet. Wont reach it's lows until post Cap Raise once offload of shares commences. Possibly for a lucky few at a small gain if somehow they have a low enough Cost Average, but for most very quickly tides will turn on the sell off, buyers will dry up due to the fact most would have already purchased in the massive Cap Raise. Sell volumes will swell onto market depth. SP will only have one direction to head.

And all said above isn't even factoring in the difficulties the company itself faces. Combined with Zero dividends. How on earth is that looked at as a stable or sound investment.

It was a smart way to 'extort' money out of exisiting share holders (trying to minimise losses due to dilution) and encourage new unsavy investors to jump in and take 'advantage of the low CR offer. The positive is at least it gives our National Airline some breathing room and dig its way out of their current debt. However they aren't a charity! Not a wise investment move, or trading play even with share price allocation of 0.53.

Once people see the SP stall post Cap Raise after an initial short minor rally off the back of an over-prescribed 0.53 offer, volumes will flood onto the sell side and SP will downtrend. Analysts suggesting 0.6- 0.64. In reality history would suggest we will actually see a downtrend in SP back to more like around the SP offer of 0.53. Let's check in and see how accurate this post is to follow, 1 month post CR allocation. Anyone keen to put forth their target SP?

0.51- 0.56

Yep .. I would think not far off the mark - look at recent NZX & ARV Cap Raises & look what happened after

AIR is considerably larger with likely huge quantities more rights / shares all looking for
a home.

We may even see a sub 50c AIR SP briefly - who knows

[Maxtrade]

Yep .. I would think not far off the mark - look at recent NZX & ARV Cap Raises & look what happened after

AIR is considerably larger with likely huge quantities more rights / shares all looking for
a home.

We may even see a sub 50c AIR SP briefly - who knows

Agree. RAD, PEB same trend off Cap Raise. Until a company can fundamentally show something solid and positive solid off a large Cap Raise the SP can only decline to the CR offer or lower. AIR will be no different. Quite amazing how many punters are out there that don't seem to bother doing their homework.

[flyer]

I sold out of AIR on 7 Feb 20 for $2.835. Since then I have watched it go down but it stayed over $1 which amazed me as with no flying, no income etc the price should of been under $1 with even a 40-50c price in the last 2 years. The patriotism this company has is huge and there is nothing more proud of seeing the big Tail Koru when you walk into an overseas terminal. We all knew a CR was coming so at what price should Air be now. At one AIRGA (0.48c) you can buy 2 x shares at 53c = $1.54/2 so those 2 shares will cost me $0.77 compared to todays market price of 84c. But I think the Rights will sell off and go lower as entitled holders who may not want to buy into the new shares sell off and the rights price could drop a lot closer to ex date. So if rights dropped to 10c plus your $1.06 = 58c per share which is good discount vs todays market price. However, the main shareprice could also fall to its take up offer price of 53c.
So what will be the best action to take. For me, I am going to wait until after CR date and see what the price is then which I think will be somewhere 53-58c. If it then drifts down into the 40's then I will look to take a new long term stake.

[BlackPeter]

I sold out of AIR on 7 Feb 20 for $2.835. Since then I have watched it go down but it stayed over $1 which amazed me as with no flying, no income etc the price should of been under $1 with even a 40-50c price in the last 2 years. The patriotism this company has is huge and there is nothing more proud of seeing the big Tail Koru when you walk into an overseas terminal. We all knew a CR was coming so at what price should Air be now. At one AIRGA (0.48c) you can buy 2 x shares at 53c = $1.54/2 so those 2 shares will cost me $0.77 compared to todays market price of 84c. But I think the Rights will sell off and go lower as entitled holders who may not want to buy into the new shares sell off and the rights price could drop a lot closer to ex date. So if rights dropped to 10c plus your $1.06 = 58c per share which is good discount vs todays market price. However, the main shareprice could also fall to its take up offer price of 53c.
So what will be the best action to take. For me, I am going to wait until after CR date and see what the price is then which I think will be somewhere 53-58c. If it then drifts down into the 40's then I will look to take a new long term stake.

Predicting future share price bottoms is like predicting your future based on a newspaper horoscope. Sometimes entertaining, however there is no correlation at all between prediction and outcome.

Sure - the AIR shares might bottom out around the magic 53 cents, but then - they might not. The odds are clearly stacked against this option.

They might bottom out around half of that ... but hey - who knows. I don't think it is sensible to set in the current situation any buy in prices ... just wait for the game to play out and buy if and when the technical indicators start to look friendlier. I am thinking something like confirmed break through the MA100 plus supporting fundamentals (which look terrible at current).

At this stage we don't even know, whether this is the last CR before the recovery ...

So many other opportunities to park ones money ...

[winner69]

Radius Healthcare shares were about 170 once. Drifted down and settled around 90/100 mark for a period. Radius needed some cash so had a capital raise with new shares at 52 .... punters scrambled to get their hands on them .... cheap, huge discount etc etc

Share price went down to the 60s and then the 50s and then the 40s and now in the 30s heading to the 20s

Maybe AIR share price will head down to 60's and then the 50's and then the 40s and then the 30's and maybe the 20s as well

last time I sold AIR shares I got $3.27 for them

[Waltzing]

"maybe the 20s as well"

NAH the SHAZ will make sure of that... maybe go without bread that week... ARHH KFC ...