AIR - Air NZ.

**Xerof** · 26-07-2017, 08:55 AM

Raz, no, never used a physical stop order, as they become targets for brokers who treat retail like flies to ping off, but am guessing the recent plunge to 3.20 was your stop being executed? I have a self imposed level for a stop, and if the price CLOSES at or below, I will execute at the next mornings auction

**Raz** · 26-07-2017, 09:13 AM

Originally Posted by Xerof

Raz, no, never used a physical stop order, as they become targets for brokers who treat retail like flies to ping off, but am guessing the recent plunge to 3.20 was your stop being executed? I have a self imposed level for a stop, and if the price CLOSES at or below, I will execute at the next mornings auction

Thanks for for your thoughts, no not the 3.20.. much higher and currently will make on the deal although was not planning to spend the time looking at buying in again..

**GTI** · 26-07-2017, 11:10 AM

Originally Posted by winner69

Your sell order?

I thought you were in boots and all

It was my buy order...

**Snow Leopard** · 26-07-2017, 12:48 PM

Op Stats even more delayed than the midday flight from Ekatahuna.

BW PT

**winner69** · 26-07-2017, 02:00 PM

Originally Posted by Paper Tiger

35 -- EPS best guess for FY2017
(8.5+X) -- the much abused Graham formula
4.4/3.5 -- airline discount factor, accidentally inverted

Should read

0% growth = $0.35*(8.5+0)*3.5/4.4 = $2.37
1% growth = $0.35*(8.5+2)*3.5/4.4 = $2.92

Best Wishes
Paper Tiger

You headed this post 'do a decent DCF'

I don't think anybody bothers do a DCF on airlines - if they do doesn't seem to drive the share price.

Takes an awful lot of future cash flow to get a value of $5.5 billion for AIR - esp if you look at recent cash flows.

Anyway PT - doesn't matter because the market is saying AIRs worth 330 anywhere.

**Beagle** · 26-07-2017, 02:13 PM

Brokers DCF's told us all the company was worth an consensus average of just $2.19 as late as the end of May 2017 when the SP was close to $3.
Every analyst DCF I have seen only forecasts free cash flow for the next five years and then assumes a terminal growth rate of 2% thereafter. and there's the fundamental flaw with their DCF guesses right there. Recent DCF's are not picking up the tremendous free cash flow in the 2023 and 2024 years when the company is still ostensibly on a capex holiday because its outside of the timeframe of their specific 5 year estimates. No wonder very few N.Z. institutions and retail holders left because most are relying on analysts that cannot think further out than 5 years. They should put their headlights on full beam and they might get better visibility !

**workingdad** · 26-07-2017, 02:46 PM

I also think many analysts assumed an increase in base oil prices but even the oil companies are anticipating current prices to remain for the foreseeable future including 2018.

Second article down on this link is interesting supporting low oil prices

https://www.bloomberg.com/news/artic...-with-50-crude

Competition has not had the impact expected, migration and tourism touted to stay high I think AIR going forward is pretty well placed to keep generating good profits. I might have sold half my holdings early in the rise locking in some gains but no plans to sell any time soon for the remainder with a buy in of 2.01 to 2.17 not to mention some good dividends since.

Loose stop loss in place that hasn't been triggered yet but my guess is low volume today while people sit back and wait for monthly stats giving the full year picture a bit more detail.

**Beagle** · 26-07-2017, 03:24 PM

I think the other thing mate is that analysts are not understanding that oil prices and yield are inextricably linked and to some extent new competition emerges with very cheap oil too. You think 10 new competitors would have all opened up new long range routes to N.Z. late last year with $60 oil instead of the $30 oil at that time ?

AIR are well positioned with a very young streamlined and fuel efficient fleet. With $60-70 oil they're probably better positioned from a competitive point of view than they are now. Oil goes back up and so do yields and competition goes down. My core point, mid priced aviation fuel costs are best for AIR.