AIR - Air NZ.

[Beagle]

$500m = 32 cps after tax. 10 year average PE is 11. I believe one could legitimately make a good case that the intense level of competition currently being experienced is amongst the very strongest they've seen in their 77 year history and yet the resilience of their business is such that they're still making a very healthy profit.
I will leave people to decide for themselves what PE they think is right for whatever part of the cycle they think the airline is at. I will only say that I am very comfortable with my current holding and the current price and am confident of the very strong dividend yield case that's supporting my investment decision.

[couta1]

But look at the ridiculously low PE it was also on then

AIR has been so great since its being RERATED - much higher PE on slightly reduced profits equals $3 plus

And markets are happy as

No worries

You in boots and all, aye winner? PS-Im not buying back in yet as I reckon a better entry price will come over the next couple of months, if not I'll just load up on another high divvy paying stock, $3 or near it is a sell on this stock not a hold.

[stoploss]

You in boots and all, aye winner? PS-Im not buying back in yet as I reckon a better entry price will come over the next couple of months, if not I'll just load up on another high divvy paying stock, $3 or near it is a sell on this stock not a hold.

Why bail at $ 2.50 then ?

[Beagle]

You in boots and all, aye winner? PS-Im not buying back in yet as I reckon a better entry price will come over the next couple of months, if not I'll just load up on another high divvy paying stock, $3 or near it is a sell on this stock not a hold.

I wouldn't be so sure mate. Management seemed very confident at the half year conference call that the outlook for yields in the current half and beyond was improving.
Typical airline behavior from new entrants establishing new routes like a lot did to N.Z. last year is to discount really hard at the outset to establish demand and build the route and if its not profitable within 12 -18 months, review it. I think we've already seen a very high "spring tide" on the competition and aggressive pricing from competitors front and new competitors building their route to N.Z. will want to see profitability in 2017 or otherwise... Comments from the CEO of Qatar last week suggested lil ol N.Z. is an extremely expensive route for them and they'd quit the route if they weren't happy with laptop restrictions...reading between the lines, I would add "if market demand isn't there for any other reason that would make the route unprofitable".

I reckon one or two people on here waiting for a GFC Mk2 and wanting to buy this company for a real bargain price would be well advised not to hold their breath

I think to invest in this company one has to work out what their investment case is. Short term its not cheap, long term I am as confident as you ever can be with any company in a volatile industry that the dividend yield case is very compelling indeed. For what its worth, I am looking to increase my stake at circa $2.50 if it gets back down there at some stage over the next few months.

[Everwood]

Does anyone have any estimates on what the full year dividend, including any potential special dividend might be?

[Jantar]

Does anyone have any estimates on what the full year dividend, including any potential special dividend might be?

My estimate is 10 cps

[Raz]

My estimate is 10 cps

I not selling my long term holding..AIR has been so clever on its marketing this year and the competition has not gained a foothold in the AUK-LAX route. AA full relaunch in Oct however they lack the depth of service to compete. The advantage of the domestic network they have used well..sucks to pay the premium as a customer however to your advantage if your a shareholder. If you want to pay a fair price for air travel you naturally have to hedge by gaining the dividend to offset. I found some great deals this year however the industry has made me work hard for them..so much harder than in the past.

They do have to look at the logistics for Europe travel as they do not have the natural advantage....suspect that when load factors have been hit hard with the Chine cheapie options and Emirates and Singapore having the stronger branch network to Europe for the price point.

The social marketing and data management of AIR have stepped up this year as well...they have impressed and I'm all in.

[couta1]

Why bail at $ 2.50 then ?

Reread post # 10912, and it was below $2.50.

[iceman]

About to board Air NZ Dreamliner for Buenos Aires and they announce an "unserviceable fault" with the plane. At least 2 hours wait for a different plane. Hopefully nothing very serious with the Dreamliner !!

[Beagle]

Does anyone have any estimates on what the full year dividend, including any potential special dividend might be?

10 cps and absolutely no chance of a special this year as gearing limit simply will not allow it and it wouldn't be prudent.

I not selling my long term holding..AIR has been so clever on its marketing this year and the competition has not gained a foothold in the AUK-LAX route. AA full relaunch in Oct however they lack the depth of service to compete. The advantage of the domestic network they have used well..sucks to pay the premium as a customer however to your advantage if your a shareholder. If you want to pay a fair price for air travel you naturally have to hedge by gaining the dividend to offset. I found some great deals this year however the industry has made me work hard for them..so much harder than in the past.

They do have to look at the logistics for Europe travel as they do not have the natural advantage....suspect that when load factors have been hit hard with the Chine cheapie options and Emirates and Singapore having the stronger branch network to Europe for the price point.

The social marketing and data management of AIR have stepped up this year as well...they have impressed and I'm all in.

Agree 100%. Nice to hear that by and large you are impressed.

About to board Air NZ Dreamliner for Buenos Aires and they announce an "unserviceable fault" with the plane. At least 2 hours wait for a different plane. Hopefully nothing very serious with the Dreamliner !!

They have plenty of local engineering expertise on hand at Auckland. Unserviceable simply means cannot be fixed within the tight timeframe required for operation of that flight with that aircraft. Boats are very complicated machines as you know mate but planes are in another league altogether and things do need fixing on a very regular basis...30,000 individual parts just in each Rolls Royce Trent engine !