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Thread: AIR - Air NZ.

  1. #17371
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by Blue Skies View Post
    You're probably right, but there's a yawning gap between the position US airlines & AIR find themselves in.
    As Gregg Foran said last Friday on radio interview, 2/3rds of AIR revenue was International & thats all gone. ( a significant part of that was US routes which won't be back anytime soon, not a lot of profit in Trans Tasman)
    Domestic accounts for only 1/3rd of their revenue so that's all they've got to 'revive, survive & thrive' (nod to the marketing dept) on.
    At mo Domestic is operating on about 30% of normal & they are aiming to achieve 50% before the end of the year.


    There seems to be a perception amongst recent AIR investors that the airline is too important to NZ to be allowed to fail, so their investment is completely safe. This was stated to me again this morning by a recent investor.
    Foran stated AIR will need the Govt loan within months & will need all of it.
    As I understand it, the Govt loan is 'convertible' so if AIR are unable to repay it, the Govt will convert the loan to shares in the remaining 48% on AIR they don't already own, severely diluting the value of other shareholders shares. I suppose the Govt could write off the $900M loan but can't really see that being a politically acceptable option, bailing out private 'wealthy' shareholders with tax payers money when Health Education Housing etc will be crying out for money.
    Is that the way others more informed than myself see it?
    Neither AIR nor the Govt have disclosed the conversion terms of that loan. The only other clues we have that it might be very tough on minority shareholders is the eyebrow raising interest rate the Govt are charging AIR of up to 9% " the Government having the ability to seek repayment through a capital raise by the airline after six months, or converting the loan to equity (subject to compliance with laws and any necessary regulatory and/or shareholder approvals". Extract from 20 March loan agreement announcement.

    One final clue is that the next business day after the 20 March 2020 loan agreement the share price of AIR was just 80 cents.
    Is it possible that AIR being desperate for the money agreed to give the N.Z. Govt the option to convert its loan at a price of the lower of the volume market weighted average price before a new market capital raise or perhaps as little as 50 cents per share ?

    I know Jardens have warned their clients of the strong possibility of shareholder dilution when they came to a target price of just from memory 80 cents.

    Hey Winner, guess what flight level the average analyst has AIR at in 12 months time https://www.marketscreener.com/AIR-N...407/consensus/ Yeap, you guessed it, FL100
    Last edited by Beagle; 06-06-2020 at 03:18 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

  2. #17372
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    2016....AIR announced record profit ...special dividend 25c. SP went down to $1.70

    Now...AIR only running at 5% of entire business...and SP is almost the same with 2016 financial year.

    Oh Lord...what is going on with our greedy world. I think all fundies will use this trap to slowly exit and all be left newbies....

    I am like you Master Beagle . Too scare and look at the current fundamentals... basically is not connecting with the real world

    I hope I am wrong....at the means time...enjoy the gain guys. . ....

  3. #17373
    Speedy Az winner69's Avatar
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    This random guy on sharesies is on to it

    I think you're all underestimating what's going to happen if the tasman bubble comes into play. It's hoped to be started up by the end of July so it's really anyone's guess. If the announcement is made international travel can resume I doubt the share price will crash,I'd wager the opposite and we'd see it hover at 2.10
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  4. #17374
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    Classic ....all these newbies at the sharies. They all said...long term...long term..but once u are the online flat form and u are able to sell n buy....when the market in bear again....all the sheeps will follow ..

    Mark my word....so far...my gut always right...

  5. #17375
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    Quote Originally Posted by King1212 View Post
    2016....AIR announced record profit ...special dividend 25c. SP went down to $1.70

    Now...AIR only running at 5% of entire business...and SP is almost the same with 2016 financial year.

    Oh Lord...what is going on with our greedy world. I think all fundies will use this trap to slowly exit and all be left newbies....

    I am like you Master Beagle . Too scare and look at the current fundamentals... basically is not connecting with the real world

    I hope I am wrong....at the means time...enjoy the gain guys. . ....
    I was an investor at that time and really enjoyed that 25 cent special divvy and the 10 cent ordinary divvy that went with it and thank you for reminding me mate, the business was in vastly better shape than it is presently. There is no comparison, complete chalk and cheese.

    I wonder if it is a coincidence that many think of the shareies crowd as the "shoeshine crowd" like the old shoeshine boy, the last to hear and act and that both shoeshine and sharsies start with "sh" In terms of investment outcomes I got to pondering what four letter word might best describe the likely outcome they will get from their speculation that also starts with sh.. ? Hmmm
    Last edited by Beagle; 06-06-2020 at 06:49 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

  6. #17376
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    Quote Originally Posted by Beagle View Post
    I was an investor at that time and really enjoyed that 25 cent special divvy and the 10 cent ordinary divvy that went with it and thank you for reminding me mate, the business was in vastly better shape than it is presently. There is no comparison, complete chalk and cheese.

    I wonder if it is a coincidence that many think of the shareies crowd as the "shoeshine crowd" like the old shoeshine boy, the last to hear and act and that both shoeshine and sharsies start with "sh" In terms of investment outcomes I got to pondering what four letter word might best describe the likely outcome they will get from their speculation that also starts with sh.. ? Hmmm
    There’s over $80 million invested in that sharesies ...pretty rich shoeshine crowd

    Mind you average wallet about $1,400
    Last edited by winner69; 06-06-2020 at 07:00 PM.
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  7. #17377
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    Not only on sharies...a lot of them have asb ac n direct broking too...a lot of them are reading your posts...n all laughing at us ..... thinking we all here missed the boat.....

  8. #17378
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    Air NZ's share price performance is not out of whack with other global airlines. Unlike Singapore and Cathay, Air NZ has an almost COVID free and profitable domestic market to fly in.

    While historically Trans Tasman has not been very profitable for Air NZ this has not been true for the last 5 years or so where Air NZ has dominated its competitors and made good profits. Its most profitable long haul routes was always the USA routes, one of which is still in operation.

    Throw in government wage subsidies, reduced aviation fees, higher prices, lower fuel costs, reparation and increased cargo flights/prices and it is pretty obvious some on here have been overly pessimistic.

    Airline share price comparison, from 2020 low to post mid-March high (mostly yesterday's closing price).

    Air NZ
    L: 0.8 H: 1.64 = 105%

    Air Asia
    L: 0.5 H: 0.86 = 72%

    American Airlines
    L: 8.25 H: 18.59 = 125%

    Cathay Pacific
    L: 7.50 H: 9.39 = 25%

    Delta
    L: 17.51 H: 34.16 = 95%

    Jet Blue
    L: 6.61 H: 13.69 = 107%

    Qantas
    L: 2.03 H: 4.63 = 128%

    Singapore Airlines
    L: 3.53 H: 4:41 = 25%

    Southwest Airlines
    L: 22.46 H: 38.18 = 70%

    United Airlines
    L 17.80 H: 42.40 = 138%

    Ignoring the two Asian airlines that lack domestic markets it would seem Air NZ's share price run still has a bit to go compared to other full service airlines. A 125% increase from the bottom would give $1.80, price target for Monday?

  9. #17379
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    i thought AIR had some oil hedging. Some one even calculated the value of the hedges? prehaps some with expertise in that area could enlighten us?

  10. #17380
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    Really? your gut is always right?

    I have no personal opinion on AIR and have never held, but the reality is - none of you actually know anything for certain, anymore than anyone else does. It is all speculation and supposition, until it’s not. Some of those Sharesies “sheep” as you call them, are not stupid. They took a calculated risk buying AIR cheap, and are willing to take a long term gamble on it paying off. Just as more than a few of us here, are with Blis.

    Who knows? In 15-20 years AIR might reward them for that risk. None of you know for sure, one way or the other. These are not normal times. Anything is possible.

    Just saying.

    Quote Originally Posted by King1212 View Post
    Classic ....all these newbies at the sharies. They all said...long term...long term..but once u are the online flat form and u are able to sell n buy....when the market in bear again....all the sheeps will follow ..

    Mark my word....so far...my gut always right...

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