Welcome to the forum and thank you for sharing. Add in the profit upgrade on 1 June and you're over $3.
A very warm welcome to the forum and thank you for sharing.
Like you, I think this is a superbly managed company and there's many lessons to be learned from the way they develop and execute their strategy.
Some on here wonder why as a dividend hound I follow this company so closely. Baa Baa asked the question last week.
Three reasons.
1. I have a history of acting professionally for private aviation companies.
2. Much like people have a morbid fascination with train wreck companies to learn lessons of what not to do in business (Feltex, IQE, Dick Smith, Pumpkin patch e.t.c.) have all provided valuable business insights into what NOT to do, I see this company as the diametric opposite of that, there are many business lessons to be learned from the way this company is run of WHAT to do to be successful in business
3. I simply like aviation, I think its an exciting and interesting industry.
One further comment regarding First N.Z's analyst price target. One analyst at First N.Z. is a multi award winning bright chap, shame he's not the one covering AIR at that firm. "Last N.Z." as I referred to them as last week, have consistently been very downbeat on AIR. One thought...I suppose if one consistently holds an extremely negative view they're not going to get much one on one time at lunch after the presentation with top exec's. Perhaps he didn't get the special off the record comments and insights other analysts did during that lunch, or maybe he just strongly dislikes the risks inherent in the aviation sector like the occasional person on her loves to beat up on AIR.
It might have escaped some people's attention that they adamantly ruled out any further acquisitions so we can look forward to there being NO chance of an "Ansett Mk3" experience but what are they going to do with circa 80-90 cents per share in free cash flow in FY20, FY21 and FY22 and I wonder if the government will have any say in that ? Food for thought for dividends hounds positioning themselves early ?
I am comfortable with my estimate of $575m for FY17 and think the outlook for FY18 is very sound. Those 10 airlines that launched services here in 1H FY17 with red hot opening specials to build demand (which compromised the yield for AIR in that half), are unlikely to be running their red hot opening specials in 1H FY18. If the route isn't profitable after a year, some will reduce capacity as we've seen already with some airlines, and some will want out.