Sorry, but I don't interpret those sales as being a forebearer of gloom. Insider trading rules are pretty clear, and I think senior management know that....
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Sorry, but I don't interpret those sales as being a forebearer of gloom. Insider trading rules are pretty clear, and I think senior management know that....
Anyway, let's review this in a couple of year, which is my investment horizon. Anything between now and then is largely irrelevant to me personally.
Bottom line for me is its a blue chip stock currently selling at a discount with increasing divvys, happy to hold even though currently in the red.
A couple of weeks ago people here were celebrating $3.
People will see and read into messages what they want to see in them - confirmation bias.
Very interesting following this discussion over the last month - reality is what actually happens not what you want to happen or what the fundamentals (yours) say should happen.
On a more serious note
@AirNZFairy: To kick off the celebrations I'm giving away the below. To be in to win you need to guess what the picture is of :) https://t.co/ULMvtL32uq
Surprisingly bit muted response today from our biggest AIR supporter, Roger....
And in the meantime more staff sales...
https://nzx.com/companies/AIR/announcements/281736
The VAH result I posted about yesterday was a real shocker and I think wanting to sell a flea ridden mutt and actually doing it are two completely different things which begs the question seeing as VAH is presently trading at a loss and at a gearing ratio of 6:1 debt to equity what do AIR's directors do if they can't sell and VAH need another equity injection ? Further, Is the short term loan they recently made within VAH's capability to repay it without an equity injection...I'd have to speculate it isn't.
The $120m of exchange rate tailwind not repeating in FY17 was also a bit of a shock, but with recent exchange rate strength we may see a little less than $120m impact. Consensus analyst estimates for FY17 of 55 cps are going to be downgraded, that is absolutely certain in my opinion. Too difficult to know if consensus analyst estimates of 42 cps for FY18 will change and by how much. AIR's management see yields normalising once new capacity is established and with intrinsic tourism growth but over what timeframe ? Medium term suggests yield compression exists for some / all of FY18 ?
Interesting that they are already planning of shifting capacity onto the Houston route in response to AA's new service.
Fair value for the stock must come back with the VAH matter and FY17 downgrade...by how much is the question and over what timeframe will yields normalise is the other key question.
Less bullish than I was... At this stage my early thinking is somewhere around $650m underlying profit before tax for FY17, about 44 cps after tax, well south of present consensus analyst estimates.
I have pulled back this year's estimate to $850m, no contribution from VAH and less 2H RPK growth than I was previously estimating).
Not intended to be advice and preliminary thinking only. DYOR. Consensus broker fair value is presently $3.16...I see this coming back by 20-30 cents, effect is roughly split evenly because of the VAH fiasco and FY17 earnings downgrade. A successful sale of VAH even at the current market price of VAH shares could see a pop of approx. 20 cps as I think most analysts have or will be heavily writing down the value of VAH in their valuation models.
Given the uncertainty of the VAH sale process and the diabolical state of that company and the FY17 downgrade I'm not expecting a recovery to $3 any time soon, with the obvious caveat that a quick and successful sale of VAH could have precisely that effect or close too it, but I for one won't be holding my breath.
I am disappointed with managements systematic selling down of shares and I find the timing of this a little disconcerting. Management would have known last week when they were selling that there was an investor day this week wherein they were going to downgrade FY17 earnings. Sailing pretty close to the wind in terms of the insider trading rules there by my reckoning.