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Thoughts about airline stock?
Posted on 3/23/20 at 3:11 pm
Posted on 3/23/20 at 3:11 pm
I have been watching American Airlines and it closed at $10.25. We know the Government is going to bail them out, so what are your thoughts on getting into airlines while they are cheap.
6
Posted on 3/23/20 at 3:20 pm to saints5021
If you have extra cash, yes
Posted on 3/23/20 at 3:20 pm to saints5021
I'm staying away from airline stocks as tempting as they may seem.
American Airlines in particular seems like a mismanaged trainwreck the more you research it. It recently disclosed that it has $7.3 billion in liquidity but also has $24 billion in debt (highest among U.S. carriers relative to underlying profits). A government bailout might be a short term fix but I don't see this stock rebounding like others and AA could still be headed for bankruptcy in the next few years.
American Airlines in particular seems like a mismanaged trainwreck the more you research it. It recently disclosed that it has $7.3 billion in liquidity but also has $24 billion in debt (highest among U.S. carriers relative to underlying profits). A government bailout might be a short term fix but I don't see this stock rebounding like others and AA could still be headed for bankruptcy in the next few years.
Posted on 3/23/20 at 3:30 pm to saints5021
A bailout does not mean there isn’t an equity wipeout. Several public companies trading today have gone to 0 before.
Posted on 3/23/20 at 3:42 pm to saints5021
Bought some FedEx this morning.
Posted on 3/23/20 at 5:37 pm to TypoKnig
quote:
American Airlines in particular seems like a mismanaged trainwreck the more you research it.
This. If you want to go the airline route, AAL is the last one I would touch.
Posted on 3/23/20 at 5:55 pm to saints5021
Delta, Southwest, Alaska, and JetBlue have the best cash to debt ratios. American is by far the worst.
This post was edited on 3/23/20 at 5:58 pm
Posted on 3/23/20 at 6:07 pm to Tri City Tigers
This is not true. Delta has a very bad cash position
Posted on 3/23/20 at 6:36 pm to LSUTigers00884
I predict Delta comes out of this a much different airline. I see it scaling back.
The most likely carrier to step in to fill that void? Southwest.
Buy LUV
The most likely carrier to step in to fill that void? Southwest.
Buy LUV
Posted on 3/23/20 at 6:43 pm to Barrister
I don’t really buy that people will stop traveling. Maybe demand will be light at first, but it will return to normal.
Posted on 3/23/20 at 8:36 pm to Huge Richard
Saw this tweet floating around
LINK
quote:
Zoom 2019 market cap: $18.8B Airlines 2019 market cap: $78.1B Zoom current market cap: $44.5B Airlines current market cap: $27.0B Note: Airlines includes Delta, United, American and Jet Blue.
quote:
FWIW, Airlines current enterprise value is $88.3B. (Not investment advice etc.)
LINK
Posted on 3/23/20 at 8:37 pm to Tri City Tigers
quote:
Delta, Southwest, Alaska, and JetBlue have the best cash to debt ratios. American is by far the worst.
You're missing Spirit baw. They surprisingly have the best in the industry.
Delta not so much.
Posted on 3/24/20 at 5:27 am to saints5021
Delta has the best product in the industry followed by Southwest and JetBlue. American has the most debt in the industry and will likely declare chapter 11 sometime within the next calendar year. Spirit is pretty decent.
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