RE:RE:RE:RE:RE:Too quick, too soon Just so we are all clear on this.... the phenomenon for the rise in share price over the last few weeks is simply "the tide that lifts all ships". Nothing special or magical is happening. Airlines are not flying anywhere near capacity (although they are severely cutting costs).
You don't need to spend days analyzing what the share price could be. The curve is flattening slightly and people are somewhat more optimistic than three weeks ago. Also.. the population is getting more used to the idea of a virus and there isn't as much panic and uncertainty. The QE measures are buoying companies that were at the end of the rope.
moving forward it's going to be a LONNNNG road ahead. And AC given their size has even more of a hurdle to overcome. Flights are not just going to start back up as if nothing happened in 2020 and the airline WILL continue to incur massive costs. It may be well into 2021 that we see a return to the normal. Even if a vaccine was approved yesterday it would still take 14-16 months to bring things back to normal.
the big boys have to cover their shorts for the next leg down. Don't get spanked out by the professionals. Get into gold stocks or something and ride this out. B2Gold?
jjwilson wrote: "This was a $50 stock based on fundamentals at that time it will be a minimum 6-8 months till it is operating at 70% capacity this is a $21 stock"
You're looking at this as a pessimist. Here's how an optimist would see the situation;
Last year, "based on the fundamentals of the day" AC was a $50 dollar stock. This was while in competition with other large international airlines. The other airlines paid dividends and did significantly more share buybacks while banking less contingency cash.
So now we find ourselves in this situation - AC is in much, much better shape financially than virtually any other airline it competes with. Let's say that in 6-8 months the industry is back flying and AC is again in competition with those same large international airlines except now those other airlines are encumbered with re-financed debt, aircraft orders cancelled, possible obligations to repay govenment assistance to some degree while AC is still operating with lower levels of debt, no repayment obligations and a big bank of hedged fuel (that they could afford due to having cash on hand).
If AC was a $50 stock last year (based on the fundamentals) it could very well come out of this situation as a $75 stock (this is not a prediction - just a random number for effect). The industry might only be 70% of what it was but AC could have a bigger portion. As it stands AC did something like 2% of US international volume. Pricing power, Aeroplan points promotions etc could easily drive that number much higher especially if the product is better (which I think it is). Personally I see AC as having the ability to grow significantly when things start moving again.