RE:RE:RE:RE:AC Capacity deployedIt is 3 months later and this nonsensical value plunge for AC stock continues. We just did another transcontinental trip and there is lots going that one can observe on this intuitive level that indicates the dire predictions for Air Canada are fabricated.
Back in June there were 5 flights each day each way for the YYZ-YVR-YYZ route. Now there are at least 10 scheduled per day. On the YUL route there were 3 per day and now there are 6 per day each way. I am pretty sure that if anyone of those flights is unprofitable on the leg both ways it is cancelled and passengers are moved to other flight to make them profitable. Monthly Crew time preservation of available hours is a factor as well and often used as the reason for the cancellation. The point is nothing moves unless it is making money.
Prices of flights are currently up about 50% from any one else I talk to. That means the flights do not necessarily have to be full to be profitable like back in 2019.
Every dollar that moves in and out of Air Canada is pushed to be put through the Aeroplan facility which is now fully functioning to produce cash flow and profit for Air Canada like never ever before. How many time does AirlineInvestor have to tell you this stuff?
International travel is still dramatically down. However when it does return there will be lots of room as there is still lots of planes and lots of staff to be brought back to take Air Canada to its full capacity for flying hours. In the mean time folks are getting everyone visited here at home.
The virus is playing out this latest chapter but Vaccination is making and impact and those who will not be vaccinated will not be allowed on flights. Full eradication of the virus can only be acheived by a focused program of global vaccination like with smallpox. If you understand science and math (particularly Statistics) or bother to educate yourself just so you do understand it, you will understand this truth.
In the immediate moment there are 2 things going on. Today is a triple/quadrupal witching Friday for those who understand what this means. If you don't look it up on investopedia. On top of that we have an election on Monday. Both of these are times when the Market goes into deer in the headlights mode and shorts are extremely active taking advantage of the anxiety that both of these events create. That does not mean the clouds will clear Tuesday morning. It just means you need to rely on the fact that companies are still doing business as usual in spite of the nonsense that goes on in the Market. The value is there. Morningside yesterday stated Fair Market Value for Air Canada shares is $28.93 and their predictions are at the least safe and conservative.
We are coming to the end of Q3 and the earnings report will be on November 8th. By then International travel will be limited but still traffic should be up from current levels due to vaccination and testing. The report should put numbers to what we are seeing intuitively in regards to loads, pricing and financial management.
Remember, "The stock market is a device for transferring money from the impatient to the patient."
Don't be a victim.