Comment by xgbssxxon Dec 05, 2024 9:51am
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Post# 36346985
RE:Unexpected strenght
RE:Unexpected strenghtI don't know about others, but I was not surprised. AC was repeatedly sold off and overshorted. Effectively, we are seeing a short squeeze here with sustained buyers creeping in. Add to it the NCIB that was expected to be announced after the pilots deal which the market never recognized prior to it's announcement despite AC's clear history of deploying it, and it's massive cashflow generation, AC was a no brainer. The amount of posting on another forum about how "they won't touch airlines because a, b, c.... (which are usually, Buffett (Well Buffet doesn't like timing certain industries), outdated understanding of the industry, or I hate Air Canada because one vacation....) means that at some point it was bound to flip back up.
The power of economics means eventually, good numbers take hold of price changes.Markets are efficient.... eventually. The fact so many people were negative or shorting it meant the reversion would be quicker and sudden. We are in that, and perhaps as people stop shunning it, we will see further reversion to AC's actual value... until the next world pandemic. We then rinse and repeat.