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Goldman Sachs And Austrian Airlines-striking ...  
User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 25
Posted (6 years 3 months 3 weeks 8 hours ago) and read 2072 times:

On the second of July Goldman Sachs issued a "sell" recommendation for Austrian Airlines with a target -price of 2.4 €...
Today the share-price approaches the 7 € mark,and will most likely hit 8 € within two days.
Just how criminal are these Investmenhouse-gangsters issuing recommendations under their image of "respectability.."
It proves once more-just do exactly the opposite of ANY Goldman reco...


Please respect animals - don't eat them...
6 replies: All unread, jump to last
 
User currently offlineGlobeEx From Germany, joined Aug 2007, 742 posts, RR: 5
Reply 1, posted (6 years 3 months 3 weeks 7 hours ago) and read 1987 times:

Quoting Beaucaire (Thread starter):
On the second of July Goldman Sachs issued a "sell" recommendation for Austrian Airlines with a target -price of 2.4 €...
Today the share-price approaches the 7 € mark,and will most likely hit 8 € within two days.
Just how criminal are these Investmenhouse-gangsters issuing recommendations under their image of "respectability.."
It proves once more-just do exactly the opposite of ANY Goldman reco...

Well it was the value, where Goldman Sachs Analysists thought it is worth. I mean, lets be honest , the current share-price is far higher than OS real value due to speculations of a takeover.

Looking at the market capitalisation of OS that would be 200m€. Looking at the fact that OS has 800m€ in debs (is that right?) one would pay 1 billion for OS. Comparing it with LH for example. The marketcapitalisation of LH is about 10 billion. Looking at how well LH is run, its size, etc. 1/10 of LH's price seems fair to me.


GlobeEx

[Edited 2008-09-02 09:35:04]


As you may presently yourself be fully made aware of, my grammar sucks.
User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 25
Reply 2, posted (6 years 3 months 3 weeks 7 hours ago) and read 1956 times:

You don't just drop share-recommendations for the next week but rather for a forseeable timeframe of at least 3-6 months..
Goldman should have had enough inside knowledge about the potential of the airline ,considering their Eastern-European network.Any airline stock increases in value once take-overs are on the horizon.
Nobody is expecting miracles from financial analyst's ,but reasonably researched data and projections based on that analysis. Any parrot with a multiple choice valuecard-selection could have done better..



Please respect animals - don't eat them...
User currently offlineGlobeEx From Germany, joined Aug 2007, 742 posts, RR: 5
Reply 3, posted (6 years 3 months 3 weeks 7 hours ago) and read 1949 times:



Quoting Beaucaire (Reply 2):
You don't just drop share-recommendations for the next week but rather for a forseeable timeframe of at least 3-6 months..
Goldman should have had enough inside knowledge about the potential of the airline ,considering their Eastern-European network.Any airline stock increases in value once take-overs are on the horizon.
Nobody is expecting miracles from financial analyst's ,but reasonably researched data and projections based on that analysis. Any parrot with a multiple choice valuecard-selection could have done better..

It is and was what GS thought OS is worth. And I think probably they still would say that OS is not worth more than 3€ per share despite the fact that it stands somewhere else now.

Read what I edited in the post above. I think 1/10 of LH's price is fair, comparing both businesses.



GlobeEx



As you may presently yourself be fully made aware of, my grammar sucks.
User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 25
Reply 4, posted (6 years 3 months 3 weeks 7 hours ago) and read 1931 times:

I'm not so sure that any potential buyer will inherit the complete debt of OS....
There is talk that the company might be sold with a reduced debt structure like the AZ scenario...
Furthermore LH has big problems with Russia's AirUnion (LH partner) ,who are close to broke...OS have slots into Russia ,India and Tokyo -precious assets that are worth quite some money.That makes OS quite attractive to them and a premium over the current share-price is just what the market allows.



Please respect animals - don't eat them...
User currently offlineGlobeEx From Germany, joined Aug 2007, 742 posts, RR: 5
Reply 5, posted (6 years 3 months 3 weeks 6 hours ago) and read 1910 times:



Quoting Beaucaire (Reply 4):
I'm not so sure that any potential buyer will inherit the complete debt of OS....
There is talk that the company might be sold with a reduced debt structure like the AZ scenario...

Well let see how that works out with EU legislations. AND I'm sure GS didn't take that into account.

Quoting Beaucaire (Reply 4):
.OS have slots into Russia ,India and Tokyo -precious assets that are worth quite some money.That makes OS quite attractive to them and a premium over the current share-price is just what the market allows.

Well If you go after this and look at what some US carriers paid for LHR slots, lets talk about the worth of LH as third biggest Operator out of LHR, or about the price of BD. Don't think any of OS slots you name come close. The only one which could be taken into account here might be NRT slots. And lets face it, OS l/h network isn't even profitable.
Fact is, that a takeover of OS will include big risks in todays airlineenvironment. Those factors are also part of the share-price.
Lets face it, if the new owner will inherit the debts he will pay close to 1 billion directly and indirectly which is more than enough.


GlobeEx



As you may presently yourself be fully made aware of, my grammar sucks.
User currently offlineGlacote From France, joined Jun 2005, 409 posts, RR: 2
Reply 6, posted (6 years 3 months 3 weeks 2 hours ago) and read 1763 times:

With respect Beaucaire your criticism is ill-advised in this case. Analysts recommendations are known to be "normal path" expectations and to exclude tail events. Computing an "average" with fare-reaching outliers (what if scenarios: currency devaluation, hurricane, take-overs etc.) just adds noise. Unless they are explicitely mentioned as being the main driver of the forecast, they better be disregarded. Otherwise no fair comparison can be done across companies. Besides, how do you come up with a hard number for the probability that say Austrian gets taken over? And how to guesstimate the offer price? That's not accountability, that's not even science, that's astrology.

Sure enough the analyst ought to have known that a take-over was possible/likely - and mentioned such. Btw I would bet he did - did you check?

Point being, if it were not for such tail events (unlikely, but wildly different) then people would already be implementing blind strategies and make money. That they do not just tells us that, well, there exists unlikely yet large deviations around any sensible forecast. That does not make such forecast any less correct/useful.

Anyway if you want to play your "contra-GS" strategy, more power to you, but I doubt that's a money-maker, even with your insider knowledge.

Best...


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