LRGT
Posts: 675
Joined: Thu Jul 22, 2004 12:29 pm

Good Airline Stocks?

Sun Jan 16, 2005 1:41 pm

Airlines are all reporting their 4th quarter profits in about a week and wonder if now may be a good time to buy their stocks since it seems like the 4th quarter may bring better-than-expected earnings.

Does anyone know how traffic and yields were at FL (Airtran) and F9 (Frontier)?

How about Gol (Brazil)?
Don't bring up the NW DC9's unless you have to!
 
hawk44
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RE: Good Airline Stocks?

Sun Jan 16, 2005 1:44 pm

Airline stocks are not good stocks to buy it's that simple. If you had to buy a stock in an airline I would say either WN or B6. You can go to bloomberg.com and look up their quote and find their yield. Plus no airline stock is going to pay dividens if they do they are not going to be much.

Hawk44
Never under estimate the power of US
 
NWAFA
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RE: Good Airline Stocks?

Sun Jan 16, 2005 1:48 pm

The ONLY stock I would even consider these days would be WN. JetBlue stock had not been doing well. Forget about the Majors right now. Frontier, has some "thinking" to do right now. AirTran, maybe...but WN truly is the only sure thing...
THANK YOU FOR FLYING NORTHWEST AIRLINES, WE TRULY APPRECIATE YOUR BUSINESS!
 
luv2fly
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RE: Good Airline Stocks?

Sun Jan 16, 2005 1:51 pm

WN pays a dividend though it is not a whole lot to speak of, I do appreciate getting my pay put though. Also Warren Buffet the investment genius has an expression you should take to heart! And I am not sure I am quoting it 100%, "To make a million in the airline industry you only need to start with a billion!"
You can cut the irony with a knife
 
srbmod
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Joined: Tue Mar 20, 2001 1:32 pm

RE: Good Airline Stocks?

Sun Jan 16, 2005 1:57 pm

You're better off not investing in airline stocks. The only airline I would even consider buying stock in is Southwest (LUV), and the entire thing with ATA has me hesistant. JetBlue (JBLU) is finally seeing the shine it had since it's IPO losing its' luster; Ryanair (RYAAY) has been a solid performer, and would be a second choice for any airline investment. AirTran (AAI) has been underperforming for a while, but it would be a good stock to have bought 18-24 months ago, back when it was trading in the $2-$3 range. Frontier (FRNT) has been trading well below the highs it had 5 years ago, when it was trading in the $30s right before the split in March of 2001 (when the stock was trading in the low $20s).
 
LRGT
Posts: 675
Joined: Thu Jul 22, 2004 12:29 pm

RE: Good Airline Stocks?

Sun Jan 16, 2005 1:57 pm

BUT...WN's stock is quite overvalied and everyone already expects them to post a profit for the 4th quarter.

Could someone (like Airtran) surprise with better earnings than analysts are EXPECTING???
Don't bring up the NW DC9's unless you have to!
 
hawk44
Posts: 733
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RE: Good Airline Stocks?

Sun Jan 16, 2005 1:59 pm

I just looked and WN or LUV does indeed pay a dividend of 0.018  Laugh out loud

Also Im thinking of buying a few shares of some airline stock just to say I have their stock but if you want to make money with airline stock as someone posted before it's going to be very difficult.
Never under estimate the power of US
 
ACAfan
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RE: Good Airline Stocks?

Sun Jan 16, 2005 11:12 pm

"People who invest in aviation are the biggest suckers in the world."

— David G. Neeleman, after raising a record $128 million to start New Air (the then working name for what became jetBlue Airways), quoted in 'Business Week,' 3 May 1999.

http://www.skygod.com/quotes/airline.html
Freddie Laker ... May be at peace with his maker ... But he is a persona non grata ... with IATA
 
FlyMeToTheMoon
Posts: 189
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RE: Good Airline Stocks?

Sun Jan 16, 2005 11:35 pm

Unfortunately there are no good airline stocks. Airlines are amazing at destroying wealth. You can become a millionare by investing in aviation. You know how? You take a billion and invest it in an airline and shortly thereafter you have a million. Anyway, the sad fact is that US airlines had a negative rate of return from 1932 until today. In other words, they made no money for their stockholders, in the long run that is. The best thing to do is to buy 1 share, have the company send you the paper stock certificate and then frame it - sooner or later it will become an artifact for a defunct airline.
Fly me to the moon... but not through LHR!
 
isitsafenow
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RE: Good Airline Stocks?

Sun Jan 16, 2005 11:36 pm

At this time, airline stocks are a poor risk. I unloaded mine in time and made a little. Bought a new Mustang(2005) but that pretty well took care of that.
It really wasn't a lot of money. Try the airline stocks again in about 18 months. There should be a number of good ones by then. Right now the returns are slim and none.
safe
If two people agree on EVERYTHING, then one isn't necessary.
 
gothamspotter
Posts: 311
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RE: Good Airline Stocks?

Mon Jan 17, 2005 12:02 am

In Jim Cramer's (Kudlow & Cramer) top 10 predictions for 2005, he's wagering that all of the legacy carriers will be forced to fold as a result of the continuing rise of fuel costs and their anemic cash balances. This seems a bit extreme, but who knows. If the legacies stick around and fuel prices continue to rise, neither they nor the LCC's are going to have a great year. If they start folding, the LCC's will have a better year because of increased demand for their seats, but yields would still be low due to the high cost of fuel.
 
srbmod
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RE: Good Airline Stocks?

Mon Jan 17, 2005 1:45 am

If you want to take a gamble (pun alert) with a stock, go with gaming stocks. Airline stocks are still going to be suffering as long as the oil prices stay high and the fares stay low. Casino stocks have been on a rise over the last year, and coupled with the mega-mergers of MGM-Mirage and Mandalay Bay Group and Harrah's and Caesar's Entertainment, a lot of the stocks in the sector are performing very well, even the smaller gaming companies are seeing growth as the number of visitors to Vegas are returning back to the pre-9/11 numbers. And how does this tie in with airline stocks? How do the majority of people get to Vegas? They fly there. The casinos and the airlines are dependent on one another. Look at who were the primary investors in N7? The casino industry. The downturn of airline pax after 9/11 effected the casino industry about as badly as it did the airlines, and with the travel to Vegas back up, the airlines are seeing full flights to LAS again; unfortunately, LAS is a low-yield route, so most of the airlines are barely making any money (if any) off of LAS flights.
 
UA_727
Posts: 155
Joined: Sun Aug 19, 2001 7:53 am

RE: Good Airline Stocks?

Mon Jan 17, 2005 2:21 am

I just did a meticulous empirical analysis on CO's stock - ouch! When considering historical prices and using the security market line formula, CO's stock is clearly overvalued - a definite "no-go". Also, it doesn't even take much analysis and use of formulas to realize how risky CO's, and other airlines' stock is. Check out CO's beta on Yahoo Finance - it is nearly 3.4!! Not the area in which I would choose as my foci for investments. Interesting to me, however, has been independence air (couldn't remember their symbol, is it ACA?). I considered potential investment here (as far as airlines go, anyway), yet because the company hasn't been in existence for too long (as an 'independent', that is), it is difficult to ascertain its potential and to find an accurate required rate of return. It will be interesting to see what happens when the 320's start coming and the new routes out west begin.

-just some thoughts  Big grin

-UA-
"AW - I'm on Board..."
 
LRGT
Posts: 675
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RE: Good Airline Stocks?

Mon Jan 17, 2005 3:16 am

FlyI will be gone before US Air!

If they want to enter the market in this time, they should have choose to fly to the Caribbean with their regional jets and to Hawaii with their A320's!...NOT the over-saturated and under-priced transcons and to Florida via IAD.
Don't bring up the NW DC9's unless you have to!
 
komododx
Posts: 1734
Joined: Tue Jan 27, 2004 4:40 am

RE: Good Airline Stocks?

Mon Jan 17, 2005 3:19 am

I recommend:

1. LFL (LAN Airlines)
2. SKYW (Sky West)

I'm homeless and unemployed
 
EMBQA
Posts: 7797
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RE: Good Airline Stocks?

Mon Jan 17, 2005 5:33 am

"If you want to make a Million dollars investing in airlines, start with a Billion"
-Warren Buffett

Southwest is the most solid of the airlines, but its no 'barn burner'. They do not pay out dividends as they reinvest all their earnings back into the airline. There price also rarely swings morw then a few dollars from where it is right now. If you want to invest some into a company, invest into one that pays dividends....which NO airline in the US does. The compnies I own all PAY ME to own their stock... the more I own, the more they pay me...plus the stocks all are solids and slowly going up in value. Its a win-win
"It's not the size of the dog in the fight, but the size of the fight in the dog"
 
Airline7322
Posts: 104
Joined: Wed Sep 01, 2004 8:42 am

RE: Good Airline Stocks?

Mon Jan 17, 2005 5:37 am

Although Embraer is not an airline, they are an excellent company to buy stock in. Their stock value is expected to double in a few years, and their new EMB 170/190 family is doing quite well.
"Good ideas must be driven into practice with courageous patience."
 
Midway2AirTran
Posts: 847
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RE: Good Airline Stocks?

Mon Jan 17, 2005 12:13 pm

Gee, from responses here it appears that the analyists are doing their job well with their "the sky is falling" comments. If you are considering buying airline stocks I would suggest you investigate the financial statements on your own and see the true stories really going on. I have found some interesting stuff doing that myself.

The industry is a very complicated one with many varibles and it is too easy to get caught up in the clutter; sometimes it seems that the execs do too! When it comes to investing, it comes to what's in the financials, not ASM's, RPM's, loadfactors etc. or even LCC competition, there are some strong carriers out there that will suprise you if you listen to the outside news.

Just go to the airlines' website and check out the investors page where there is normally an annual report you can check out online, some may still send you one in the mail. If you don't understand what you are reading, then you should learn or try your luck in Vegas! Or you can flock with the other idiots who listen to those so called "experts" and chatter. Good luck  Big grin
"Life is short, but your delay in ATL is not."
 
LRGT
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RE: Good Airline Stocks?

Tue Jan 18, 2005 11:26 am

I guess out of the discounts, Airtran would be the best value. Do you think they will meet estimates for the 4th quarter????

Regarding the legacies...which one will be the first to post a profit again? Continental? Northwest?
Don't bring up the NW DC9's unless you have to!
 
hawk44
Posts: 733
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RE: Good Airline Stocks?

Tue Jan 18, 2005 11:39 am

Ok I don't know what's so hard about this as said before airline stocks are not good stocks no matter the airline. Why don't you go to their website and look at their annual report if still not satisfied go to a broker so he can explain how not to get involved with airline stocks. No offense but the stock market is not for everybody and that's what a broker can help you with. Let's say you buy as much airtran stock as you want and god forbid we have a 9/11 type attack involving them or they have a crash or something like that all your money will be gone when the stock sinks faster than the titanic.
Never under estimate the power of US
 
roseflyer
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RE: Good Airline Stocks?

Tue Jan 18, 2005 11:53 am

Airline stocks are incredibly risky, but that does not mean that they are horrible stocks. AA went up over 500% in less than a year, and DL jumped drastically as well when it avoided bankruptcy. You can make a huge amount of money on investing in airlines since they are so fickle, but if you are feeling like gambling money that you don't mind losing, then you really can gain a lot. Investing in an airline that is on the verge of bankruptcy with a stock trading under 3$ could pay huge yields if the airline avoids bankruptcy.

WN stock is not overvalued at all. It has been trading at 15$ a share recently, which is extremely low for a company that has posted a profit for such a long time. The rest of the industry is bringing it down. I am not saying that it is undervalued and should be a buy, but it is a strong stock. If you don't mind losing, then transportation in general can pay out well. I bough Carnival Cruise Line stock and it has more than doubled in 2 years. Luxury item stocks (airlines included) can be a good buy in times like this, because if the company is well managed, then it has a lot of potential as the economy picks up. Luxury item stocks are always far riskier, and should be left to the young and stupid investors, but they can give large yields. I personally have invested in the industry, but it is because I am still young, and can take the risk. Be careful with your money!
If you have never designed an airplane part before, let the real designers do the work!
 
airgeek12
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RE: Good Airline Stocks?

Tue Jan 18, 2005 11:56 am

definitly none of the US airlines would be good investments
 
EMBQA
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RE: Good Airline Stocks?

Tue Jan 18, 2005 12:02 pm

WN stock is not overvalued at all. It has been trading at 15$ a share recently

....and that is about all you get out of it. It's all time high is only around $30. A good solid performer, but nothing to write home about. The time to have bought is well past....early 1990 you would have cashed in.

[Edited 2005-01-18 04:06:22]
"It's not the size of the dog in the fight, but the size of the fight in the dog"
 
Airlinerfreak
Posts: 1246
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RE: Good Airline Stocks?

Tue Jan 18, 2005 12:12 pm

No airline stock is really a good buy. It is a big gamble to buy into airlines, as today they are fin tomorrow, who knows what will happen. Investing in the stock market is a big damble but investing in the airlines is even bigger. The Airlines are just too unstable right now so I just reccomend putting your money in Bonds or another stock. Even thought Warren Buffet said believe in your heart, this is a case where you shouldnt.