FlyerTalk Forums - View Single Post - G&M Investor: Is it the right time to take a flyer on Aeroplan?

Jun 10, 2009 | 6:06 am

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tcook052

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G&M Investor: Is it the right time to take a flyer on Aeroplan?

http://www.theglobeandmail.com/globe...rticle1175994/

Groupe Aeroplan (AER-T7.550.375.15%)has always been a great franchise - except for one problem: It's tied to Air Canada at the hip.

There was a time when that wasn't such a problem, when the parent company owned a piece of both. But times have changed, so when it looked like Air Canada might crash land in bankruptcy court, Aeroplan shares took it on the chin because the contract might have been renegotiated on adverse terms for Aeroplan.

Now that the airline has bought a reprieve by negotiating with its unions, Aeroplan is regaining altitude. Should you get on board when seats are cheap? The stock (Aeroplan used to be a trust but converted to a corporation) looks cheap at six or seven times forward earnings, depending on which analyst you ask.

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