AC's management/executive team has been very good in talking up their prowess at improving the numbers and this in turn has hyped to stock to rather spectacular levels (going from just over $1 to just under $10) over the course of a year or so. The media is gullible and the Market moves accordingly. Where management has been very good is maximizing revenue vs seat availability and reducing costs to maximize margins. This is in no small part due to reducing its purchase of AE miles on low fares, and adding surcharges everywhere these can be rationalized. With a recovering consumer, and a docile competitor who is also out to maximize margins, AC has been able to generate profits to cover the arrears of its pension plan (and internally generated better ROIs to lower the shortfall). With the PP liability cleared, it can now boast of generating real profits and thus become a stable and attractive long term investment.

Of course, valuing anything based on its MarketCap is a questionable act at best, given how fickle and unreliable the stock markets can be. At the moment UBER is valued more highly by The Market than any airline which actually has assets and operates a real business. And we all remember how AOL became larger than TimeWarner, thus enabling this guppy to swallow that media whale.

Let's just say in this regard, AC's team has transformed the airline into a relatively stable operation with a credible face in the Market. As I posted the other day, I don't see the stock rising above $10 for any sustained period of time and it is more likely to be "normal' in the $8-$9 range...which ironically is where the stock was when the original company's stock was first issued back in the 1980s and where it languished until the CP/AC/ONEX take-over battle of 1999/2000. (Yes, these are actual constant dollars, not adjusted for anything.)