May 10 — Isn’t it remarkable how, after all this time, and all these losses, and all the pain and suffering undergone by all those many investors in the IPO bubble of the 1990s, one can still find among us, in this hour of our misery, enough chumps willing to give it one last Hail Mary try, so that we may still behold situations like the one that has now developed in JetBlue Airways?
WELL, WHAT ELSE CAN you say when a company with a grand total of 24 aircraft and an 8 percent operating margin, should be priced at roughly one-sixth the market value of the most overvalued air carrier in the business, Southwest Airlines Co., which nonetheless has 15 times as many airplanes, 17 times as much revenue, 23 times the profits, and a much better operating margin?
Put slightly differently, is a dollar of next year’s earnings by JetBlue really worth somewhere around 33 percent more, give-or-take, than a dollar of next year’s earnings from from Southwest — especially when the analysts’ community on Wall Street (if you’ll pardon the expression) thinks Southwest will actually be growing at a faster clip?
Link to complete article....
http://www.msnbc.com/news/750329.asp