What drives Air Canada's stock price?
Apr 21, 2020, 12:23 pm
#436
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Even if you're correct that the government won't let AC fail, which is probably correct, that doesn't mean shareholders won't be wiped out or massively diluted. Remember that GM and Chrysler didn't fail, but their shareholders were wiped out.
(I'm not saying AC is going to zero, just want to make sure people keep it in mind that a bailout of the company doesn't necessarily mean a bailout of the shareholders)
(I'm not saying AC is going to zero, just want to make sure people keep it in mind that a bailout of the company doesn't necessarily mean a bailout of the shareholders)
Apr 21, 2020, 1:27 pm
#437
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United released its first quarter earnings. Not Pretty. Delta will release information next week.
I expect the only reason AC stock price is high is investors assume the Canadian Govt will give AC billions. Without an expectation of Govt Money AC stock would be a lot lower.
I expect the only reason AC stock price is high is investors assume the Canadian Govt will give AC billions. Without an expectation of Govt Money AC stock would be a lot lower.
Apr 21, 2020, 3:31 pm
#438
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For sreholders, counting on a govt bailout is a huge exercise in wishful thinking. Which is probably a strong rationale for AC to try to survive witought a bailout, assuming they can.
Apr 21, 2020, 3:40 pm
#439
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Apr 21, 2020, 3:55 pm
#440
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Not sure what you mean. Chrysler was sub-scale, GM had the headache of Opel, both had worried investors with debt loads and high labour costs (including pensions/post-retirement benefits) for long before the global financial crisis pushed them over the edge. AC, on the other hand, has had sustainable labour costs and been generating consistently high profits for a while.
Apr 21, 2020, 5:06 pm
#441
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Not sure what you mean. Chrysler was sub-scale, GM had the headache of Opel, both had worried investors with debt loads and high labour costs (including pensions/post-retirement benefits) for long before the global financial crisis pushed them over the edge. AC, on the other hand, has had sustainable labour costs and been generating consistently high profits for a while.
I read as on fire preparing for a fire sale.
Apr 21, 2020, 5:08 pm
#442
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Apr 21, 2020, 5:40 pm
#444
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Historically, airlines have not been good investments. There is a long list of airlines in Canada that have gone bankrupt. Sure, there have been exceptions in specific time periods, but compared to many other industries you could make more money with less risk elsewhere. Airlines really only seem sustainable in a low interest rate and low fuel price environment.
My other rule is don't invest money you can't afford to lose. If the stock I have bought goes to zero and that means I won't be able to buy groceries next month, I should not be buying the stock.
My other rule is don't invest money you can't afford to lose. If the stock I have bought goes to zero and that means I won't be able to buy groceries next month, I should not be buying the stock.
Apr 22, 2020, 10:18 am
#445
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Historically, airlines have not been good investments. There is a long list of airlines in Canada that have gone bankrupt. Sure, there have been exceptions in specific time periods, but compared to many other industries you could make more money with less risk elsewhere. Airlines really only seem sustainable in a low interest rate and low fuel price environment.
My other rule is don't invest money you can't afford to lose. If the stock I have bought goes to zero and that means I won't be able to buy groceries next month, I should not be buying the stock.
My other rule is don't invest money you can't afford to lose. If the stock I have bought goes to zero and that means I won't be able to buy groceries next month, I should not be buying the stock.
Apr 22, 2020, 10:47 am
#446
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Thanks for the feedback and to the others as well. I honestly thought AC stock would go lower similar to the cruise lines, the fact that it has not seems to indicate institutional confidence that they will recover. I would not invest money unless I could afford to lose it for this kind of investment. I have modest goals - if $5K gives me $10K in three years, I would be happy.
Apr 22, 2020, 10:52 am
#447
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Thanks for the feedback and to the others as well. I honestly thought AC stock would go lower similar to the cruise lines, the fact that it has not seems to indicate institutional confidence that they will recover. I would not invest money unless I could afford to lose it for this kind of investment. I have modest goals - if $5K gives me $10K in three years, I would be happy.
Apr 22, 2020, 11:00 am
#448
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When has AC dipped in to pension funds? That's not how it works. If a plan is sufficiently overfunded, a company can reduce or eliminate the amount it has to put in, but it's not allowed to simply take money out and do whatever it wants with it.
Doubling an investment in three years (>25% annual rate of return) is not a modest goal
Doubling an investment in three years (>25% annual rate of return) is not a modest goal
Apr 22, 2020, 12:04 pm
#449
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I was talking about the US automobile industry... I suppose the context was not 100% clear.
Apr 22, 2020, 12:30 pm
#450
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Thanks for the feedback and to the others as well. I honestly thought AC stock would go lower similar to the cruise lines, the fact that it has not seems to indicate institutional confidence that they will recover. I would not invest money unless I could afford to lose it for this kind of investment. I have modest goals - if $5K gives me $10K in three years, I would be happy.
I have speculative goals- if 5K gives me 10K at some point in the next three years (possibly tomorrow with some bailout announcement), I would be happy.