ALK's metrics are not very attractive when closely examined
First, ALK sells at a very expensive 1.93x book value vs a very undervalued .85x for JBLU (Yahoo consensus data). Secondly, analysts have a 5.2% estimated revenue growth rate for ALK for next year vs a 7.6% estimate for JBLU (Yahoo consensus data). Most importantly, JBLU's call/put ratio is extremely bullish in comparison to ALK. For example, JBLU's Aug 6 calls outnumber puts 4:1; JBLU's Sept 6 calls outnumber puts 28:1 and JBLU's Dec 6 calls outnumber puts 102:1. In summary, based on valuation, revenue growth and call/put activity, JBLU-without question-is a far more attractive acquisition candidate than ALK. What is JBLU worth in a year-end buyout by AMR ? AT LEAST...1.5x book value or $9.50/sh. Good luck to all.
I say there will be no more acquisitions in the airline industry, other than US Air and American, for at least five years. It will take that long for the airlines to absorb the current mergers. In fact, we may never see another merger, which means Alaska, Jet Blue and the others will need to make it on their own in the market place.