analysts generally express widespread pessimism , but a few see a 50-50 possibility of approval , subject to certain stipulations....Fortunately , USAIR can live without it , especially considering the bloated price and predictable labor strife that portends to be involved.
I hadn't considered these facilities but I suspect LCC still sees growth under these conditions otherwise the deal couldn't be reached.
Interesting gain will be the dollar value placed on these gates and facilities.
I would expect further profit growth as these sales are added to the balance sheet.
10X p/e ? excuse me! 8X p/e?
The stock action is early but this still is a value pricing for trading.
LCC + AAMRQ merger creates the largest airline in the world with enough slots at major airports to continue massive earnings.
....that must be worth a lot more than LCC is worth now........ think about it.... $40-50 in 1-2 yrs or before would be kinda cheap for that senario
I'll go out on a limb - odds on merger happening 90%. Really doesn't matter as the stock was way oversold in 15's, and the stand alone company or merged company (as I and others have pointed out) is worth more than where it is right now. Will just keep selling calls 4-6 months out on it in the 20's when appropriate - buying them back on sell offs - rinse and repeat. At this point just a cash cow with no cost basis in core account and a 15.54 cost basis in trading account. This is a swing trade banking on the merger going through via the courts or pre-trial settlement.
I don't put all of my decision factors into experts but I would also think about the possibility of the DOJ making a deal with LCC by having them give up gates or facilities at airports to allow other airlines access. It doesn't even guarantee that other airlines would move in! I think the chance of a deal may be very high....
There is plenty of competition in the DC area. There are three different airports and all three would be have different carriers as the leading airline. In fact, at DCA, they would control a lower percentage of flights than United does at IAD and possibly less than LUV at BWI.