Wow... What a nice discussion. Not like the years prior... how remarkable.
Edsha and Stin and AirL - we've all been in Fly for a few years.
I continue to hold a position but will not add to it.
Management has lost its mojo and while there is certainly value in the planes and relationships, I don't see them knowing how to monetize it. Very disappointed overall and yes they are the runts of the liter now.. and there is likely less food for them to make it on their own longer term. I would expect some continued consolidation in the business amongst the largest competitors and frankly haven't sold because I do expect Fly to be taken out.
The urge to merge. There is no longer term reason for them to go in circles ... chasing their tail...
I think it had a lot to do with their focus on reducing average fleet age on the call. That's been a concern and they appear to be addressing it head-on. That and the comments on increasing average lease rates, 100% fleet utilization, $400M of unrestricted cash with intent to use it to grow, lower operational costs, lower interest rates, leverage ratio currently at
Listening to the CC, they clearly stated that $600 million was already allotted to the purchase of 15 planes, the sale of which was already 'in the pipeline.' and that they could purchase more than that were opportunities to arise. Also hinted that they would be purchase from other lessors (I read AER), which might explain why acquisitions can be in the pipeline yet not announced. Also that opportunities to buy planes were not there in 2013 (maybe they anticipated picking up a chunk of ILFC). I've never seen such a revealing CC. The stock began to tank after the numbers were posted, but turned around only AFTER the CC. And today's volume was so decisive that I would be surprised if this were only a one day rally.
Another point: Air leasing is now clearly in vogue, and while AER and to a lesser extent AYR have already racked up gains, FLY has not . (Looking for runts in hot sectors is one indicia of the end of a Bull Market.) Based upon the CC, I have become less pessimistic. The golden ring (when I would unload) might be if and when a sale from AER is announced (after the formal acquisition of ILFC) .
Yes, I read between a number of lines in the transcript that seemed to possibly allude to an AER transaction. I might play it with options around the time AER closes - still dont like management so wouldn't buy any outright here myself.
Reconfirmed they will grow assets at least 15% and their financing cost went down on a better credit position. They believe the industry is more liquid overall helping everyone to buy and sell assets and get good financing. Have 10 deals in the works. all planes flying by end of month. I will take the dividend an some growth per year. This is a business with highly fungible assets with accurately measurable value