In other words, your rant could be summed up: "Get off my lawn, whippersnappers!"
I'm one of the AAMRQ investors. Yes, it was a bit of a gamble, but I had a strong gut feeling that I would really regret it if I didn't invest at just over $7. I figured that over a 6 month period, I might make 50%. I think it's going to be closer to double.
Yes, I have sold my first distribution. I still think American will go up a decent amount over the next year or two. I sold the first distribution worth in order to diversify my investments again.
However, I took the second distribution and bought January 2016 $25 AAL call options with it. I will probably sell the third and fourth distributions to diversify further.
A couple of the American related news articles that I noticed this week were:
A) American Eagle is going to be wound down & eventually liquidated
B) gate swap to get more international access
Anyone have thoughts on how either of these will affect the company over the long haul?
No, I don't think so. This will allow me to pay for some vehicle repairs, take a family vacation, and diversify my investments a little at the same time. Keep in mind that 3 of the 4 distributions are still coming. Because of that, those would still participate in any share price increase. If the stock dips a little, I may also put a bit back into LEAPS, since obviously I still think this will go up into the 40's eventually.
Looks like I bought it around Halloween, when American was about $7.35 a share. About 2/3 of our shares are in Roth IRA's, so the taxes aren't as important for us. Each $100 I invested turned into about $290, if I am figuring it right. (adding a bit for the options)
I decided to sell my first AAMRQ distribution (~25% of eventual total) today at $34, so technically I guess I don't own any AAL stock at the moment. (I had also placed a portion of it into $20 Jan 2016 call options, which appreciated a nice 71%, from 880 to 1510 over the past 7 weeks) I did it for 3 reasons:
1) There seems to be a lot of gloom and doom resurfacing in the market lately, and I think it could spread to AAL as well, since it will be a while before the next earnings report. Originally I had thought about selling some at $28, then $30, then $32. At $34, I finally decided to lock in some profits on a portion.
2) I had roughly 94% of our $$ invested in AAL, and decided it was time to re-diversify. I think we'll also take a nice vacation somewhere.
3) There are still the future AAMRQ distributions, around 75% of the stock, which will participate if the stock continues to go up.
I guess the question is whether AA has already purchased long term contracts, or if they foresaw that prices might decrease significantly, and held off for lower prices before doing so. Does anyone know?
* is the info below good news for AAL (should it drive the price up), or is the info already priced in? I'm wondering how much of an affect this might have on the stock price. Does the company have any way to lock in this low price in the form of lower priced jet fuel?
NEW YORK (Reuters) - Long-term U.S. oil prices have slumped to record discounts versus Europe's benchmark Brent, with some contracts dropping below $80 in a dramatic downturn that may intensify producers' calls to ease a crude export ban.
Oil for delivery in December 2016 has tumbled $3.50 a barrel in the first two weeks of the year, trading at just $79.45 on Friday afternoon, its lowest price since 2009. That is an unusually abrupt move for longer-dated contracts that are typically much less volatile than prompt crude. For most of last year, the contract traded in a narrow range on either side of $84 a barrel.
Here's the reply I got:
We sold the slots through a bidding process, as part of our negotiated settlement with the DOJ.
So I guess there's a tenth of a Billion or so to add to first quarter earnings.
I have emailed investor relations to try to get a clarification on this: whether they were paid for the slots they had to give up, or not. Since there was bidding going on, I'm assuming that someone got paid. Going by past payments for slot pairs, I would think that the slots given up were worth around $100 million. Anyone else have thoughts on the value of the slots that were divested?
I think this is a valid question, and I'll admit I don't completely understand it myself. I have read articles that said that American had to "give up" the slots in order to exit bankruptcy. However, I have read other more recent articles saying that various airlines were "bidding" on the slots. If they were bidding, then it would seem that they were offering money for the slots. If that is the case, then I think it is reasonable to ask where that money went - does it go to American Airlines, or does it go to the airport hub?
That's a good question. I'm wondering - do they still have 10 billion in cash, after spending over 2 billion on merger costs over the past months?
Also, why in the world does Yahoo show a NEGATIVE $23 book value for this stock? Are they saying that presently, the company actually has a negative value per share?
Couldn't they spend 15% of their cash hoard for something like a 25% minority stake in Alaska Air? Yes, I'm fairly new to AAL - I've only been paying attention for about 3 months, and my AAMRQ is slowly converting. However, I thought that a company could take a minority stake in a regional carrier without the Dept. of Justice getting involved, so long as it isn't a controlling interest. (is that incorrect?) I thought that it was purchasing all of a company, or at least a controlling interest that brought intense regulatory scrutiny.
I don't think that American is currently interested in another merger, though they might have the experience and cash hoard to pull a smaller one like this off. However, the present political climate would not be conducive - right now. That's not to say they couldn't lay the groundwork for one that might happen a few years down the road. It might not be such a bad way to pull the two companies closer together, deny Delta a profitable expansion, and get an additional revenue stream for AAL stockholders.
I just read an article on TheStreet where it says:
"Something is potentially going on between Alaska (ALK_) and American Airlines (AAL_) but Alaska executives won't say exactly what it is."
"the two airlines are talking, which isn't surprising given that Delta (DAL_) is engaged in an effort to bulk up its flying into Alaska's Seattle hub and plans to compete with Alaska on a variety of key domestic routes. "
"We're getting to know the new American management team," Harrison said during the call. "I have met with their alliances folks, and we have started discussions about how we might work with the new American."
It's kind of interesting reading between the lines in the article, and it really makes it sound like the two are getting rather cozy.
What do you think, is this just two companies deciding to cooperate to try to "screw" Delta, or is something more going on here?
Interesting article at "The Street", which says considering that other airlines are paying a dividend or have announced one, that 2017 is too late for them to begin paying a dividend, while 2015 is likely too soon. Therefore, evidently they believe that American will begin paying a dividend on shares by 2016.
According to investor relations, tentatively on Jan. 28.
If you have a question like this in the future, go up to where it says "search message boards", then enter something like "earnings date", and you can see the relevant posts.
I've owned in my retirement account since the shares were $13. Yes, I bought back when I thought the dividend was backed by the government, and that they would not let the dividend disappear. I was convinced that it was a "safe" investment in troubled times. I've held on hoping that they would eventually pay off all of the debt, and the dividend would reappear - hopefully sending the preferred stock back to $25.
Hmm. I can see both sides of this. I would probably be annoyed if I had been on this board, and suddenly lots of aamrq stock folks got on here and started spouting stuff over and over about the conversion. There are a lot of folks on here that will not be affected by this conversion at all, other than to constantly get on here and feel annoyed because it looks like their hangout has been taken over - often by uninformed folks who often have no long term interest in the company. Of course, from the other side of things, those with significant involvement in AAMRQ may not fully internalize how this conversion is going to work until they have had a couple of distributions a month from now. To them, the # of shares they get is paramount, and they may be worried that they are going to somehow get "gypped", or something along those lines. I am in the latter group, having invested quite a bit of various funds (our car fund, mission fund, etc.) into AAMRQ. I'm very happy with how it seems to be turning out. My gut feeling is that I should hold on to this for a while. However, if it gets up over ~$32 a share or so, I may be tempted to sell some of this.
I realize that it would be tempting to sell right away, since this has gone up a decent amount. However, if it goes up another $10 in the next 5 months, will you still be happy you sold now? This isn't as impossible as it might seem - consider that it has gone up about $5 in just a month or so.
For the most part, I consider selling now to be "losing money", not making it. In fact, I invested my initial distribution into $20 Jan. 16 LEAP calls - now up 27%.