Thanks, fly. I'll try to figure out the other questions so I can get a feel for DAL's profits going forward. It almost sounds like the PS could have a perpetual fuel hedge (2015's) impact.
Obviously, the PS is an eye catcher, but it is only part of the big picture. I would be interesting to get a comparison of contract costs across companies. PS is a plus, but are there work rule cost differences that offset? Not saying there are. I guess one would have to be on a negotiating subcommittee looking into that to get the full picture.
I am interested in capacity control though and in that respect, do you know the min and max monthly hours, and what the current scheduling target is? ... of the proposed contract ... and if not that, the old?
Got a get up early ... night is over for me.
Thanks ... do you know if this year's payment is based on last year's profits, or this year's? And do you know what is the "profit" used ... i.e. net profit as reported, profit before such and such, profit excluding such and such ... etc. ?
I know this year, it's adding 15% to wages, but last year it was near 8% ... 6% and say 3-4% the years before that. Just trying to figure out it works. Maybe I need to do some reading in their SEC filings.
I'm starting to wonder if DAL has put themselves at a competitive disadvantage.
Does anyone know the terms of Delta's profit sharing ... like "x"% or this year's profit, or last year's profit? Is it up to a certain amount? Does the percentage change at certain profit levels, etc?
Thanks ... I was waiting to hear from you. That fuel price should provide for a meet, or beat, of the current estimates.
He did say "at least" by mid-2015. I would think if there is any recovery in oil, producers will be selling their future production.
Oil is just rolling out to the next month, and as it does, every month oil pops a little bit. Happens every month.
cav ... don't you think the lower multiple for airlines is more due to the airline industry being viewed as cyclical ... tied to the business cycle, not necessarily tied to unexpected events. All stocks can have unexpected events.
The lower multiple just takes the place of using a higher multiple and what would be the "average" earnings over the business cycle. If the airlines can adjust capacity fast enough in the future during a business slow down, and the volatility of their earnings is lessened, the market may just tweak the multiple higher ... that's out in the future. But they are showing they are getting pretty good at right sizing the businesses for conditions.
First ... congrats on your quitting. (I'm surprised someone on the board didn't say they picked a bad week to quit sniffing glue, after you posted that.)
Actually, if this pullback is over, it'll be less than 10 percent ... tame historically for the airlines. I hope we can look forward to avoiding the usual 15-25% pullbacks in the future. I've gotten so use to it, I say, "Here we go again ... the next week or two isn't going to be fun." Then it is over and it bounces. Faith in fundamentals.
Can't believe the market was worried about that, but I'll take it.
The Fed has no room to raise rates unless long term rates rise enough so when then do raise short term rates it won't flatten the yield curve and slow things down. And I think people knew this ... the Fed wasn't going to indicate anything restrictive until the economy gets back on track ... we're going in the right direction, but nothing for sure yet. The Fed has room to stay put.
A good pullback to the 100 dma area after a six week run. Except for he Ebola scare, that's what the market has done over the last two years ... let's continue.
NY is a "one off". If not, more in the gulf can be done, Atlantic, numerous other places, if opened up. If oil goes back up, AAL make $6.50/share ... it's not going to take it back to $20. Really, how do you get a $20 stock price making $6.50?
mark, I still think there were some that found themselves with more than $3000 in netted losses this year ... sell a gainer against it, use the lose, go into the new year with a higher basis ... some won't choose to do that as you say ... I understand (I'm not doing it ... actually I have no losing stock ... knock on wood). One can always buy the gainers right back ... might even get a positive bump in the trade.
I was just throwing stuff out there. Frankly, I have no idea what the reason for the selloff is ... just the market doing its thing.
I was just saying if planned gains and losses netted to lower than the negative $3000, then someone might want to look for gains to use to offset the unplanned losses. And some may have had more unplanned losses if they were invested in oil areas and ended up selling more than initially planned.
That's been mentioned ... the high that day was $45.75. That was a continuation gap ... could be marked to be filled, but in the face of such positive fundamental changes that occurred since then, you just have to wonder. UAL just filled theirs, but both AAL and UAL have gaps below those. Or it could be further down to test its break our level, or the 50 dma. Still in the face of positive changing fundamentals, one has to scratch their head. It's not often you get the prospects of profits potentially going up 50-100% in a matter of months.
It could be people selling winners to even out the unexpected extra tax loss selling from the oil situations. They can buy back.
The Christmas black swan hasn't been mentioned recently and certainly never mentioned much anyway.
bears ... I'd lean towards mark as to what he feels about fuel savings in Q4. Late October guidance from AAL, put their fuel costs near $2.59/gal. And even though not hedged, their cost benefit from dropping fuel lags 2-3 weeks. FYI using midpoint costs from that late October guidance and analysts' average revenue estimates, AAL needed more fuel savings to just hit the previous $1.50 eps for Q4.
That said, obviously, forward guidance should look very good. And given the context of good forward guidance, this sell off doesn't make much sense, though I could list numerous excuses (reasons) for the selloff. In the list would be a black swan for the airlines, but that is always a risk.
Changing the subject, I imagine airlines are dusting off their Cuba marketing and operation plans.
I think the financial world, dealing in non-transparent, unregulated commodity derivatives, has had to see the new rules coming over the last 4-5 years. I bet that most had time to adjust. For marginal players it could be painful, but I think as a whole if the big financial players made adjustments, it won't be another financial meltdown.
In general the past market corrections most of the time found support around the S&P 100 dma ... we're there now ... it may hold ... just have to see.
Ya ... I hear a lot about budgets ... sounds like a personal problem. I hope they saved money during the good times, and they did, so they can use their sovereign fund proceeds and breakeven.
Thanks Unc ... I guess too that it is different for each company and each type of extraction. But accounting wise, we all have it figured out for the airlines ... percent of total costs that is.
$40 four years ago ... and I suppose not too many years before that it was less.