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Alcoa Inc. Message Board

wgrsh 46 posts  |  Last Activity: Apr 26, 2016 1:15 PM Member since: May 11, 2005
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  • Reply to

    Take me to your leader

    by brounholeyo Apr 26, 2016 10:53 AM
    wgrsh wgrsh Apr 26, 2016 1:15 PM Flag

    Rails, trucking, ... there is something incongruent. Transports are a leading indicator and after a year going down they finally look as if they are turning up ... and then on the other hand everyone is implying that a recession is coming ... one or the other is wrong. Then again, I suppose we could keep muddling along.

  • Reply to

    Take me to your leader

    by brounholeyo Apr 26, 2016 10:53 AM
    wgrsh wgrsh Apr 26, 2016 12:27 PM Flag

    // Transports are a leading indicator, ... //

    DJT is close to a golden cross ... maybe make it, maybe not ... it is close though.

  • Reply to

    Parker Put

    by unclespeaking Apr 22, 2016 10:03 AM
    wgrsh wgrsh Apr 23, 2016 7:11 PM Flag

    // LUV is same as everyone else with declining PRASM //

    Guess I didn't hear their Q2 prasm forcast correctly. Thought they said it would be in the flat range.

  • Reply to

    Parker Put

    by unclespeaking Apr 22, 2016 10:03 AM
    wgrsh wgrsh Apr 23, 2016 12:23 PM Flag

    Understand and agree with what you're saying, Unc. Changing the subject to LUV ... LUV going to flat prasm is somewhat of a good sign. YOY can be hard to compare sometimes as your example with DAL, but going to flat prasm is the right direction for domestic operations. AAL mentioned lapping the DAL (Love) situation in September. And internationally, the dollar and fuel surcharges and some international weakness will be lapped in the future. That could leave the carriers with lapped YOY situations, but still with low prasm that is also at a level that is still producing good earnings.

    Besides UAL and DAL mentioning that they will manage capacity, I read an article this week that LUV said they are pulling back on their 2017 capacity. At least that is going in the right direction. Maybe AAL's Q1 prasm will be at least flat in 2017, YOY.

    Is the future brighter? And when will the market be more forward looking? Always questions.

  • Reply to

    Parker Put

    by unclespeaking Apr 22, 2016 10:03 AM
    wgrsh wgrsh Apr 23, 2016 10:37 AM Flag

    // ... at 2015 4q call he said 1q prasm would be the "trough", ... //

    cav, I took the term "trough" as being nominal and not YOY. I didn't necessarily take Kirby's statement as saying much, since Q1 nominal prasm could very well be the lowest for the year, but still have other quarters show YOY declines. I didn't check out the numbers to see if that was right way to look at it.

  • Reply to

    Report

    by cavalier2015 Apr 22, 2016 8:01 AM
    wgrsh wgrsh Apr 22, 2016 1:44 PM Flag

    cav ... not that it matters much, given other things, but wasn't margin guidance 14-16% for Q2? I just used the midpoint.

  • Reply to

    Report

    by cavalier2015 Apr 22, 2016 8:01 AM
    wgrsh wgrsh Apr 22, 2016 12:49 PM Flag

    I used 590M shares, and 15% margins, and current Yahoo consensus revenues. I would say estimates will drop to the mid $1.60s (+/-) for Q2. (Are yahoo consensus revenues accurate?) It wasn't too long ago that I had 2016 estimates in the $5.50 range (+/-) ... could be headed towards that again.

    The analysts really pumped up earnings for the industry during Q1 ... they were the ones that messed with things. ... How to make a $37 stock with $5.50 eps look bad.

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 3:34 PM Flag

    ALK hedges cheaply, but it still costs. But who's to say ... ALK runs a good show.

    Parker hasn't had any hedge impact since 2009 when he stopped hedging ... and has always made out better than others since.

    Analysts ... rather a grumpy group lately. Some of their thoughts work out, some don't.

  • There are so many different contracts being done all the time in the industry it is hard to keep up. But it seems AAL has the bulk of their contracts done for awhile, and is in the "tweaking" mode. Whereas, DAL, LUV, UAL, and some others have some major contracts to resolve soon.

    Regardless, think it is a good time to put across a fare increase, especially when everyone is giving them cover by pumping the bad industry metrics.

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 1:50 PM Flag

    Definitely volatile price movements around earnings and dividend time. Even some people isolating the variables to play the game ... even more so than in the past.

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 1:42 PM Flag

    // LUV's PRASM was down 3.63%; but RSAM was one penny Up from 13.67c to 13.68c //

    One's a YOY number and one is a nominal change. And I was never implying LUV isn't doing well, just that domestically operations aren't that different.

    LUV had a good year hedging in 2008 ... lost out every year since.

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 1:34 PM Flag

    Look at DAL ... low debt, higher dividend, and they are only 12-13% higher per share. But their earnings per share are 9% higher. So, does lower debt and higher dividend add anymore than 3-4% to share price?

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 1:13 PM Flag

    Domestically, things are ok. I would think the legacies have near the situation with LUV as far as domestic prasm goes. I thought LUV's prasm was down about 3.5%. And the other half of the prasm problem for legacies is with the global demand, and dollar, fuel surcharges. The dollar and fuel surcharges will eventually lap themselves yoy. Things just have to play out.

    There seems to be a tone change with the pundits not believing the industry has changed and are reverting to old ways. That is an easy sell to investors.

    Market pundits in all sectors have been jumpy lately ... Armageddon one day, not Armageddon the next ...

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 12:20 PM Flag

    Isn't LUV's capacity growth this year mainly with their international growth, and not domestic? LUV also reduced their 2017 capacity plans. One by one capacity plans are coming down.

    Airlines need to come out with another fare increase.

    For those that follow tidbits ... AAL covered its gap at $40.01 today. DAL almost covered theirs ... UAL has to get into the $49s. AAL also left a gap above today, making 3 gaps above.

  • Reply to

    Cowen

    by cavalier2015 Apr 21, 2016 11:28 AM
    wgrsh wgrsh Apr 21, 2016 11:52 AM Flag

    Some of that move out of the midpoint of original guidance had to do with fewer storms this year in Q1. Other aspects include longer stage lengths, increasing gauge, dollar, fuel surcharges, etc. Not that it matters ... the pundits are pounding on prasm. Revenue and costs have to stabilize. At least with stable revenue, margins can be meaningful.

  • Reply to

    $38 tomorrow

    by rpetraso Apr 21, 2016 9:46 AM
    wgrsh wgrsh Apr 21, 2016 11:01 AM Flag

    // a couple billion left //

    Thought they said it was under a billion left, when they said they bought back the 39 million last quarter ... didn't reconfirm either though.

  • Reply to

    $38 tomorrow

    by rpetraso Apr 21, 2016 9:46 AM
    wgrsh wgrsh Apr 21, 2016 10:33 AM Flag

    They are getting to the end of the buybacks, and the bulk of the integration expenses ... not that there isn't more to do. Debt may move up in priority. If not this quarter, they are getting closer to managing it differently. All that said, AAL is still getting a bunch of new aircraft.

  • Reply to

    UAL reported ahead of Super Thursday

    by unclespeaking Apr 20, 2016 4:54 PM
    wgrsh wgrsh Apr 20, 2016 5:16 PM Flag

    Then again for all the reasons, UAL has gone up 8 straight days.

  • wgrsh by wgrsh Apr 20, 2016 4:27 PM Flag

    Looks like they beat eps and met revenue ... have to see what they say.

  • Reply to

    30 minutes away from EIA report

    by unclespeaking Apr 20, 2016 10:10 AM
    wgrsh wgrsh Apr 20, 2016 12:41 PM Flag

    DAL did call for positive prasm starting in Q3 (July). If that didn't pan out, they said they would adjust their capacity.

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