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Alcoa Inc. Message Board

wgrsh 366 posts  |  Last Activity: 14 hours ago Member since: May 11, 2005
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  • Reply to

    Mr. Parker is acting like Santa Claus

    by carruthersdevelopers Dec 23, 2014 3:45 PM
    wgrsh wgrsh Dec 24, 2014 12:35 PM Flag

    // But the money is on the table. //

    Well, the synergies aren't in yet. The fuel savings is just happening and no guarantee as to how long it will last. So, you want to lock in something for years, because of synergies that haven't happened, and a fuel savings, which just started a few months ago, and not many have a handle on yet?

    I would guess that if these fuel savings last and synergies come in, the company may open the contract before it comes to an end. In the meantime, enjoy the upgrades, new equipment, secure job and smile .. it's Christmas.

  • Reply to

    coming back

    by j26231f Jan 12, 2015 10:55 AM
    wgrsh wgrsh Jan 12, 2015 2:58 PM Flag

    Thanks unc ... understand the way you do it (and I usually do it that way for revenue too). You started with revenue to get pre-tax profit, and I started with their cost guidance. Get the same number, and agree there is a "range". So, there we are.

    (I did it with fewer numbers :) ) maybe not? Either way ... AAL does spoon feed the numbers, don't they?

  • Reply to

    Good Post

    by markusgzee Jan 23, 2015 11:56 AM
    wgrsh wgrsh Jan 23, 2015 2:44 PM Flag

    Unc ... 5% is not bad growth. It's not going to give you a high growth tech PE, but even no growth stocks can be trading below their "no growth" PE. Theoretically, there are only three variables in the "PE" model, earnings, growth of those earnings and the interest rate you discount those future earnings. Even a "no growth" yields a PE value. 5% growth isn't bad ... and especially as in the case of AAL, where earnings jumped 80-100% the year before (2015). Those are in-close earnings (2015), not earnings growth years out ... much more valuable (present value wise).

  • Reply to

    Delta's profit sharing

    by wgrsh Dec 18, 2014 9:30 PM
    wgrsh wgrsh Dec 18, 2014 11:21 PM Flag

    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.

  • wgrsh wgrsh Jan 29, 2015 1:36 PM Flag

    // based on 700m shares diluted. //

    unc, think you have to use 719m diluted for Q1 (unless you're counting on more buybacks this Q)

  • Reply to

    Daily savings

    by bearsrunfrombulls Jan 7, 2015 10:51 AM
    wgrsh wgrsh Jan 7, 2015 10:56 AM Flag

    $2.70 for 2014 is really optimistic. At the end of October they estimated about $2.90 for 2014 and definitely had a good idea about November fuel at the time. I just don't think December fuel was low enough to tank the average for 2014, 20 cents.

  • Reply to

    Delta hedges, part 2

    by bearsrunfrombulls Jan 5, 2015 2:01 PM
    wgrsh wgrsh Jan 5, 2015 3:13 PM Flag

    I agree bears. Mark to market losses (non-cash losses) for all hedges in future at today's prices. Then each quarter in the future will take the cash loss (+/-) as oil fluctuates. Essentially, this writes down their hedges to today's prices.

  • Reply to

    Who can come up with the biggest number?

    by wgrsh Jan 7, 2015 3:36 PM
    wgrsh wgrsh Jan 7, 2015 4:11 PM Flag

    Come on bears ... the contest is for the biggest number ...

    The $4.3 billion included the pre-merger agreement as to labor costs, so only the additional 4% would need to be considered. And the $4.3 billion is still reasonable given AAL hit their estimate of $3.7 billion for 2014 without using the lower fuel this year. Knock off 50 cent from my $13.60 for the 4% and my $13.10/share is still bigger ...

    Even a 50% retracement in oil (for all of 2015) would about $10/share ($9.75) ... knock off 50 cent for labor costs not counted. (that would be $75-80 oil)

  • Reply to

    I get $11 for 2015 EPS

    by iahphx Dec 10, 2014 11:11 PM
    wgrsh wgrsh Dec 11, 2014 7:38 AM Flag

    bears ... AAL uses in the area of 4.4 billion gallons ... don't forget the regional fuel that needs to be added to mainline. Also, the labor cost increase to the extent of the premerger agreements were taken into account in expected synergies. All in all, not counting the oil impact, the expected earnings should be $6+ for 2015. A dollar drop in fuel for 2015 should double that eps (not saying oil will average a buck down). Anyway, it looks like $6-12 ... pick your number depending on fuel.

    AAL also said a few months ago that 2015 CASM would be flat YOY as well.

    I would also expect an impairment charge announcement due to Venezuela. That possibility was announced months ago and quantitatively put out in the October guidance, so probably shouldn't surprise the market ... hopefully not, but I imagine any market reaction would be short lived.

  • DAL expects and planning on a 70 cent drop in fuel for 2015.

  • Reply to

    air travel

    by a42unateinvestor Jan 27, 2015 2:22 PM
    wgrsh wgrsh Jan 27, 2015 3:49 PM Flag

    carruthers ... I think you are taking PRASM guidance out of context ... but then again news headlines do it too ... I posed a question to markus in a post about 30 minutes ago (around 2:14 cst). How would you answer it?

    I've been listening to Parker and crew at CC's for a while, and I felt they were very positive. Iahphx, if you listened, what did you think of the tone of the CC?

  • Reply to

    air travel

    by a42unateinvestor Jan 27, 2015 2:22 PM
    wgrsh wgrsh Jan 27, 2015 4:36 PM Flag

    // Mr Parker sounded positive but he's been at the head of the airlines since it was $12 & he should sound positive. //

    Well, he's been doing CC's for quite awhile, and there are times when he isn't positive ... he was positive today.

  • Reply to

    Peter Orszag/Price of oil

    by bearsrunfrombulls Jan 6, 2015 8:46 AM
    wgrsh wgrsh Jan 6, 2015 4:38 PM Flag

    Good logic, ... the question is what is the fracking number? And then again Iraq wants to get to where the Saudis are; Iran wants to pump, Libya wants to eventually pump back in the 1.6 mil bbl/day, Russia wants to pump, everyone wants to pump.

    With the CFTC coming out with new rules (that's what happen in June, the CFTC showed they were serious), I think those that had "manipulative" speculative positions are selling (and normal speculators are probably selling too given the circumstances). Normal long speculators will come back in, but the manipulative positions won't, if the CFTC knows what it is doing. So, what is the proper supply and demand level given the new currency levels without manipulative speculators? I'll go with your logic, but the whole world wants to pump, not just the frackers.

  • Reply to

    Monthly report

    by wgrsh Dec 8, 2014 9:33 AM
    wgrsh wgrsh Dec 8, 2014 10:26 AM Flag

    It is holding up pretty well.

    A lot goes into that year over year number and AAL is not quite the same as the two separate airlines ... I just have a hard time working with these numbers ... I'll be glad when we get into 2015. And a lot has probably changed ... has stage length changed on average vs the two separate airlines? That can change numbers for comparative purposes ... a lot of metrics I don't have a handle on. But I can say, as everyone is saying, this drop in fuel is breathtaking and trumps a lot of other numbers. In the end the company still has to aggressively manage the other metrics.

  • Reply to

    UAL,LUV, HA, & JBLU are the favorites

    by carruthersdevelopers Dec 10, 2014 10:48 AM
    wgrsh wgrsh Dec 10, 2014 11:15 AM Flag

    car ... PRASM YOY is watched and for good reasons, but many times it is used in an isolated way, which is not the right way to look at it. PRASM YOY going down can indicated some weakness, but maybe not too. It is just "passenger" revenue spread over ASMs. What if gauge is increased and filling up those extra seats is still being developed (at the same (or higher) fares, and that developing load factor may still exceed the variable CASM of the increased gauge ... if old ASMs are used PRASM would look stronger, plus there a contribution to profits from the developing gauge increase in ASMs. That could be a positive, positive, but is seen as just negative ... go figure.

    PRASM is also is impacted by stage length ... and so is CASM ... lots of things to look at to get the picture right. And that is not even discussing that the PRASM presented in the monthly report is a YOY percentage change which we beat to death the other day.

  • Reply to

    DAL figures

    by markusgzee Jan 9, 2015 3:26 PM
    wgrsh wgrsh Jan 9, 2015 10:24 PM Flag

    I can agree to that. Though hedges will run out. They do have an on going problem if fuel stays low and profits balloon. They may need to have some heart to heart talks.

  • Reply to

    Mr. Parker is acting like Santa Claus

    by carruthersdevelopers Dec 23, 2014 3:45 PM
    wgrsh wgrsh Dec 24, 2014 10:44 AM Flag

    // My pay does not begin until the door is shut and breaks are released yet... //

    fly ... Actually, the bulk of your pay is salary through a monthly guarantee with incremental hourly pay. l would say your work starts when you report for work, and being a professional before that many times.

    Your group agrees to negotiate through your union, rogue behavior by some doesn't help the cause or the profession.

    When you go to work, give AAL a bang for the buck and get money on the table to negotiate for.

  • Reply to

    Oil projections - 2105

    by carruthersdevelopers Jan 14, 2015 2:23 PM
    wgrsh wgrsh Jan 14, 2015 4:02 PM Flag

    unc, oil did jump just after 2. And then all airlines dumped. Some airline trading algos must have picked up on the oil. Isn't that just our luck? Get great new fundamentals on the airlines with jet fuel down big, and we have to put up with the way the "old algos" are written to trade airlines. Just can't find good help these days.

  • Reply to

    UAL reported tonight

    by wgrsh Jan 9, 2015 9:05 PM
    wgrsh wgrsh Jan 10, 2015 6:44 PM Flag

    unc ... I had a "moment" and couldn't find the envelope with my figures, so I refigured quickly. Not as bad as I recalled. I think if AAL beats UAL's unhedged fuel by what you said is historical, AAL can at least meet the $1.53 (assuming average revenue estimates are right and midpoint costs). Your $2.49/gal adds some comfort. Okay ... all is well in a Saturday of panic.

    Now, I have to get back to "other" estimates needed in a few days ... but that will keep me at the computer ... what a way to spend a Saturday.

  • Reply to

    Short Interest

    by islandbrook2000 Dec 26, 2014 11:08 AM
    wgrsh wgrsh Dec 26, 2014 2:12 PM Flag

    bears, they don't release monthly PRASM .... they change it a year ago. They say what they believe the quarterly PRASM YOY will be and may adjust that monthly ... but it is not a monthly PRASM YOY number.

    And they do give what they think their costs will be for the quarter. But not monthly ... thought they could update it as they feel needed during the quarter, or before earnings release.

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