Originally Posted by
Bucking Bar
Nope. Rather a million folks catching the funk I caught last fall ... Capacity Reduction Funk. My hedge fund buddy sent me a text at 12:21 as DAL trading caught the attention of his software.
His other point was that by buying oil refineries and more new RJ's to adjust the mix at DCI Delta was not investing in its core business. That again, was the observation driving my funk last fall.
Sorry, but I believe (it is my opinion) that WS folks who do not see the reason behind DAL's acquisition of the refinery are clueless. It is ABSOLUTELY part of the core business. It is NOT a profit center. Fuel is $12 billion/year (or something like that). Any significant reduction in that cost is directly transferred to the bottom line. Hedge fund managers and WS types look for the quick kill, and therefore have a certain myopic view. A $300 million reduction (2.5%) in the number one cost to a company in an industry that has thin operating margins like the airline industry is damn smart business. Besides, we are not running the refining operation... geeeez