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Quote:

Originally Posted by jsled (Post 174648)

Bob Crandall does not call it fuel hedging. He calls it a gamble. He noted recently that many airlines have lost a lot of money on fuel hedges in the past. You are only "brilliant" if you guess right, just like picking a stock. Having said that, fuel hedging is not their magic formula. It is their incredibly low employee to airplane ratio. It keeps their costs untouchable even with high wages.

And exactly what is it in this business that's a "sure thing"?

If you're not willing to gamble, this is the wrong business.

Quote:

Originally Posted by Gman (Post 174356)

Bob McAdoo lowered his rating to "Underweight" from "Overweight" and reduced his price target to $16 per share from $22.

Bob McAdoo? Didn't he used to play for the Buffalo Braves? Spent some time as a Laker too. I think he's retired now.

Quote:

Originally Posted by 1Seat 1Engine (Post 174758)

Bob McAdoo? Didn't he used to play for the Buffalo Braves? Spent some time as a Laker too. I think he's retired now.

He retired in '85 after winning a championship with the Lakers. He's an assisstant coach for the Miami Heat now.

Apparently, he still owns a pawnshop in Buffalo, but I found no mention of his stock picking prowess or his knowledge of the airline industry.;)

Attachment 903

I was about to say, who cares what this "bob mcadoo" has to say?

Quote:

Originally Posted by 1Seat 1Engine (Post 174746)

And exactly what is it in this business that's a "sure thing"?

If you're not willing to gamble, this is the wrong business.

Perhaps. I was just relaying the opinion of one of the best former airline ceo's in the business. I think everyone is making too big a deal on the fuel hedge thing. You can lose just as easily as you can win.

Not working? But still making $$

Quote:

Originally Posted by Gman (Post 174356)

Dream over for Southwest?

Prudential Equity Group downgraded the stock, saying the company's business model "does not appear to be working anymore."

Foremost among Southwest's problems is over-expansion: the airline continues to swell its fleet at the rate of about 35 planes per year, even though it is losing money on many of its recently added routes. McAdoo added that Southwest lacks direction, and lowered his target price from $22 to $16, and dropped second quarter estimates to 26 cents from 41 cents as well. "Lacking some new direction, we believe LUV shares are going nowhere," McAdoo says.

What is going on? Has reality set in?

Well, let's see....SWA continues to make a profit, even though the cost of their hedged fuel went up 83% over the past year. And as you expand, that's more planes and more fuel...

What I like to see is the company's "long range" market development philosophy. Some markets may not be big money makers right now, but as the airline continues with it's methodical, pre-planned expansion, with competitive costs per seat mile traveled, I think the airlines future is bright. Personally, I think LUV stock is at a very reasonable price right now, and if I had to own an airline stock, it would be on my short list.

This analysts opinion is a typical short-term, instant gratification one, typical of today's MTV generation.

Quote:

Originally Posted by Gman (Post 174356)

Dream over for Southwest?

Prudential Equity Group downgraded the stock, saying the company's business model "does not appear to be working anymore."

Bob McAdoo lowered his rating to "Underweight" from "Overweight" and reduced his price target to $16 per share from $22.

Foremost among Southwest's problems is over-expansion: the airline continues to swell its fleet at the rate of about 35 planes per year, even though it is losing money on many of its recently added routes. McAdoo added that Southwest lacks direction, and lowered his target price from $22 to $16, and dropped second quarter estimates to 26 cents from 41 cents as well. "Lacking some new direction, we believe LUV shares are going nowhere," McAdoo says.

What is going on? Has reality set in?

Your opinions please

My opinion is if SWA is in a situation where they are under pressure, JetBlue is royally scruwd

Good Luck Gman...

Quote:

Originally Posted by jsled (Post 174815)

I think everyone is making too big a deal on the fuel hedge thing. You can lose just as easily as you can win.

Not only that, but their two sides to the profit equation. Expenses vs. Income. Low cost are great but if you don't have a decent yield from your product the end result is the same.

The biggest danger to the Legacy carriers is their high costs!

The biggest danger for the LCC carriers is their Low yields!

Onfinal

Quote:

Originally Posted by 1Seat 1Engine (Post 174758)

Bob McAdoo? Didn't he used to play for the Buffalo Braves? Spent some time as a Laker too. I think he's retired now.

Yes. But more importantly he was a TARHEEL!!:D

Perhaps old Stevie Boy should take a look in the mirror. Where is he going? Nowhere out of Somerset NJ... that's where unless he uses daddy's legacy to take him there.