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Old 07-10-2008, 08:42 AM   #1  
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Smile Gambling on XJT and their future

Yes it a gamble but here’s what I’m thinking.

There are many reasons for XJT underperforming stock but here are a few:
a. XJT just announced the closing of Branded.
b. They’ve announced the termination of their DelConn
c. They’ve announced future furloughs
d. They’re stock is at it's lowest price mainly due to the above 3 facts plus fuel and the US$.
e. They will be returning several a/c to their leasers and transferring others back to CAL ops.
f. They must spend a large amount of money reorganizing their fleet and closing down operations.


Why I am willing to take the risk:
a. Their future looks strong after they reorganize.
b. Yes they are losing money but that will shortly come to an end.
c. They have a good Mgmnt team.
d. They have well above average labor groups who believe in their company and are willing to go the extra mile in order to survive.
e. They are not going bankrupt unless CAL renigs on their new 7 year CPA.
f. Another investor could purchase the company which would drive the stock price up considerably.
g. With MFN Clause now gone they have the opportunity, yes down the road, to bid on new flying.

Therefore I felt very comfortable when I bought (for a conservative investor) a rather large amount of their stock yesterday at $.361 per share (to date this investment is the 2nd largest stock investment I made, 1st largest was when I bought 1500 shares in Sherwin-Williams Co. back in the early 2000’s for around $15/share............... $$$$$$$$$$ paid off HUGE after it split and settled a little above todays price). I think that XJT has a very strong future ahead of them and even though their stock is currently doing poorly, I feel that over time it will start to reflect a price more in line with the company’s actual future stability.

Only time will tell but for now I’m very pleased with my investment and I wish all XJT employees well. Keep up the good work.

Would any XJT pilots or investors care add on?

BTW, I didn’t invest more than I am willing to lose, that’s just the way I gamble.

Last edited by JetJock16; 07-10-2008 at 09:01 AM.
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Old 07-10-2008, 09:02 AM   #2  
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It should be as good as any airline stock can be in the current environment. Looks like all of their risk has been stabilized. Three questions...

- I assume CAL pays for ALL of their fuel?
- What are they going to do about the lease payments on those branded ERJ's?
- Is DAL paying leases for the LAX ERJ's?

Of course if CAL goes into Ch.11 all bets are off.

Personally, as a long-term investor, I stay out of airline stocks...too many things that can go wrong with no warning.
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Old 07-10-2008, 09:06 AM   #3  
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After they settle their debt issues and come out with how much stock they will have to issue to appease some of their bond holders (which is a bad deal for bond holders btw) it will be a little more clear where the stock will settle. Right now i think the bond holders will renegotiate their % rates charged to xjt and everyone will be happy. One major problem with your purchase could be that xjt might be delisted... probably wont happen but might ... It usually takes about 6 months after the initial 30 days below 1.00 to be delisted.
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Old 07-10-2008, 09:08 AM   #4  
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Quote:
Originally Posted by rickair7777 View Post
It should be as good as any airline stock can be in the current environment. Looks like all of their risk has been stabilized. Three questions...

- I assume CAL pays for ALL of their fuel?
- What are they going to do about the lease payments on those branded ERJ's?
- Is DAL paying leases for the LAX ERJ's?

Of course if CAL goes into Ch.11 all bets are off.

Personally, as a long-term investor, I stay out of airline stocks...too many things that can go wrong with no warning.
The way I understand it is that all the branded XR's are being returned to CAL along with XJT returning their 135's to their leasers.

I completely agree with staying out of airline stocks but with XJTís new CPA and their stock sitting so low I couldnít resist. BTW, whenever Iím awarded SKW stock I dump them the minute I can into my Roth.
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Old 07-10-2008, 09:10 AM   #5  
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Quote:
Originally Posted by rickair7777 View Post
It should be as good as any airline stock can be in the current environment. Looks like all of their risk has been stabilized. Three questions...

- I assume CAL pays for ALL of their fuel?
- What are they going to do about the lease payments on those branded ERJ's?
- Is DAL paying leases for the LAX ERJ's?

Of course if CAL goes into Ch.11 all bets are off.

Personally, as a long-term investor, I stay out of airline stocks...too many things that can go wrong with no warning.

1) yes CAL pays all fuel
2) reduced lease payments for any of our "branded" aircraft were negotiated under the 7 yr cpa with CAL
3) DAL erjs are being returned to CAL and ending the lease agrrement on those aircraft between xjt and CAL. CAL plans to park them in the desert.

also of note is that XJT will be looking for pay cuts across the entire company soon... if they get them you could expect them to be profitable in the 4th quarter... 3rd quarter you will see too many one time expenditures to have a profit
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Old 07-10-2008, 09:11 AM   #6  
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Quote:
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- I assume CAL pays for ALL of their fuel?
fairly certain they are.


Quote:
Originally Posted by rickair7777 View Post
- What are they going to do about the lease payments on those branded ERJ's?
CAL pays for all the planes on lease now except the reduced lease payments we have now on the 30 we kept for Charter.


Quote:
Originally Posted by rickair7777 View Post
- Is DAL paying leases for the LAX ERJ's?
CAL is now paying those.
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Old 07-10-2008, 09:12 AM   #7  
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After they settle their debt issues and come out with how much stock they will have to issue to appease some of their bond holders (which is a bad deal for bond holders btw) it will be a little more clear where the stock will settle. Right now i think the bond holders will renegotiate their % rates charged to xjt and everyone will be happy. One major problem with your purchase could be that xjt might be delisted... probably wont happen but might ... It usually takes about 6 months after the initial 30 days below 1.00 to be delisted.
That is a concern but if they are delisted I don't lose my money. They are just considered penny stocks and are still traded. But after they're finished reorganizing I feel that their stock will climb out of the gutter.
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Old 07-10-2008, 09:14 AM   #8  
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Originally Posted by newarkblows View Post
1) yes CAL pays all fuel
2) reduced lease payments for any of our "branded" aircraft were negotiated under the 7 yr cpa with CAL
3) DAL erjs are being returned to CAL and ending the lease agrrement on those aircraft between xjt and CAL. CAL plans to park them in the desert.

also of note is that XJT will be looking for pay cuts across the entire company soon... if they get them you could expect them to be profitable in the 4th quarter... 3rd quarter you will see too many one time expenditures to have a profit
Stand tall and don't give up your contract, you guys deserve it.
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Old 07-10-2008, 09:41 AM   #9  
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Stand tall and don't give up your contract, you guys deserve it.
right on. i was just talking as an investor before. IF they get the pay cuts. I would rather be on the street then make this profession that much more of a joke.
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Old 07-10-2008, 09:45 AM   #10  
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I was actually thinking of starting this very thread. I have a small position @ $1.99/ share and watched it go up to $3+ in anticipation of the SKYW $3.50/ share deal but I didn't sell and then when the deal fell apart it went down to where it is now. I'm thinking of adding a lot at these prices, but there is a significant risk. July 31 at 5:00 pm Eastern time XJT will know how many notes are being submitted for repayment, and if those holders will want cash, stock, or a combination. If everyone wants payment, and in cash it could be bad news

an excerpt from their SEC filing dated July 2

If we do not meet the conditions to using our Common Stock in connection with our obligation to repurchase Notes under the Indenture, we would be required under the Indenture to purchase with cash consideration all of the Notes tendered in this Offer to Exchange. In the event that we are so obligated to purchase the Notes for cash, we may default on that obligation and the Indenture and may have to seek bankruptcy protection or commence liquidation or administration proceedings. In that case, the Holders may not be repaid the principal amount of their Notes.



we also need to reduce overhead expenses consistent with the operation of a smaller fleet. Our initial goal is to reduce our annual operating costs by approximately $100 million, which will be necessary for us to be profitable. Although a significant portion of that amount will be volume-driven, we anticipate that overhead reductions will comprise at least 35% of that amount, which we intend to address through a reduction in workforce, wage concessions and other expense reductions. There can be no assurance that we will be successful in reducing our expenses or that we will be profitable in the future.
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