American's Financial Analysis
10-30-2023, 11:13 AM
#51
Gets Weekends Off
Joined APC: Mar 2014
Posts: 3,272
Disclaimer: I am an idiot.
Us mortals can look at the "numbers" and think we know what is going on with American. The truth is we can not.
I have 160 shares of AAL at an average price of $16. This stock used to be in the 50's just 6 years ago. I saw the drop in price and bought for all the reasons everyone has posted here: largest network, sunbelt cities, debt pay down, young fleet, etc, etc. "it has to come back" always rattled around in my pea brain. There is a reason the stock is $11 and slowly dropping lower. I don't know what that reason is but the big traders do.
Am I saying AA is going Chapter 11? Nope but the smart guys think they might and the stock is priced for that. That is all I need to know.
Here are the negatives for AAL. Highest seat costs in the industry. Also look at our hubs. I read an article saying we have to fly passengers farther to get them to their destination than say UAL. IDK, remember I am an idiot so I can not explain it here but suffice it say wall street wasn't overly impressed. Say CMH-DFW-LAX or CMH-DEN-LAX, what will burn less fuel? CMH-MIA-MEX or CMH-IAH-MEX. On paper our hubs look great to me but this article was pretty critical of AA's hub layout.
With all that said: the worst and best thing to happen to AAL in the last few years was Robert Isom getting promoted to CEO and that David guy taking over operations. He has this place running way better. The next step is for Robert Isom to leave/stepdown and get someone with half a brain in as the CEO. Not impressed with our current CEO but he was an absolute train wreck for operations so thank goodness he got promoted. F up, move up!
I would love for this stock to hit $60 again!
Us mortals can look at the "numbers" and think we know what is going on with American. The truth is we can not.
I have 160 shares of AAL at an average price of $16. This stock used to be in the 50's just 6 years ago. I saw the drop in price and bought for all the reasons everyone has posted here: largest network, sunbelt cities, debt pay down, young fleet, etc, etc. "it has to come back" always rattled around in my pea brain. There is a reason the stock is $11 and slowly dropping lower. I don't know what that reason is but the big traders do.
Am I saying AA is going Chapter 11? Nope but the smart guys think they might and the stock is priced for that. That is all I need to know.
Here are the negatives for AAL. Highest seat costs in the industry. Also look at our hubs. I read an article saying we have to fly passengers farther to get them to their destination than say UAL. IDK, remember I am an idiot so I can not explain it here but suffice it say wall street wasn't overly impressed. Say CMH-DFW-LAX or CMH-DEN-LAX, what will burn less fuel? CMH-MIA-MEX or CMH-IAH-MEX. On paper our hubs look great to me but this article was pretty critical of AA's hub layout.
With all that said: the worst and best thing to happen to AAL in the last few years was Robert Isom getting promoted to CEO and that David guy taking over operations. He has this place running way better. The next step is for Robert Isom to leave/stepdown and get someone with half a brain in as the CEO. Not impressed with our current CEO but he was an absolute train wreck for operations so thank goodness he got promoted. F up, move up!
I would love for this stock to hit $60 again!
10-30-2023, 11:16 AM
#52
Gets Weekends Off
Joined APC: Dec 2011
Position: A320 FO
Posts: 1,051
Clt has the shortest average distance flown of any major us hub. Dfw is among the highest, which is why our fuel bill is the highest even though we have a young fleet. Be patient, our hubs are strategic to where the population shift is occurring, and most of them are low cost per passenger. We’re the most unionized company with the highest cost structure, combine that with our debt and our flat net income, and that’s my opinion of why our share price blows.
Too bad about our cost structure but I like my paycheck. The FAs still need a contract, perhaps that uncertainty also dampens enthusiasm for the stock.
Jeff Mackey always said any day the market is open is a good day to sell airline stocks. I mostly agree, they move inversely to the price of oil which makes them mostly a derivative play on energy prices.
10-30-2023, 11:39 AM
#53
Gets Weekends Off
Joined APC: May 2023
Posts: 518
Here are the negatives for AAL. Highest seat costs in the industry. Also look at our hubs. I read an article saying we have to fly passengers farther to get them to their destination than say UAL. IDK, remember I am an idiot so I can not explain it here but suffice it say wall street wasn't overly impressed. Say CMH-DFW-LAX or CMH-DEN-LAX, what will burn less fuel? CMH-MIA-MEX or CMH-IAH-MEX. On paper our hubs look great to me but this article was pretty critical of AA's hub layout.
With all that said: the worst and best thing to happen to AAL in the last few years was Robert Isom getting promoted to CEO and that David guy taking over operations. He has this place running way better. The next step is for Robert Isom to leave/stepdown and get someone with half a brain in as the CEO. Not impressed with our current CEO but he was an absolute train wreck for operations so thank goodness he got promoted. F up, move up!
I would love for this stock to hit $60 again!
To your other point, ATL has very little strategic advantage other than the fact that Delta owns that airport and it’s generally a cheap area with good weather (nothing that isn’t also true about DFW). Delta customers have to either go way down to ATL or fight through the snow in MSP and DTW if they want to connect between the coasts, and they’re doing just fine. There certainly seems to be a lot of validity to establishing and fortifying fortress hubs and American has been doing that well.
I also think if AA can get the city of Philadelphia to pump some money into PHL, AA will eventually have a huge advantage in the European market.
10-31-2023, 07:43 AM
#55
Gets Weekends Off
Joined APC: Dec 2007
Position: Window seat
Posts: 5,527
Yet here he is leading one of the largest airlines in the world. Obviously he can lead a Boy Scout troop.
10-31-2023, 12:06 PM
#56
Gets Weekends Off
Joined APC: Dec 2013
Position: A320 CA
Posts: 2,316
10-31-2023, 12:08 PM
#57
New Hire
Joined APC: Dec 2019
Posts: 9
I was also in the Army, and the last people I will ever listen to about anything financial is someone else that was in the Army.
11-01-2023, 12:34 AM
#59
Banned
Joined APC: Nov 2020
Posts: 459
That man is a walking talking snake oil salesman. Those suckers over are United are about to find out sooner or later.
11-01-2023, 11:21 AM
#60
Gets Weekends Off
Joined APC: Jun 2021
Position: A320 FO
Posts: 655
Scotty boy loves bold ideas that require spending like a drunken sailor. Usually you spend money to make money, Scotty boy spends money so the airline can lose more money. How many of his bright ideas failed miserably at AA“G”? I heard he was undefeated at losing cash fast.
That man is a walking talking snake oil salesman. Those suckers over are United are about to find out sooner or later.
That man is a walking talking snake oil salesman. Those suckers over are United are about to find out sooner or later.
Last edited by CRJdriver2017; 11-01-2023 at 11:40 AM.
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