CLazarus

I said Wildcard for a reason, because I didn't think it was a likely possibility. 2022 is a best case MOM EIS scenario. I only threw MOM out there because it seems to me Boeing's only hope to compete with the 321NEO. I can't imagine airlines being any more interested in a -10 Max than the -9 Max (which by a wide margin is being outsold by the 321NEO).

Dave Fitzgerald

Agreed.

Lots of studies going on and X planes being proposed in the MOM size. Blended wing, double bubble fuselage, super high aspect wings. All with potential for significant savings in weight and double digit increased efficiencies. It wouldn't surprise me if Boeing waited just a bit to leverage one of these new technologies.

A fast start to a MOM plane today would be, my guess, a carbon wing 757 update. But all indications are that Boeing is still waffling and procrastinating.

webecheck

If I was mgmt and I knew the long term prospects of the company were good, the market was undervaluing my stock, and i had a glut of cash I wanted to put to use...I would forego using the cash for recapitalization provided my current assets could get the job done, undergo a massive buyback until my stock was fairly or overvalued, then release those treasury shares when I want to recapitalize my fleet and my stock price has essentially doubled or more. The stock has almost doubled off the low a couple months back...all those buyback shares have proven to be a wise decision at this point in time. If the shares are retired, stockholders win because of a negative dilution effect. If those shares are reissued at higher prices the company is better off, and the stockholders may also be as well depending on the ROI of the treasury share value. If they are reissued at lower prices than the buyback price, the company and stockholders all lose.

It remains to be seen what ultimately happens with this glut of buyback cash that has been used, but it's possible we all may win from it.

Grumble

Can we just buy back the shares PAR and Altimeter hold, then boot them?

webecheck

If they want to sell them, then yes.

Holding treasury shares also can be a defensive move by the company itself. It prevents hedgies, or hedgy allies, from accumulating too many. Some companies buyback to hold enough voting rights to prevent being fleeced by unscrupulous members of the BoD.

My first reaction to the buyback was like everyone else. However, idle cash is of no use if opportunities exist to generate wealth for the company, or like the above, a defensive position that may in the future benefit all employees. The verdict will be out when we see what they do with the treasury shares. I think it was Kirby that said we have enough iron to generate the seat miles we desire already, so i'd agree that spending money on extra iron isn't the smartest decision. If in a year or 2 all these undertakings actually result in movement towards the desired effect (1.5% margin premium to delta by 2020), then the company will be more financially sound, and assuming the PE remains the same the stock price will be higher...5 billion spent on treasury shares may be worth 10 or more. Just spitballing numbers but you get the idea. Or course, you could also use the cash to pay down debt instead, or recapitalize if operating costs are high....lots of options, this is the CFO's job. I think the fleet is fairly young and mgmt is saying we have enough iron already. Debt is cheap right now, so why pay it off. Its all an ROI comparison game.

So in 2 years if mgmt is able to see that the initiatives are working and we have more cash available, courtesy of the buyback...well that could turn into a huge win for all of us. Given the predicted recession, uncertainty about post election initiatives, what sense does it make to buy 700s just because they were cheap if we already have the iron to grow ASM?

We just don't have all the answers, but ask yourself, what will be become of Oscar's legacy is he reverses course on all the things that have shown to be smart moves so far....ie, taking RJ flying back being the most important to us. Mgmt said in the last CC or the one before it that bringing Express flying back to mainline has been a smart move for the bottom line. Can only speculate so much.

Also heard some rumors about Republic today. Guess they have about 40 CS300s on order. Havent looked into it, may some other Nostradamus can do a little homework.

Last parting shot, if its good for the shareholders, then its good for our PS checks! So come contract time, ZERO concessions to PS.

awax

I say we organize an ESOP and all take pay cuts to capitalize the share purchase. What could go wrong!

Probe

And start an airline within an airline, to compete with the LCC's!!!

Probe

The 321NEO LR is a gigantic problem for Boeing. No matter what Boeing builds, it is going to have to spend billions to develop it, and it will never be able to compete with the 321 on purchase price. Even if it just re-engined, and restarted the 757 line, the 757 was a much more expensive aircraft to build than the 320 or 737. By Boeings' own admission, it never built a lot of 75's per month, and they never got the economies of scale they got with the 73 line.

The MOM is going to have to be a WHOLE lot better than a 321NEO LR to justify costing twice as much.

SpecialTracking

Nothing. We are employee owners with a seat on the BOD while stuffing our entire 401k into company stock. Blue skies for all.

bigfatdaddy

We could call it Far Ted.....to capitalize on our global reach......Farted for short. 😂😂😂😂