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New Air Canada shares gaining early altitude
By Brent Jang
UPDATED AT 2:02 PM EDT Tuesday, Sep 21, 2004
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Don't laugh, but new Air Canada shares could be a screaming buy, at least in the early going.
Shares in the airline's new parent company, ACE Aviation Holdings Inc., have surged in over-the-counter trading in the United States.
ACE shares last traded hands at $20.21 (U.S.), as some creditors shuffle their holdings before Air Canada emerges from bankruptcy protection on Sept. 30.
ACE stock hasn't traded in the past three sessions, but last Wednesday, 5,000 ACE shares crossed the over-the-counter market for the equivalent of about $26.21 (Canadian) -- a 31-per-cent premium over their $20 face value to creditors.
Now, after being warned repeatedly to steer clear of the beleaguered airline, investors could be forgiven for being skeptical. After all, the old Air Canada stock stopped trading on Aug. 25 for a measly 6 cents a share and are now virtually worthless, unless you happen to own a whack of shares. If you held 11,894 of the old shares, you're entitled to a single, solitary ACE share.
But that was then, and this is ACE -- a new entity with a sharply lower debt load and a new lease on airline life.
The spike in ACE's share price is the first indication that the stock is poised to soar well above its $20 face value when it begins trading on the Toronto Stock Exchange on Oct. 1.
Trading in ACE stock began Sept. 9 in the over-the-counter market, closing at $18.63 (U.S.), or about $24.17 (Canadian), on volume of 59,500 shares. In total, 189,500 shares have traded since Sept. 9.
History tells us that nimble investors, no matter what their long-term views, could post short-term trading gains in ACE.
In March, 2003, US Airways Group Inc. emerged from its first filing for bankruptcy protection, and when its shares began trading on Nasdaq last October, lo and behold, there was a brief but impressive rally.
Air Canada saw its share price temporarily weaken to less than $8 after it acquired Canadian Airlines International Ltd. in early 2000, but then rocket up to a record $21.50 in May that year.
It's unclear whether the feel-good novelty of ACE will quickly wear off, but ACE appears set for takeoff from its base price of $20.
How come we all missed this one?
Yes investors, there is an airline with rising shares
John Heinzl
00:00 EDT Thursday, September 23, 2004
Owning shares of an airline is a quick way to go broke, but here's one carrier that's soaring away from the pack: World Airways Inc. Never heard of it? That's because the specialty airline flies below the radar of most investors, hauling U.S. military personnel, sports teams, cargo and leisure travellers on its fleet of 16 wide-body aircraft.
Yesterday, the shares surged $1.60 (U.S.) or 39 per cent to close at $5.67 on the Nasdaq Stock Market, after World Airways hiked its guidance for the third quarter ended Sept. 30, citing higher-than-expected revenue from its contract with the U.S. Air Force Air Mobility Command.
The Peachtree City, Ga., company, which derives 80 per cent of its revenue from the military and is the largest private carrier of U.S. troops, said it expects operating income of $11-million to $13-million for the quarter, up from a previous estimate of $5-million to $7-million. Conflict has been good to World Airways. During the Vietnam War, it airlifted military personnel and supplies across the Pacific and ferried battle-weary soldiers on rest and relaxation visits to Japan and Australia.
When the U.S.-led coalition invaded Iraq, it was the first private U.S. carrier to fly into Baghdad, where it delivered medical supplies. The shares are up about 700 per cent since the Iraq war started. Military personnel aren't its only customers.
World Airways is the designated carrier for two National Football League teams, the Buffalo Bills and Jacksonville Jaguars. And until a few years ago, it operated annual flights for Muslim pilgrims from Indonesia, Malaysia and other countries to the Islamic holy land in Saudi Arabia. However, it no longer offers that service, because the threat from terrorists in the Middle East made the flights too risky, company spokesman Steve Forsyth said.
I only had 20k with a low 20's average which I sold just above cost. I'll hit the Scotch it actually opens at $1. <VSG>
Just for fun ...
Check out preopen LAM.V
Nuts!
I am not laughing at all since I missed out on the Stelco bounce.
I did play NT sub $1. The big difference: NT wasn't in Chapter 11. I still remember Laidlaw and those aren't good memories ...
Thanks Bruce.
Somehow the third reboot worked. Go figure ...
kidl
OT - STE ... Apparently some "nut" on ROB TV called Stelco a Buy yesterday.
I wonder how many shares he needs to get rid of ... LOL
IVAN on the move
Good morning.
My wife just called me. She is on the road and her notebook (XP Pro) is not powering up. She gets to the blue “Welcome” screen but no further. Powered down twice. Same problem. Can’t get to the task manager either.
Any ideas what she should do?
TIA
kidl
STE ... Yup, a short term opp for hard core gamblers <g>
OT - Kasttle: You are no fun to argue with. LOL
Much to my regret I don’t have children but I did ”inherit” a very large family trough marriage. I sort of (not really) lost count on the nieces and nephews and the next generation is just around the corner …
It’s not the schools that make kids “tick”. It’s the parents.
Just like it’s not the government’s responsibility to look after our parents. It’s our responsibility.
But enough of that …
kidl
PS: Even more OT … Have a look at T.VRS. It’s an equally “sad” story but a potentially “good” story in terms of our PF’s considering current events.
Just the 2 cents from a frequent lurker. Great thread BTW.
Wouldn’t we be better off to spend our (limited) education dollars on basic skills instead of allowing kids to drop basic subjects while accommodating them with what they are interested or good in – even if it’s outside regular hours? Basic math, English, geography, history amongst others come to mind as “musts”
I have employed grade 13 students who couldn’t spell or do basic math without a calculator. Limited choices are good but a good basic education goes a lot further.
Let them make choices once they are old enough to have a (faint) idea where they are heading and let parents pay for extras alongside of a solid basic education, just like they have to at the college or university level. It’s a cost of doing business; i.e. having kids.
Many more years ago than I care to remember I was forced into Latin in grade 5. Why? Because it provided the base for the then important languages; the Roman languages. Then came French (Spanish was an option) and English as mandatory subjects in grade 8 right up to grade 13. I didn’t like it or understand the relevance then but I sure understand it now.
You want your kids to be ahead of the crowd, you will have to pay for it. It’s a lot like investing in stocks. The big gains usually come from “futures”. Our kids are no different. Who else will pay for general retirement benefits and health care costs?
Cheers and Regards,
kidl
OT - Swami: Judging by Q2 results Heller does not hold the winning hand and I am afraid Target is well aware of that.
They can wait. Can HBC?
M666, you around?
Any chance you can look at VRS.T?
I love the company / industry but don't like what I see in the chart.
TIA
kidl
Swami: Did you listen to the HBC Q2 conference call?
If you didn't, you should. The Q&A portion is interesting.
The conference call will be archived and can be accessed by dialing
(416) 640-1917 in Toronto or 1-877-289-8525 outside of Toronto and entering the following pass code: 21056329 (pound key). This archive will be available until midnight October 31, 2004.
Yes, Heller is a nice guy. He is also a very good salesman when it comes to selling himself.
He talks about humongous increases in sales while cutting back open to buy budgets in most departments. Zellers is doing $110 per sq ft while Wal-Mart is doing $270. He better sell this thing fast because Zellers will drop below $100. At that point the whole kit and caboodle will be auctioned off on eBay for 50 cents on the dollar. LOL
Heller is still there. He is busy figuring out what to do with his capital gains and the income tax he faces on his going away present.
Question: Did VRS.T finally fill the gap yesterday?
Nice jump today on good volume.
RS: Thanks x 2
US 860 Mil equates to approx. Can 16 per share
RS, from your mouth to God's ear. LOL
Institutions ... Who besides Zucker has a sizable position?
Naaa, not the only believer. Just the one with the higher expectations. 11 to 17 or 18 will do wonders for the old RRSP <vbg>
RS: $19+ would be nice but I don't think so. Book doesn't matter in this case since it's not relizable. Breakup value IMO is between 22 and 24. Minimum discount to BUV would be 20%. My guess is somewhere around 18.
We shall see ...
HBC.T should be interesting ...
http://www.globeinvestor.com/servlet/ArticleNews/story/RTGAM/20040812/wxtarge0813
IBM also holding off with SP2
http://zdnet.com.com/2100-1104_2-5302346.html
"Donated" half my OIL 3.30'ish.
The rest is for sale above 5.
Fridays can be good. <g>
What internet connection do you have at home?
Thanks Susie.
How would you rate the remote speed from a (hotel) dial up connection?
Is anyone familiar with this service?
https://www.gotomypc.com/
If so, how does it compare to PC Anywhere?
Thanks
kidl
PC World SP2 write-up:
http://www.pcworld.com/reviews/article/0,aid,116996,pg,1,00.asp
And here I thought hide and seek was a kids' game. Unreal ...
Thanks
Thanks ... One more question if I may ...
What would you then read into House #1 being a net buyer? I.e.VRS
Ex House Bought $Value Ave Sold $Value Ave Net $Net
T 1 Anonymous 362,700 1,779,364 4.91 217,500 1,068,927 4.91 145200 -710437
VRS.T coming back into play?
Question - No rush ...
Can anyone explaint to me what this TSX House #1 (Anonymous) is all about?
Thanks
kidl
Reasonable unless it's painted "Schwartz"
What's your HBC target?
COB.A ... Me too while I was out. Probably not a DT for me.
How about you, Chief?
Why not play AC instead of Stelco? AC has much nicer swings and the risk is the same. Both are worth zero ...
Why not play AC instead of Stelco? AC has much nicer swings and the risk is the same.
VRS ... You may have overlooked what I overlooked.
They have a 16 Mil. LOC and over 18 Mil of warrants / options which are in the money.
Recent blocks / crosses around the $5 mark lead me to believe that they will not go back to the trough at this point.
Can someone give me an opinion on VRS.T?
Not looking for a DT but looking to add to LT account.
TIA
kidl