Stock Market Wrap & Airline Earnings on Tap
This article offers a video and brief written wrap up of the day's activity, and a summary glance at some important earnings reports on schedule for Tuesday morning.
(This article should interest readers of NYSE: AAI, NYSE: BAC, Nasdaq: JBLU, Nasdaq: UAUA, AMEX: DIA, AMEX: SPY, Nasdaq: QQQQ, AMEX: DOG, AMEX: SDS, AMEX: QLD)
The opinions expressed within the video may not agree with the views of Wall Street Greek.
Stock Market Wrap
What happens to a bird that swallows a mosquito infested with the larva of parasites? Probably the same thing that happened to Bank of America (NYSE: BAC) I suppose. Saving Countrywide Financial may yet kill BAC. We're exaggerating, but the pain to own this leader in the facilitation of home ownership is proving hard to bear at the moment. Maybe we'll all laugh about this when the housing market is back to its normal growth patterns and Bank of America is sitting pretty, but it's sure hard to envision that at this point isn't it...
That the market once again held up despite the worse than expected report from BAC, was like Rocky Balboa calling on Apollo Creed to keep it coming. They say life is not about how hard you can hit, but how much you can take and keep moving forward. If that's true, than yours truly is one tough mother.
Earnings on Tap
Of the slew of earnings reports scheduled for Tuesday, we tried to pull out a handful of the most interesting ones due for morning reporting.
Considering that airlines keep turning belly up, or merged with their neighbor, you should be interested in the reports of a few airlines on Tuesday. The funny thing about the situation in the airline industry is that you can't make heads nor tails of how to play the group. Unless you are the shrewdest of analysts, and have close and friendly relationships with management, you could be handed your head. A company you peg for bankruptcy could prove a synergistic addition to some other industry participant's plans, or vice versa.
AirTran Holdings (NYSE: AAI) moved its conference call back a day, perhaps due to a flight delay? AAI investors better hope it's not due to a flight cancellation. I can just see the CEO telling the Investor Relations Chief, change the word "disaster" to "difficulty" and "recession" to "contraction." That's the new English folks!
The analyst community of four (with estimates) has grown increasingly sour on this one, as the consensus estimate has deteriorated by twenty-two cents over the course of the last ninety days, and now stands at a loss of $0.31 for the March quarter. The rest of the year has not moved counter to trend, and the full year '08 figure is now deep in the red also, at a per share loss of $0.44, according to Thomson Financial. Yikes!
AAI's price-to-book is about 1-to-1, but what matters more than any value indication is which way book value is headed and at what rate. Who cares what the P/B is when book value is disappearing. Debt stands at over two times equity, and EBITDA-to-interest is at 2.8X based on '07, and guess what, debt is growing (so it should not improve). I do not know this company intimately, but a quick look at the numbers says "watch out" to me. Just a thought... Of the few brave souls who cover the company, probably because they have to, most look asleep with a hold rating, while a couple are real rodeo stars with buy ratings. There's a big short interest and the stock chart says head for the hills. Some would say the short interest offers reason for optimism, but I would not be playing roulette with this one.
Also on the earnings slate for Tuesday are JetBlue (Nasdaq: JBLU) and UAL Corp. (Nasdaq: UAUA). That's all for now folks... I'm tired.
Please see our disclosure at Wall Street Greek.
(This article should interest readers of NYSE: AAI, NYSE: BAC, Nasdaq: JBLU, Nasdaq: UAUA, AMEX: DIA, AMEX: SPY, Nasdaq: QQQQ, AMEX: DOG, AMEX: SDS, AMEX: QLD)
The opinions expressed within the video may not agree with the views of Wall Street Greek.
Stock Market Wrap
What happens to a bird that swallows a mosquito infested with the larva of parasites? Probably the same thing that happened to Bank of America (NYSE: BAC) I suppose. Saving Countrywide Financial may yet kill BAC. We're exaggerating, but the pain to own this leader in the facilitation of home ownership is proving hard to bear at the moment. Maybe we'll all laugh about this when the housing market is back to its normal growth patterns and Bank of America is sitting pretty, but it's sure hard to envision that at this point isn't it...
That the market once again held up despite the worse than expected report from BAC, was like Rocky Balboa calling on Apollo Creed to keep it coming. They say life is not about how hard you can hit, but how much you can take and keep moving forward. If that's true, than yours truly is one tough mother.
Earnings on Tap
Of the slew of earnings reports scheduled for Tuesday, we tried to pull out a handful of the most interesting ones due for morning reporting.
Considering that airlines keep turning belly up, or merged with their neighbor, you should be interested in the reports of a few airlines on Tuesday. The funny thing about the situation in the airline industry is that you can't make heads nor tails of how to play the group. Unless you are the shrewdest of analysts, and have close and friendly relationships with management, you could be handed your head. A company you peg for bankruptcy could prove a synergistic addition to some other industry participant's plans, or vice versa.
AirTran Holdings (NYSE: AAI) moved its conference call back a day, perhaps due to a flight delay? AAI investors better hope it's not due to a flight cancellation. I can just see the CEO telling the Investor Relations Chief, change the word "disaster" to "difficulty" and "recession" to "contraction." That's the new English folks!
The analyst community of four (with estimates) has grown increasingly sour on this one, as the consensus estimate has deteriorated by twenty-two cents over the course of the last ninety days, and now stands at a loss of $0.31 for the March quarter. The rest of the year has not moved counter to trend, and the full year '08 figure is now deep in the red also, at a per share loss of $0.44, according to Thomson Financial. Yikes!
AAI's price-to-book is about 1-to-1, but what matters more than any value indication is which way book value is headed and at what rate. Who cares what the P/B is when book value is disappearing. Debt stands at over two times equity, and EBITDA-to-interest is at 2.8X based on '07, and guess what, debt is growing (so it should not improve). I do not know this company intimately, but a quick look at the numbers says "watch out" to me. Just a thought... Of the few brave souls who cover the company, probably because they have to, most look asleep with a hold rating, while a couple are real rodeo stars with buy ratings. There's a big short interest and the stock chart says head for the hills. Some would say the short interest offers reason for optimism, but I would not be playing roulette with this one.
Also on the earnings slate for Tuesday are JetBlue (Nasdaq: JBLU) and UAL Corp. (Nasdaq: UAUA). That's all for now folks... I'm tired.
Please see our disclosure at Wall Street Greek.
posted by The Greek | 12:30 AM
2 Comments:
Dude... stop trying to call a bottom. And stop this nonsense of resiliency. You used to be very legit, now you sound like another run of the mill analyst with some "interests" in mind, be keep client relationships, win business or what have you. Anyway, ever since your personal investment vision got in the way, I lost total interst in this page. See ya later Greek, hopefully you'll stop being just another analyst.
One of the faults we often make in society is in our generation of assumptions regarding the purposes and interests of others. We cannot possibly really know what others think and plan. When we act based on our own opinion, we are just as likely to act wrongly as we are to act correctly.
Be sure that I do not write one single word based on any other purpose but the truth. You talk about my "personal investment vision," and I'm not quite sure what you mean. If you think I am pushing a market opinion based on personal investment, you are greatly erred in your view of my character. Also, it would be nice if I was that powerful or that widely ready that I could move the market.
If you mean my business objectives, I hope you do not think I should give up the pursuit of happiness and financial well-being to serve the greater good... I'm not the Mother Terresa of financial advice. I do hope to survive only, and to help others with the excess. So far through this effort, I've made great sacrifice, and this work continues to reach you at great cost to me.
My purpose is to be a true independent voice, and one that can offer high quality, valuable ideas. I tell it like it is, and most permabulls did not want to hear it last summer, and now permabears don't want to hear it.
So, will I find any friends being the voice of reason? That's not my goal either. In the end, hopefully you will see that I was a stable voice while the herd ran in panic, just as I was the stable voice when the herd was full of greed.
Is catastrophe possible? Certainly, because our society is overlevered, but I believe we need another catalyst to get there, and you do not forecast that catalyst. I warn of it though.
I'll continue to do my best, and I hope you keep reading. I'm just sharing my opinion. If you only consider me "legit" when you agree with me, then you are looking for "yesmen" and I'm not one of those either. God bless, and no hard feelings. I'll do my best for you.
Markos
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