2014 Investor Day presentation

[jcw]

actually market cap wouldn't at this point as there is still risk with AA as it has integration to do - so there would be no way it would be more valuable than DL at this point
 
but glad you have now switched to market cap - amazing how you twist and turn
 
Let's recap:
 
You claim outstanding revenue performance - they are the same
You claim better balance sheet performance - you lose here AA has higher ROA
You claim AA is not accounting for taxes - you post how DL has been riding loss tax forwards since say 2008 through 2013 and AA is now doing the same thing so has the advantage over DL
then you went to market cap - agree DL is higher there
yearly performance in stock price grow - AA 24% - DL 19% - so the market is rewarding AA with better growth - so your debunked again!

 

[WorldTraveler]

no, you THINK revenue is the same. It is not.

go read financial statements and you will see the numbers.

Balance sheet is not defined by one statistic - on either side.

Return on assets is ONE statistic. AA"s debt esp. in the future is far higher than not only DL but also other airlines in the US including AS, WN, and UA. IN an industry that has a long history of not even covering the cost of capital, most analysts recognize that debt is not a good thing.

AA's ROA now is a reflection of its strong revenue performance which itself is weakening. AA got a big bump in the domestic market because of the end of US' pricing policies but AA's RASM in every segment has been weaker than the industry as a whole.

Stock price growth only reflects where a carrier was vs. where it is now.

53 weeks ago, AA was in BK. it isn't hard to see why AA's stock has growth - but growth doesn't reflect absolute numbers.

AA is doing a good job where it is now. Parker did the same thing at US.

What new AA hasn't done and Parker ran out of steam trying to do at US was build long-term financial strength.

Let's compare where AA is when the merger is completed - and DL has marched further down the list of its strategic initiatives - and when WN has moved into Latin America and built out DAL etc.

AA is still very much in the honeymoon phase of being a post BK airline. Maybe they will succeed long-term but no one has come anywhere close to arguing that AA is anywhere close to the same league as AS, DL, or WN in terms of long-term financial success.

Lots of hope - but far from certainty what will actually be delivered.

you completely

 

[jcw]

wait let me get this - so DL had revenue of 11,178 and AA 11,139 in the latest quarter if you say DL has superior revenue performance it's not there
 
So let's compare the number any arm chair analyst would use to measure balance sheet performance - again that would be ROA - sorry dude DL loses again
 
Then you start a thread talking about DL's performance - if you were truly analyzing the article correctly you would have said this:
 
DL is performing extremely well and US almost matched DL's performance so as AA implements US methods of running the airline AA will rival DL's performance however you can't ever bring yourself to say something positive about another airline

 

[WorldTraveler]

Revenue performance in companies of different size refers to the amount of revenue per unit of production.

IN the airline industry, it is called Revenue Per Available Seat Mile.

get over your grudge. If AA or anyone else delivers revenue on par with DL or any other airline, everyone will know it - and AA's financial metrics will show it.

 

[Kev3188]

So let's compare the number any arm chair analyst would use to measure balance sheet performance - again that would be ROA - sorry dude DL loses again

RASM...CASM...PRASM...

Doesn't matter which one you want to talk about; none of it matters. All the upheaval AA'ers are going through with BK, the merger, etc. is all for naught. LatAm is toast. The TPAC flying is toast. The A319Ts (or whateverthef**k the transcon ones are called) are toast.

It's all futile... Just ask.

 

[WorldTraveler]

or maybe DL really does have the highest RASM among US carriers, the lowest CASM among the network carriers, and is managing to grow Latin America and LHR while keeping its RASM growing faster than what any other carrier is doing.

whether you want to hear it or not, Kevin, DL has been recognized by the investment community for its ability to generate revenue better than other carriers are doing.

DL simply does not have the number of revenue threats to its network that AA does; in fact, no other carrier faces the threat to its revenues that AA does with competitive growth in DFW/DAL, Latin America, and LHR all the while AA has a longer and deeper track record of losses in Asia than any other carrier does in any other global region.

AA came out of BK and with the merger having large RASM increases because of the end of US' pricing policies which were identified by the DOJ as major concerns it had and which precipitated the slot divestitures which are just now beginning to result in new service by other carriers.

As a result of the strengthening dollar and AA's lack of currency hedges, AA's revenue growth on a system basis in recent months has been weaker than other US carriers. those are realities.

It is not my intention to soft pedal reality to avoid talking about the threats that AA or anyone else faces.

As much as some want to harp on fuel hedges as being a threat to DL or other carriers, the difference in revenue between the big 3 amounts to just a few percent. Differences in major market revenue production for any of the big 3 is more than enough to swing the needle in total profits from one carrier to another.

and we haven't even seen the full impact of AA's new labor agreements or merger costs on AA's financial results.

 

[Kev3188]

whether you want to hear it or not, Kevin, DL has been recognized by the investment community for its ability to generate revenue better than other carriers are doing.

I don't need to hear it; I help create that reality.

 

[jcw]

and we haven't even seen the full impact of AA's new labor agreements or merger costs on AA's financial results.

 
So now you are implying AA will be paying it's employees too much - so now AA employees will be paid better than DL - wow I guess that profit sharing is not as lucrative as you have been claiming
 
Glad the AA employees will be better off - amazing how you trash the AA unions for the agreements for not getting profit sharing then claim AA's new labor agreements will hurt AA profitability - remember how you kept pounding on AA for not having to "account" (using your incorrect term) for profit sharing
 
So which is it - AA will be more profitable because it does not have to "account" (once again using your term) or will AA be worse off because of it's labor agreements - you can't have it both ways
 
Everyone sit down and wait for the really, really long factually incorrect comments trying to get out of this wet paper bag

 

[WorldTraveler]

for someone that is so worried about how much I post, you say such spectacularly wrong statements that no one could leave them alone.

either you are simply looking for an opportunity to post and can't think of anything to say other than distort what someone else says or you really don't understand the conversation.

AA's profitability will have to be driven by revenue superiority. there simply is not enough of a difference between the costs that ANY of the big 4 have relative to each other to make a difference.

Hedge gains or losses whether for fuel or currency as well as labor cost differences don't overcome the differences in revenue generation.

AA's expected profitability for the current quarter on a margin basis is going to be slightly less than DL's based on public guidance from both companies - and both AA and DL will probably be roughly on par with WN in terms of margin performance but probably better than UA.

If costs mattered, that would not be the case. AA's supposed fuel hedge advantage (for lack of them) is being offset by lower revenue performance. IOW, DL's revenue performance is offsetting its fuel hedge disadvantage. That will likely be the case with WN as well.

If you would actually open a few financial statements for US airlines instead of jumping to conclusions that aren't even close to being supported by facts, I'd be happy to bow out of the conversation.

 

[jcw]

Oh so now their profitability will be from revenue performance - OK so you can stop posting about fuel, labor costs, etc and we will look at revenue exclusivity
 
It's amazing how you try to change the story line

 

[WorldTraveler]

no, the cost difference between the big 4 US airlines is not great enough to offset the revenue differences each have.

that doesn't mean costs don't matter.

it just means that revenue is a far bigger means by which the US carriers make or break their performance.

I have consistently focused on revenue. nothing has changed.

and if you don't think that to be the case, track AA's revenue performance relative to its peers and see if that has not been precisely the reason why AA did as well as it did in the first few quarters after the merger.

 

[jcw]

so now it's costs - which is it - you flip flopping
 
must be unhinged

 

[WorldTraveler]

no unhinged is anyone that doesn't understand that a company is run by both their ability to manage costs and revenues.


in the current airline industry, both are razor thin.

the differences that have translated into financial success of one company vs. another in the modern airline industry has been revenue production whether some understand that or not.

 

[jcw]

no kidding however you keep changing your arguments
 
its amusing how wrong you are on so many items which causes you to change story lines
 
Whose stock is up more this year hence wall st thinks is performing better - on right that is AA

 

[WorldTraveler]

AA was in bankruptcy 54 weeks ago. Of course they have strong growth in the last year.

that doesn't mean they are at the top or that they won't keep improving... they have shown remarkable improvement.
again I slight AA nothing. We can compare where AA is in a few years.

meanwhile the industry remains highly competitive.

the world is big enough for several strong carriers

as Kevin notes, DL leads the industry in revenue performance and part of the reason is DL's outstanding operational performance of which Kev is a key part