AMR Hits Yet Another 52 Week Low

[WingNaPrayer]

AMR stock dipped another 8.05% so far today, bringing in another 52 Week low record as the stock struggles to escape the $12.00 mark.

Shares in AMR have fallen nearly 74% since this same time a year ago, when shares were selling on the open market at $41.00

The company is slated to release it's 4th quarter and annual financial information on January 16th at 2:00 PM EST. Broadcasts will be available on the AA.com website under investor relations:

LINK

NOTE: Link will not be active until after the announcements are made and AMR uploads the teleconference and webcast to their site.

BTW: Any hopes of profit sharing for fiscal 2007 are all but officially dust in the wind!

 

[Veritas]

AMR Hits Yet Another 52 Week Low...

AMR is not alone.

Airlines lose altitude as crude climbs
Major carriers hitting full-year lows amid sector sell-off

NEW YORK (MarketWatch) -- Airline stocks took a beating Tuesday as a roster of major carriers hit new 52-week lows, a retreat coinciding with higher crude-oil futures as well as concerns about faltering consumer spending.

 

[FWAAA]

Even though every legacy is hitting 52 week lows today, the group of airlines whose stock is actually UP on the day includes XJET, Mesa, MAIR and Great Lakes. What do they all have in common? They don't pay for a majority of their fuel - it's paid for by their legacy partners as part of the cost+ capacity purchase agreements. And the biggest one of all - Republic - is down slightly yet is still near its 52 week high.

Yet despite this, Arpey wants to divest Eagle so AA can begin paying real profit to someone else for regional feed instead of getting it for cost (as it does now).

AMR's total regional revenue is gonna be about $2.5 billion. Assuming (for purposes of illustration) that Eagle's portion is $2.3 billion of that (the other $200 million is American Connection at STL) and that Eagle's costs were $2.2 billion, a 10% margin to independent Eagle owners would mean $220 million out the door in profit to those new owners. At an 8% margin (somewhat on the low end), it would still equal $176 million.

If Arpey is still hell-bent to divest Eagle, I hope AMR realizes a big pile of money on the front end to help pay those profits to the new owners.

 

[WingNaPrayer]

I'm still betting AMR will be 8 bucks and some change by Spring. At this rate, could even be lower.

 

[Veritas]

I'm still betting AMR will be 8 bucks and some change by Spring. At this rate, could even be lower.

My be so, but several other airlines were bigger losers today.

From the MarketWatch article linked above:

Shares of UAL Corp. (UAUA 24.39, -4.79, -16.42%) traded off 16.4% to close at $24.39 after hitting a 52-week low at $24.23, followed by Continental Airlines (CAL 17.84, -2.49, -12.2%) , closing down 12.3% at $17.84 after hitting a yearly low of $17.79. Delta Airlines (DAL 11.77, -1.62, -12.1%) lost 12.1% to $11.77 after striking its one-year low of $11.50.

It was a similar story for AMR Corp. (AMR 11.74, -1.55, -11.7%) , shares of which skidded more than 11% to close at $11.74 after hitting a new full-year low at $11.70.

 

[WingNaPrayer]

But you notice THE OTHER CARRIERS will be paying THEIR employees profit sharing, in huge amounts the way it looks.

What will AA employees get?

Hmmmmmm.

 

[Connected1]

What will AA employees get?

Exactly what was agreed and ratified in 2003?

 

[FWAAA]

But you notice THE OTHER CARRIERS will be paying THEIR employees profit sharing, in huge amounts the way it looks.

What will AA employees get?

Hmmmmmm.

The other airlines are just getting around to distributing profit sharing to their employees? Sorta late to the game.

The nonmanagement employees of AA received their vehicle for their profit sharing on May 1, 2003: Options on 35 million new shares of AMR that were in the money the following week and at their peak, late in January of last year, represented approximately $1.26 billion of profit ($41 share price minus $5 strike price = $36 profit per share multiplied by 35 million shares = $1.26 billion). How's that compare to the profit sharing CO has accrued so far?

Sadly, the value of AMR has plummeted since late January, 2007, greatly reducing the value of the stock distributed to the employees.

Get back to us once any other airline distributes anything approaching a billion and a quarer to its employees.

 

[WingNaPrayer]

Today, the stock bottomed out at yet another 52 week low of 10.95. It should be in the single digits by the end of the week.

That means your 1.26 billion in value is now just under 200 million, which is more in line with what other carriers are doing. The 5 dollar strike price doesn't take into account the brokerage fees, and the taxes charged against any such sale. As you can figure, the 10.95 minus the strike price of 5 dollars and minimum, minimum fees and taxes gives that stock a value of about 1.70 Yeppers, now any employee can buy that condo in Puerto Vallarta right next door to Arpeys!

Sure, AA forked over some free stock, but the actions of the board, CEO, and management in general also wasted no time in driving that stock value straight into the crapper!

There is a raging battle on the back burner. AA can scream bankruptcy all they like, this time they'll have to do it. The shame is, no bankruptcy judge has the cajones to reverse board actions and go after that BK protected golden parachute corporate has stuffed for itself. It had 42M in it when Carty got caught - - how much do you think it's worth now?

 

[Nor'Easta]

Today, the stock bottomed out at yet another 52 week low of 10.95. It should be in the single digits by the end of the week.

It closed at 11.84 today :blink: .

 

[WingNaPrayer]

It always rebounds. Look at the loss for the day. It opened at 12.19, then dipped to 10.95 before rebounding to it's closing price. So it dipped a buck and a quarter for the day which is a lot when you look at the overall price. Even though it rebounded, it only gained 35 cents overall.

Yes, most legacy carriers are experiencing this right now and no doubt fuel is a big part of that problem. Yet every analyst that discusses AMR always mentions AA's "looming labor problems" and those are the key words investors don't like to see. Sometimes it's better to take a loss and just get out, which is what a lot of investors have been doing this week. They are all shedding their portfolios of transportation stocks.

 

[eolesen]

I know that doesn't do much for your vendetta against AMR, but for the record, most airline stocks hit new 52 week lows either yesterday or today, including AAI, AMR, CAL, DAL, JBLU, LCC, LUV, NWA, and UAUA.

The fact that most analysts now agree that the economy is in full recession probably is lost on you as well.

Or perhaps that's Arpey's fault, too?....

That means your 1.26 billion in value is now just under 200 million, which is more in line with what other carriers are doing.

Nice try, except that you don't take into account how many of those shares were cashed in. I doubt too many people held onto their shares once it broke $25 on the way up. Some held on into the $30's and $40's, and I doubt too many held on when it started to drop again...

Sure, AA forked over some free stock, but the actions of the board, CEO, and management in general also wasted no time in driving that stock value straight into the crapper!

You really don't look much beyond the axe you want to grind....

From 2003 to 2006, the actions of the Board, CEO, Management and Employees brought that stock up from being worth less than a Happy Meal to a pretty nice steak with trimmings and a cocktail at Flemings or Del Frisco's. Only CAL has improved in value more from 2004 to 2006.

So, piss and moan about the 52 week low all you want. The country is now in a recession. Hope your 401K's are balanced to weather it out...

 

[WingNaPrayer]

Thanks for your permission. I'm fairly certain that it will hit yet another 52 week low tomorrow :bleh:

 

[eolesen]

And if it does, it gets that much closer to where I might consider buying back into it... at $4 a share. If I lose a couple hundred bucks, so be it. But I might stand to make a couple thousand in the process, too....

 

[Bob Owens]

The other airlines are just getting around to distributing profit sharing to their employees? Sorta late to the game.

The nonmanagement employees of AA received their vehicle for their profit sharing on May 1, 2003: Options on 35 million new shares of AMR that were in the money the following week and at their peak, late in January of last year, represented approximately $1.26 billion of profit ($41 share price minus $5 strike price = $36 profit per share multiplied by 35 million shares = $1.26 billion). How's that compare to the profit sharing CO has accrued so far?

Sadly, the value of AMR has plummeted since late January, 2007, greatly reducing the value of the stock distributed to the employees.

Get back to us once any other airline distributes anything approaching a billion and a quarer to its employees.

Stock options that were paid for at the equivelent rate of at least $300/share in concessions plus the $5 strike price is not profit sharing. Its a poor investment with a varible, but guaranteed, loss.