Goldman Sachs Comments On Us Airways

[USA320Pilot]

Goldman Sachs comments on US Airways

UAIR: Reit In-Line - US Airways` yields remained under pressure in March, and we are revising our 1Q estimate to a loss of $3.65 from a loss of $3.20, our full year 2004 estimated loss to $8.00 from $6.75, and our 2005 estimated loss to $5.25 from $4.25. Our estimates do not include additional labor concessions, which appear likely, and we maintain our In-Line rating in the context of our Attractive Sector view.

LABOR LIKELY TO GIVE, BUT WILL IT BE ENOUGH: Because of their power to strike, labor unions at airlines secure a disproportionate share of airline wealth during good times, but to protect their livelihood, labor provides a cushion in bad times. We believe unions will again step up with concessions in order to prevent US Airways from falling back into bankruptcy, but we question whether the savings will great enough to permit US Airways to be healthy and not just survive.

CRITICAL LABOR TALKS AS LUV ENTERS PHILADELPHIA: US Airways enters critical labor discussions in the spring just as LUV embarks on its introductory service and rapid expansion into Philadelphia, UAIR`s most profitable hub. With $1 billion in cash and the potential for several hundred million more in labor savings, we believe investors underestimate US Airways` staying power.

 

[shaka]

As I mentioned in another post, Goldman has money in this dog stock at $ 7.00 a share. They are going to continue to support this stock.

Glenn Engel, the analyst at Goldman, put out a report on United when it was $ 11.00 a share and look where that dog is now. Ask any other analyst who doesn't have a vested interest in US Air and they will tell you to run away from this stock. All of the other anaylst on the street who cover this canine have a "sell" rating on this puppy.

These reports are nothing but a bunch of hype!!!

 

[MarkMyWords]

What I find interesting is that all they address is the labor concessions. No where do they talk about structural changes or changed business plans. So our profitability is all on the shoulders of labor? :angry:

 

[700UW]

Sounds like it Mark, and if you look at history, this place is doomed, no airline has ever been saved off the wallets of the employees.

It takes a plan, vision and a strong, charismatic leader, and that is not dave siegel

 

[insp89]

As I mentioned in another post, Goldman has money in this dog stock at $ 7.00 a share. They are going to continue to support this stock.

Glenn Engel, the analyst at Goldman, put out a report on United when it was $ 11.00 a share and look where that dog is now. Ask any other analyst who doesn't have a vested interest in US Air and they will tell you to run away from this stock. All of the other anaylst on the street who cover this canine have a "sell" rating on this puppy.

These reports are nothing but a bunch of hype!!!

Let me guess, You're one of the many stock traders that stand to gain if those darned airline employees will just cooperate and take ANOTHER round of concessions for the team..You need to get off this "crisis creation" kick and get the Dave's "kick started" into doing the things that they can do RIGHT NOW , such as rolling the hubs, adjust the FARES, consolidate facilities. I'm sure you realize the only thing that stood in the way of a PROFIT vs. a LOSS last quarter was FUEL...U was not in the position to HEDGE while Southwest was HEDGED somewhere around 60-80%..

 

[shaka]

First and foremost, I am not a stock trader in this company and have absoulutely zero to gain if the stock goes up. I am a frequent flyer who has seen this company been dragged through the fire because of lame management The company is in serious trouble and everyone who follows the industry will tell you that this company is in horrible shape.

Secondly, fuel was a minor factor in the horrendous quarter. You need to go through the numbers and you will learn that even if they hedged they still would have lost a ton of money.

My recommendation to you is to go through the results line by line and make sure you understand the numbers before you post your opinions.

Good Luck!

 

[insp89]

First and foremost, I am not a stock trader in this company and have absoulutely zero to gain if the stock goes up. I am a frequent flyer who has seen this company been dragged through the fire because of lame management The company is in serious trouble and everyone who follows the industry will tell you that this company is in horrible shape.

Secondly, fuel was a minor factor in the horrendous quarter. You need to go through the numbers and you will learn that even if they hedged they still would have lost a ton of money.

My recommendation to you is to go through the results line by line and make sure you understand the numbers before you post your opinions.

Good Luck!

Fuel a MINOR factor ????? :blink: I suggest you take your own advice a look at the numbers YOURSELF.. If you have nothing to gain or lose due to this [dog] stock, Why are you Whining about it ?????

 

[700UW]

Tuesday, April 13, 2004

By Dan Fitzpatrick, Pittsburgh Post-Gazette



A tug of war within the pilots union is threatening to derail US Airways' detente with its most influential workers group and is endangering the airline's recovery plan.

"It's bad," New York airline analyst Ray Neidl, who covers US Airways, said yesterday. "I think the pilots have moved one step closer to being unemployed."

An angry faction of pilots ousted two members of the union's bargaining team Friday and replaced them with negotiators willing to take a tougher bargaining stance with the company.

The change was made by four union leaders from Pittsburgh and Philadelphia who have been arguing that rank-and-file pilots want "change" and that union negotiators have been in power too long and have made too many concessions to US Airways.

The new chairman of the negotiating committee, Doug Mowery, is a former union leader from Philadelphia who tried unsuccessfully last month to replace union chairman Bill Pollock.

The change comes only weeks before the company is expected to approach the pilots about wide-ranging concessionary talks.

US Airways Chief Executive Officer David Siegel, who has said he needs to cut $1.5 billion from the carrier's expenses this year if US Airways is to survive, wants labor negotiations to begin this month and new labor agreements in place this summer.

Analysts said yesterday that the pilots might have made a bad decision. The airline needs "flexibility" and "cost cuts," Neidl said. "They don't have a lot of time. They have got to get cost structure down pretty quickly."

The pilots thus far are the only group that has agreed to discuss its contract with management, so their internal struggles represent a "setback," said local airline observer Bill Lauer. "I can see lots of things beginning to unravel if something can't be done with the unions in a reasonable amount of time."

The resistance of some union members appeared to stiffen Friday following reports that put Siegel's 2003 compensation in the $8 million to $9 million range and even higher.

But the vast majority of that amount represented stock options that have no value because of the stock's low price -- it closed yesterday at $3.89, almost half the level necessary to trigger the stock options -- and restricted stock that won't start vesting until January.

Siegel's cash compensation for 2003 was $698,890, including a base salary of $600,000.

In an open letter to US Airways employees yesterday, Chairman David Bronner argued that Siegel's pay package was less than what many airline CEOs made last year and less than what Siegel was originally offered to work at US Airways in 2002.

Defending Siegel, Bronner pointed out that the unions have four seats on US Airways' board and thus share responsibility for approving Siegel's pay package. What's more, Bronner argued, is that Siegel had "preserved almost 30,000 jobs" since spring 2002 and defied the experts predicting US Airways' demise.

"We are still here, and we don't have any intention of going away. But we must deal with the changing economics of the airline industry," Bronner said.

 

[delldude]

subscribe to the dominoe theory soon.....

 

[shaka]

Just for your info the loss for the quarter was 98 million. You could have hedged till you were blue in the face, the quarter still would have been horrendous.

Please go over the numbers in details.

Good luck in your due diligence and sound analysis.

 

[etops1]

bad decision. were dead. get ready for the unemployment line. <_<

 

[Winglet]

It doesn't matter what the employees agree to. Siegel has no plan or he would have started implementing the 2 cent CASM long ago. Siegel is without a doubt the most incompetent corporate leader I've seen in a long time. It's astonishing to believe that this guy's last job wasn't selling shoes. And now, it doesn't matter what the losses are. Anything but a strong profit is going to be fatal real soon.

 

[700UW]

bad decision. were dead. get ready for the unemployment line. <_<

How is it a bad decision?

dave and his so called executives have proven they can't honor contract language and they can't run an airline.

You may want to throw your paycheck into a black hole, but others want accountablity!

Hey dave,

Where has over the $2.1 BILLION in concessions gone?

 

[cavalier]

bad decision. were dead. get ready for the unemployment line. <_<

Like it would have made a real differance either way....wake up

 

[FLYAWAY]

700UW,

Wasn't you along with PITBull who said "stay out of our contract" as it pertains to the IAM and AFA?