easyJet shares plunge...again
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easyJet shares plunge...again
Budget airline easyJet Plc lost over a fifth of its market value on Monday as it joined rival Ryanair in giving a bleak outlook amid rising fuel costs and a ticket price war.
EasyJet shares were down 21.17 percent at 158-1/4 pence at 0736 GMT.
EasyJet's latest stock-market woes come just a month after its shares plunged when it warned that a price war with rivals such as Ryanair would keep fares under pressure.
EasyJet shares were down 21.17 percent at 158-1/4 pence at 0736 GMT.
EasyJet's latest stock-market woes come just a month after its shares plunged when it warned that a price war with rivals such as Ryanair would keep fares under pressure.
NB: Just three months ago, the share price was nearly 350p - that´s a 55% fall. Is the stockmarket being too harsh?
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They don't need to surcharge- if necessary they can just make an adjustment to their 'floating fares' (fares set according to route and load factor and continually adjusting themselves). Why they don't hedge? I would guess it costs money. Sometimes you win and sometimes you lose. It's like insurance- look at the industry that has built up around that- all living off insurance premiums. Maybe we'd all be better off if none of us insures anything at all. If an industry lives off hedging premiums, maybe in the long run if you never hedge, you've unloaded yourself of that expense.
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first thing: don't rely on stock prices!
i still believe that easyjet has a distinct advantage over ryanair as they serve the big airports which might turn out to be a bigger advantage once traffic numbers increase. so why not buy easyjet now?
i still believe that easyjet has a distinct advantage over ryanair as they serve the big airports which might turn out to be a bigger advantage once traffic numbers increase. so why not buy easyjet now?
Saw Mo'L on CNN recently. Whatever people might think about him, he gave a very clear and firm description of his airline's way of avoiding the need for surcharges.
Bit arrogant to think that he still has a cat in hell's chance of overturning the Charleroi matter though.
Bit arrogant to think that he still has a cat in hell's chance of overturning the Charleroi matter though.
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PE ratio still in the clouds, so it is possible to drop even further in the medium term (I doubt it in the short term though). I suspect that Websters coments regarding over capacity in the sector have woken investors up to the fact that ezj and rya are the two biggest drivers of over capacity and that the ezj ambitious orderbook could cost it dear in the long term.
Its just a good job share options are not a replacement for the ezj loyalty bonus.
Its just a good job share options are not a replacement for the ezj loyalty bonus.
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Knee-jerk reactions in many cases. When you invest in airlines (I wouldn't personally) you've done your research into how the airline industry works, and you know what is likely to yield a reasonable return over the LONG TERM.
As many have already commented, many low-cost airlines won't make it through the next year or two. However, if I had to put my money somewhere, I'd be willing to bet on easyJet and Ryanair being around in 5 years' time. They've built up the size, brand recognition and have sussed-out the main markets. Looking at the broad (and long-term) picture, I reckon they both have a future.
I can't say the same for the other low-cost carriers, many of whom don't publish results and are likely to be losing large amounts of money.
In short, many investors don't know an awful lot about the industry, or the airline companies they invest in. Those that avoid investing in airlines altogether are probably more on the ball in any case.
As many have already commented, many low-cost airlines won't make it through the next year or two. However, if I had to put my money somewhere, I'd be willing to bet on easyJet and Ryanair being around in 5 years' time. They've built up the size, brand recognition and have sussed-out the main markets. Looking at the broad (and long-term) picture, I reckon they both have a future.
I can't say the same for the other low-cost carriers, many of whom don't publish results and are likely to be losing large amounts of money.
In short, many investors don't know an awful lot about the industry, or the airline companies they invest in. Those that avoid investing in airlines altogether are probably more on the ball in any case.
Voeni, please elaborate!
Paxing All Over The World
Zulu: Is the stockmarket being too harsh?
Only if you think that they are there to invest in companies to ensure the companies long term survival! The stock market is a simple open gambling pen. Everyone hopes to make money by taking best on the future. When aspects of the future change, they change their bets and that is what has happened today.
Another key factor is that the young men and women now making the bets have not experienced a fuel crisis before!
Lastly, I reckon that EZY is being more open and honest than some. They have said what the risk is and so their price falls. MoL has the identical risk and he will say nothing unless forced to and his price will not go down. At least, not today.
Only if you think that they are there to invest in companies to ensure the companies long term survival! The stock market is a simple open gambling pen. Everyone hopes to make money by taking best on the future. When aspects of the future change, they change their bets and that is what has happened today.
Another key factor is that the young men and women now making the bets have not experienced a fuel crisis before!
Lastly, I reckon that EZY is being more open and honest than some. They have said what the risk is and so their price falls. MoL has the identical risk and he will say nothing unless forced to and his price will not go down. At least, not today.
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I was having a conversation in the hotel bar last night and we were discussing what the market place would look like in 5 years time or so and one thing what we all thought was that BA would snap up Easyjet when the price is low, not now but in a few years time, I know that I’ll get shot down for this, but I put a small bet on it if I could.
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Im holding on to my options as Ray said that the shares will be going towards £10 a share after the Go takeover and I know with that 3 day week of his he'll turn things round soon.And what a shame it would be to lose such a charismatic leader from the industry.
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There are a lot of airlines in Europe and America who would just love to be predicting a £50m+ profit pre-tax for the year in the current conditions. I am backing easyJet all the way to make it.
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Anyone betting on a change of leadership?
I wonder if she is getting bored?
