Virgin Blue share price

[Rick K]

Something appears afoot with VB -
shares have today shot up to 38c even after announcement of large extra share issue (which were only available to current shareholders at 30 June)
Is there an interested party - trading volumes have also gone through the roof
Anyone have any ideas?
bluex

[Michael Morrison]

Perhaps realising it is very cheap at the current prices and now they have some extra $$ in the bank they are not going anywhere in a hurry.

[NickN]

VB shares have been a great buy for a while. I have stockpiled a few myself.

[Marty H]

Was massively undervalued, the share equity at .20 cents a share and they have nearly doubled their money;)

[Greg McDonald]

QAN shares are doing the same...they've shot up sharply in the last 2 weeks to close today at 2.62

[Marty H]

Up nearly 8% today to 0.41;)

[Bruce Bramwell]

love the opportunity to purchase shares at 0.20!

[Chris W]

Rex shares over the last 2 days of the Nrth Qld announcement have shot up around 18%

[Mick F]

Errr, what North QLD announcement??

[Daniel M]

http://yssyforum.net/board/showthread.php?t=3773

[Rick K]

speaking of Rex - they were a reasonable shareholder of VBA (around 5% I think) and are a Singapore backed company. They sold their shares just before the share offer!
Is there another company (given the max 49% allowable overseas shareholding) Singapore based that may be buying the large number of shares that have since changed hands?
Virgin Corp. took up their share allotment - keeping them at 25% (or 29%- I'm not totally sure)
Hit 43c at one point today (back to 38 at end) but a lot of shares changed hands and all this after a nearly give-away share allotment!
(I must acknowledge I am a shareholder & very happy!! Bought in at 18c - took up the offer at 20c)

[Blair M]

http://www.asx.com.au/asxpdf/20090814/pdf/31k2vzc8mbwzrg.pdf

[Rick K]

Still trying to nut this out!
Shares now 51c with big volumes changing hands!
Does anyone have any idea who's buying??
Is there a merge or takeover on the cards?
Company capitalisation is now becoming quite attractive
Rick K

[Michael Morrison]

Look at QF as well. Their share price has been doing just as well. VBA was IMHO undervalued - this is just a correction as the economy is showing signs of improvement which will bode well for the airlines.

[Marty H]

Spot on Michael, was always massively under valued unfortunately the GFC effect pretty much all airline stocks, whoever jumped on those .20 shares during the equity raising is laughing now thats for sure:)

[Greg McDonald]

Airline stocks are taking a pounding today so far. QAN down .07 and VBA down .04 in early trade...the markets only been open for 30 minutes!!

[Bruce Bramwell]

it is across the board, WES down 0.50 WBA down 0.50

[Rick K]

A big drop in the last few trading days but I believe that they are seen as an "airline" therefore subject to the volcano shutdown
A good time to buy more as the Delta Joint Venture should be approved very soon!
Rick K

[Greg McDonald]

Virgin Blue shares are going very badly lately. VBA closed today at 0.58...down 4.4% just today and down a massive 18c from mid-March! Thats 23.6% lost value over the last month.:eek::eek:
I know other airline shares aren't going brilliantly but VBA seems to be dropping value at a dangerous rate lately. It would be interesting to know what is driving this dive in value.

[Nigel C]

A lack of bad news stories on Qantas for the past week?:p

[D Chan]

Virgin Blue shares are going very badly lately. VBA closed today at 0.58...down 4.4% just today and down a massive 18c from mid-March! Thats 23.6% lost value over the last month.:eek::eek:
I know other airline shares aren't going brilliantly but VBA seems to be dropping value at a dangerous rate lately. It would be interesting to know what is driving this dive in value.

perhaps investors trying to cash in, one thing is for sure they are not exposed to the chaos in Europe, unlike Qantas. Fortunately for both carriers a strong domestic market and the duopoly means both will remain profitable, which is clearly not the case elsewhere around the world be it Europe, Asia or North America where competition is fierce.

My bet on the shares is that it is inevitable VBA will eventually go back past 1 dollar. QAN probably belongs somewhere between the 3.20 - 4.00 mark.
What's more is that as we emerge out of the GFC into better times things will quickly pick up and earnings will improve.

As for explanations for recent falls - possible reasons include upward pressure on interest rates and trend of crude oil prices (regardless of the hedges)
http://www.aip.com.au/pricing/marketwatch.htm

[Rick K]

There has been a substantial sale of shares by an investment company called Paradice Holdings - some 20 million shares - notified to the ASX on 15th April in a "Notification of ceasing to be a substantial shareholder"
(see http://newsstore.fairfax.com.au/apps/previewDocument.ac?sy=smh&ss=SMH&docID=GCA01056077VBA&backTo%3Dhttp%3A%2F%2Fmarkets.smh.com.au%2Fapps%2F qt%2Fquote.ac%3Fcode%3Dvba%26submit%3DGo

From what I can gather Paradice Holdings picks up shares that are substantially undervalued (as VBA certainly were) then sells when they have achieved what they deem to be a reasonable (read high) return. They don't hang on to the shares after they reach their target regardless of the true value of the shares.

They may not yet have finished disposing of all their shareholding.

The share price will certainly recover when the Joint Delta Venture comes to fruition.

Rick K

[Anthony T]

Hi there

Notification to the ASX from both DJ & NZ regarding a possible commercial agreement on the Tasman routes.

[Greg McDonald]

Not good:

A LEADING brokerage house has slashed its profit forecast for Virgin Blue as it warns the airline is highly vulnerable to a possible oversupply in the domestic market.

UBS cut its pre-tax profit estimate this week by a third, from $135 million to $90 million, following the airline's own downgrade earlier this month. UBS also trimmed its share price target from 80 cents to 70 cents.

Virgin shares fell 3 to a six-month low of 46.5 cents yesterday.

UBS aviation analysts Simon Mitchell and Ramoun Lazar believe the Brisbane-based carrier should wind back its planned 7 per cent growth plans on short-haul routes to head off a likely fall in demand.

"Virgin is heavily exposed to any oversupply, deriving (about) 60 per cent of revenue from domestic leisure travel," they wrote in a client note.

"Virgin is also facing significant capacity expansions in the order of 20 per cent on some of its more profitable routes, such as the Gold Coast, from Tiger and Jetstar.

"We see current capacity plans in fiscal year 2011 by domestic airlines as too high and believe Virgin's aim of 7 per cent short-haul capacity growth could be scaled back."

While the overall domestic aviation sector is tipped to grow 11 per cent in the next financial year, UBS said Virgin Blue would have to count on a turnaround in the profitability of overseas carrier V Australia as its "main driver of improvement".

UBS expects V Australia to suffer a $40 million loss this year but deliver a $20 million profit in 2011. The analysts also believe Virgin Blue's net profit will improve from

$60 million to $150 million over the same period.

The outlook continues to brighten in 2012, with UBS tipping a $55 million profit for V Australia and a $120 million profit for Virgin Blue and sister operation Pacific Blue.

CommSec found last week the cost of domestic flights hit record lows this month.

John Borghetti, the veteran Qantas executive who replaced Brett Godfrey at the helm of Virgin a few weeks ago, has revealed little about his strategy.

"You'll see us compete more aggressively in segments of the market that make more sense," he said in a recent interview.

[Rick K]

Absolutely time now to buy more shares !!!
Even at only $1.00 in a year this is great capital growth!
I really see V-australia being the biggest contributor to profit by then with the others (VB,PB) also performing well

Rick K

[D Chan]

I really see V-australia being the biggest contributor to profit by then with the others (VB,PB) also performing well

Rick K

are you sure given the transpac route is currently flooded with capacity?

[Rick K]

Transpac will perform much better with Delta JV operating but. as well, from all reports I've seen, Phuket and Fiji (given political stability in both) have been improving take-up rapidly.
Another 777 will add to this greatly.
I've not seen a lot re loads to Jo'burg yet.

[Mike W]

The proposed Trans-Tasman alliance with Air New Zealand won't hurt either.

http://www.smh.com.au/business/virgin-and-air-nz-seek-transtasman-alliance-20100503-u29s.html

This new partnership could provide DJ with additional pax for intra Australian routes coupling that with cost savings across the ditch.

Upside for NZ as well of course.

[Daniel F]

Absolutely time now to buy more shares !!!


Well I hope you didn't buy any share then... the Virgin Blue share price has plummeted 28% today to $0.31 after announcing a lower profit forecast of $20M to $40M, down from the previous forecast of $80M.

[Greg McDonald]

So it's either a REALLY good time to buy or a REALLY good time to start praying!!:eek::eek:

Over 200 million shares have been traded today so far!!! (15:15)

[Harry G]

if you are praying.........
if DJ get a share of the Govt tender, watch the share prices of QF and DJ!!

[D Chan]

the tender was announced already by Lindsay Tanner?

I'm glad I didn't buy at 50c
http://www.theaustralian.com.au/business/aviation/virgin-blue-plunges-on-profit-warning/story-e6frg95x-1225872519871

[Greg McDonald]

Share price is down 10% already today (market open 30 mins) after news that the DJ/Delta tie up has been denied on the US side...

The U.S. Department of Transportation (DOT) today issued a
preliminary denial of Virgin Blue and Delta Air Lines' application for antitrust immunity in relation to their proposed joint venture on the Trans Pacific Route.

[Bruce Bramwell]

Try only 5% down... Nowhere near 10% at all

[Greg McDonald]

Read my post properly!! At the time I posted, they were down 4c from a starting price of 44c...if you want to split hairs, thats 9.09%.....pretty close to 10% if you ask me.

[D Chan]

The U.S. Department of Transportation (DOT) today issued a
preliminary denial of Virgin Blue and Delta Air Lines' application for antitrust immunity in relation to their proposed joint venture on the Trans Pacific Route.

important to stress it is a preliminary denial so if they manage to put forward their case better they might still have a chance

[Greg McDonald]

And today the ACCC has knocked back the proposed DJ/NZ alliance..

[Sam Chui]

Greg, however VBA price rose from 0.28 lately, a spectacular 30% + return in a week. Understand it went down since , around 0.385 at the moment.

[Greg McDonald]

True Sam...down 11.63% at the moment. It's a far cry from the 77c (I think it was) that it stood at not very long ago...

[Michael Morrison]

And also a fair way off the 15c low that it went to!

Interesting that the ACCC Chairman enjoys a complimentary membership to the Qantas Chairmans lounge.

[Montague S]

Interesting that the ACCC Chairman enjoys a complimentary membership to the Qantas Chairmans lounge.

he flies El Al too...

[Michael Morrison]

And your point is?

My point is he is taking free treats from QF whilst making decisions about their main competitor. Hardly ethical.

[D Chan]

The ACCC is consistent in its decision given it knocked back Qantas's proposal 4 years ago.

http://www.accc.gov.au/content/index.phtml/itemId/744922

[Anthony T]

Why is there only one ACCC, surely thats a monopoly situation. :D

[Andrew Ewen]

Does anyone know what proportion of Pacific Blues total lift is dedicated to the TransTasman routes ? I am just wondering whether the ACCC could find themselves inadvertently actually causing the loss of competition/capacity that they fear if DJ decides that re-allocating those resources elsewhere is the only way forward ?

If DJ are losing money on the Tasman and if DJ want a tie-up with NZ badly enough ( both big "ifs" I admit ) then what is to stop them just pulling the plug on their own Tasman routes , reallocating those aircraft to other routes and then re-applying to the ACCC for a tie-up with NZ pointing out that this time round there would be absolutely no overlap/loss of competition?

Let the flaming commence :D

[Greg McDonald]

Old topic but what the heck....both Qantas and Virgin Aus share price is getting a hammering today. QAN down .08c (5%) and VBA down .025c (10%) as of now. Understandable tho...the whole market is coping a caning today.
Shareholders would definitely not be happy!! I wonder at what point the powers that be at the airlines would start to get worried.

[BradR]

No point getting worried about a drop today when the whole market is moving that way.

It is more concerning when your price is dropping because the market doesn't like your strategy or your underlying business. Both Australian airlines are nearing this point.

Qantas has stopped paying dividends and has shown zero share price growth since it listed. AJ needs to define a cogent strategy on 24/8 or the SELL recommendations will multiply and then the price will fall irrespective of the general market. The directors are supposedly there to protect and grow shareholder wealth so they cannot tolerate the falling share price forever.

Virgin has defined a strategy and the market has tolerated JB incurring losses in the short term as he puts this strategy in place. Should it not show any sign of improving the business' performance within the next 6-12 months, he and the Virgin directors can expect the market to be very harsh on it too.

[Beau Chenery]

I don't think Airlines and Shares mix well together.. regardless of your strategy..

[Bernie P]

Not a bad result...

VIRGIN Australia Holdings says the chase for more business customers is progressing ahead of schedule and has delivered a hefty improvement in first half net profit.

Separately, Virgin has also announced a restructure of its international operations to ensure compliance with the Air Navigation Act, which limits foreign ownership of Australian international airlines to 49 per cent.

Australia's number two carrier today said net profit for the six months to December 31, 2011, came in at $51.8 million, up 118 per cent from $23.8 million in the prior corresponding period.

Virgin Australia chief executive John Borghetti said the airline had made significant progress on diversifying its revenue sources.

Mr Borghetti said 17 per cent of the airline's revenue now came from the corporate and government market, which typically paid higher average fares per passenger, or yields.

This was up from 13 per cent in 2010/11.

"Today's financial results demonstrate that our strategy to reposition the business is having a material impact on the company's financial position ahead of schedule," Mr Borghetti said in a statement.

Virgin said underlying profit before tax - the airline's preferred measure of financial performance - came in at $96.1 million, up 34 per cent from the prior corresponding period.

The result was also above market expectations of $79.7 million, according to a median of four analysts' forecasts gathered by AAP.

Total revenue rose 18 per cent to $2.0 billion.

"While we have continued to see high fuel prices and an uncertain economic environment, the Game Change Program strategy has helped us to improve earnings stability and achieve growth during this half," Mr Borghetti said.

Mr Borghetti said the airline had secured 35 new accounts during the first half, and maintained all of its previous accounts.

Citing the uncertain economic environment, Virgin said it was unable to offer specific earnings guidance for the full year, saying only it expected an improvement in underlying performance in 2011/12, compared with the prior year.

Virgin reported a full year loss of $67.8 million in 2010/11.

Read more: http://www.news.com.au/business/virgin-australian-holdings-says-net-profit-doubles-to-518-million/story-e6frfm1i-1226279048587#ixzz1n9VNBHOq