We keep flying high

[haze]

Originally Posted by Nugget

Do you realize that this is a bad sign? I'm not sure why you'd point out a cash shortage as a positive indicator.

Sorry Nug, you're just plain wrong here and I'm about to point out exactly why it is a positive indicator. I've already pointed out, with specific numbers, that it's not a cash shortage by any stretch of the imagination so I believe that has been firmly established and accepted. You will find all the details in an article to follow, which will also clearly demonstrate that you and dbaker are the ones who have no idea what you're talking about and that myself and b717mech are right on the money. The article demonstrates just that, on a point by point basis, exactly. Funny, this is the second time in a week that an expert's article substantiates my claims. A week after I've already stated them, nonetheless

[haze]

9/29/03 - Investors Welcome Stock Offerings From Profitable Carriers


Sep 29, 2003 (Airline Financial News/PBI Media via COMTEX) -- Three profitable, low-fare airlines have turned to the stock market to raise additional equity to pay off debts and finance new aircraft. Investors' appetites have turned the corner for some, but not all airlines.

Frontier Airlines [Nasdaq: FRNT], AirTran Airways [NYSE: AAI] and WestJet Airlines [Toronto: WJA] since Sept. 15 have taken steps to sell a relatively small amount of stock on the open market.

AirTran hopes to sell 8.65 million shares. Underwritten by Morgan Stanley, the offering has not been priced. The underwriters can sell an additional 1.2 million shares. The offering could raise about $150 million for the Florida-based airline. AirTran will use the proceeds of the offering to redeem $35 million in senior secured notes currently held by Boeing Capital Loan Corp. AirTran will also purchase 1 million shares that Boeing Capital now holds. The airline currently has 73.4 million shares in circulation. The balance of the offering will be used for working capital and capital expenditures, including aircraft purchases.

AirTran, which posed a net income of $57.2 million in the second quarter, plans to buy up to 100 B737-700s with the deliveries beginning next year. AirTran currently flies B717s and will add 10 more to that fleet.

The climate in the financial markets has changed because some of the airlines are now profitable and the stock prices have been climbing, said Helane Becker, an analyst with New York's Benchmark Capital. And the outlook is good at least through November.

"I think now is a good time to do it," said Cameron Doerksen, an analyst in Montreal with Dloughy Merchant Group, one of the firms handling the WestJet deal. "We are coming off the two best quarters of the year for airlines, Q2 and Q3. If you wait six months, you will be in the slow season. It makes more sense to do it right now when there is a window of opportunity."

Both analysts agree the window is only open for the profitable airlines.

"These airlines have a pretty good story to tell - that is they are profitable," Becker said. She noted that Delta Airlines [NYSE: DAL] and American Airlines [NYSE: AMR] were not successful this summer in either selling convertible notes or exchanging old debt for new debt. The key element, she said, is that neither of these two airlines were profitable.

"The opportunity is for the low-fare, low-cost guys because they are the only ones making any money," Doerksen said. "It is probably still difficult for the larger airlines to raise money. Most are heavily in debt and are still losing money.

"Operationally, it makes more sense for the low-cost airlines. They don't need the same level of capital injection because they are relatively small and growing. A large airline is not going to be able to raise that kind of money in the equity market given where their prices are right now."

For these three airlines, Doerksen said, the offering will not dilute the stock value for current shareholders because each individual airline's share prices are quite strong. On the other hand, an offering for a major carrier right now "would be totally dilutive."

The timing is also right to adjust their balance sheets, he said. "A lot of airlines have increased their level of debt so now the focus is more on the equity portion of the balance sheet."

Standard & Poor's reviewed and maintained AirTran's debt rating (B-) after the airline decided to pay off the senior debt.

"If the common stock offering is successful, AirTran's liquidity and balance sheet would improve," said S&P analyst Betsy Snyder. "Its rating outlook would likely be revised to 'positive' from 'stable.' The proposed share offering would more than double the company's equity base..."

Well whataya know, looks like the experts agree with me and b717mech after all. Imagine that, two people on this board who actually know what they're talking about. Novel concept

Info: althought the article states a price has not yet been set for the offering, AirTran has actually already announced a price of $16/share. Also, I truncated the Frontier and WestJet portion of the article out of length considerations.

[haze]

Are you sure about that?

Originally Posted by Nugget

...This dilutes the current investors, effectively reducing the value of every single share of airtran stock that exists. Companies do this when they need quick cash and the cash is found at the expense of every single existing investor...If the comapny then issues another 1000 shares, you only own 5% of the company without having sold any shares or taken any money in compensation for the loss of ownership. It's a raw deal...

Not exactly:

"For these three airlines, Doerksen said, the offering will not dilute the stock value for current shareholders because each individual airline's share prices are quite strong. On the other hand, an offering for a major carrier right now "would be totally dilutive."

Guess one size doesn't fit all after all

[haze]

Originally Posted by dbaker

Indeed nothing to brag about. What was the timing of the director sales?

No?

"If the common stock offering is successful, AirTran's liquidity and balance sheet would improve," said S&P analyst Betsy Snyder. "Its rating outlook would likely be revised to 'positive' from 'stable.' The proposed share offering would more than double the company's equity base..."

I think our work is done here, gentlemen

[haze]

Sorry, I just had to pick on this one again:

Originally Posted by Nugget

Do you realize that this is a bad sign? I'm not sure why you'd point out a cash shortage as a positive indicator. It's a possible explanation for why we saw several directors recently dumping their airtran holdings, too.

Airtran shares fell over 4% in today's morning trading over this news.

You had to know that slant wouldn't hold up for very long. As the following chart shows, while all others are dropping AirTran continues to soar. So much for the logic behind AirTran shares falling over 4% over this news. It's been up anywhere from 2-4% a day since this news broke:

Name Last Change Pct

AMR 11.45 -.09 -.8
AirTran 16.75 +.50 +3.1
CtlAir B 16.58 -.77 -4.4
DeltaAir 13.30 -.16 -1.2
NwstAirl 9.70 -.25 -2.5

Last updated Tuesday, Sept. 30, 5:29 p.m.

[mduell]

Originally Posted by haze

AirTran continues to soar. So much for the logic behind AirTran shares falling over 4% over this news. It's been up anywhere from 2-4% a day since this news broke:

Perhaps you missed 9/19 (down .83), 9/24 (down .14), 9/25 (down 1.04), 9/26 (down .77).

Opened around 17.71 on 9/19 (the date of the announcement), and it's at 16.75 now, a drop of .96, or 5.42%, which comes out to 0.6775% drop per day since 9/19.

[jetmech717]

Mission accomplished! I am happy to note that this is good times in the AirTran forum because if all I have to read is arguments....no.. DEBATES, on how we are doing in the market and not dis-crediting the maintenance practices of the Airline than I am a happy man. Its nice to see that the forum is actually being used (almost) like all the other airlines. I guess we set the record straight on the slanted portrail of AirTrans maintenace practices. So with that being said, please feel free to come to the sources next time that sort of issue is brought up again. Until then I hope we do well in the market and I wish all of you very good luck if you so dable in it. (expecially if you buy our shares ) Later

[B717mech]

Originally Posted by mduell

Perhaps you missed 9/19 (down .83), 9/24 (down .14), 9/25 (down 1.04), 9/26 (down .77).

Opened around 17.71 on 9/19 (the date of the announcement), and it's at 16.75 now, a drop of .96, or 5.42%, which comes out to 0.6775% drop per day since 9/19.

Does it really matter that the price is down a dollar or so since the announcement? Consider that the stock was around 2 or 3 dollars less than a year ago. I think that ratio speaks for itself.

[haze]

Look, the price for the offering was set at $16, the price at the time of the announcement was nearly $18, the price dropped to around the price of the offering, and now the stock is trending back up as yesterday's latest quote shows. If you'll look at those stats again American, Continental, Delta, and Northwest were all down while AirTran was up. Also notice AirTran is the highest of those five. You'll also discover that AirTran is still trading at a P/E below 19, far from being overvalued. $300,000,000 in cash reserves, far from being cash-strapped. A market cap greater than or equal to Delta, Continental, Northwest, etc. An expanding network while others shrink. A very young fleet getting younger every day. Buying back debt (rated "B"). Analysts' predictions rising from "stable" to "positive."

So, in 8 days of trading you were able to find 3 down days? Ohhhh, I see your point

[mduell]

My comment had nothing to do with AAI's historic performance, their P/E ratio, or them buying back debt. I was just calling bull**** on your claim that the stock was up 2-4% per day; rather, in the 8 days since it hit the news its down over 5%.

[haze]

Originally Posted by mduell

My comment had nothing to do with AAI's historic performance, their P/E ratio, or them buying back debt. I was just calling bull**** on your claim that the stock was up 2-4% per day; rather, in the 8 days since it hit the news its down over 5%.

Pardon me, let me make a correction then: the stock is up 2-4% a day, except for 3 days, since this news broke.

Speaking of...cough cough cough BULL**** cough cough...the stock was $17.71 the day of the announcement and is currently sitting at $17.21. Not exactly down 5% since the news hit, as you suggest. Nugget was trying to point out that the stock was down 4% on the day of that news, and I was just pointing out that most days since then it had been up. I guess I should've said "the majority of days" instead of "everyday", I guess I must have completely lost my mind. By the way, the stock was up 1.5% again yesterday. I think everyone gets the point I was making. And the whole point of listing the low P/E ratio, reducing debt, etc. was to demonstrate that the stock will continue trending upward, not downward like Nugget was implying.

Like jetmech717 just said, if the argument here has been reduced to the fact that I said "everyday" instead of "everday but three", then mission accomplished

[haze]

Bodda-bing, bodda-boom! And now they're done. Eliminated $35,000,000 in debt, raised $140,000,000 in "spendable" cash without dipping into the $300,000,000 cash reserves, and the stock only dropped $0.50 from the time prior to the announcement to the completion of the offering:

10/01/03 - AirTran Holdings, Inc., Announces Closing of Public Offering and Exercise of Underwriters' Over-Allotment Option


ORLANDO, Fla., Oct 1, 2003 (BUSINESS WIRE) -- AirTran Holdings, Inc., (NYSE:AAI), the parent company of AirTran Airways, today announced that it has closed its recently-announced public offering of 8,650,000 shares of its common stock, and that prior to the closing, the underwriters elected to purchase an additional 466,000 shares pursuant to the over-allotment option granted in connection with the offering. Including the exercise of the over-allotment option, net proceeds from the offering were $139,292,480.

AirTran Holdings intends to use the net proceeds from the offering to:

-- Redeem $35 million of its 11.27 percent senior secured notes,
currently held by Boeing Capital Loan Corporation; and

-- Purchase from Boeing Capital warrants currently held by it to
purchase 1,000,000 shares of AirTran Holdings' common stock
for a purchase price based upon the public offering price less
the exercise price of the warrants.

AirTran Holdings intends to use the remainder of the proceeds from the offering for working capital and other capital expenditures, including capital expenditures relating to aircraft purchase.

Morgan Stanley is the sole bookrunning manager on this transaction, with Raymond James and Associates, Inc. and Blaylock and Partners, L.P. acting as co-managers.

[haze]

Originally Posted by haze

Speaking of...cough cough cough BULL**** cough cough...the stock was $17.71 the day of the announcement and is currently sitting at $17.21. Not exactly down 5% since the news hit, as you suggest.

And after one hour of trading this Friday morning the stock has soared nearly 4% to $17.86, 1% higher than it was before that bad ole public offering. And rapidly approaching a new 52-week high. It's becoming painfully obvious who knows what the hell they're talking about and who doesn't. At a time like this, that old "fighting windmills" quip that some were tossing my way comes to mind...and gives me great pleasure

Corporate Snapshot
AIRTRAN HLDGS INC (NYSE:AAI)
Latest Quote


Last: 17.860
High: 18.170
Low: 17.550
Open: 17.990
Change: +0.65
Volume: 182,500


52 Wk High: 18.300
52 Wk Low: 2.510
%Change: 3.7%

[mduell]

At the time the my comment was made, it was indeed down. Of course, I'm not psychic like you seem to be, and I had no way of guessing that the stock price would rise in the days following my comment.

[haze]

...it doesn't take a psychic and there is no guesswork involved. All the signs are self-evident for those willing to see them. That's the whole point of this argument

[haze]

And by the looks of the nearly 1,000,000 shares of AAI already traded this morning, there are quite of few of "those willing to see" those signs:

Corporate Snapshot
AIRTRAN HLDGS INC (NYSE:AAI)
Latest Quote


Last: 18.630
High: 18.650
Low: 18.050
Open: 18.100
Change: +0.67
Volume: 892,700


52 Wk High: 18.650
52 Wk Low: 2.510
%Change: 3.7%

...and going, and going, and going. And still a very attractive P/E ratio!

[haze]

Back when AAI shares were down around $16 I was trying to suggest that the low P/E ratio of less than 20, buying back debt and modernizing their fleet with a public offering instead of using cash reserves, earnings results and projections, increasing market share and expansion, and so on all pointed to the stock rising instead of falling as some of you were suggesting. mduell first said he wasn't concerned with "AAI's historic performance, their P/E ratio, or them buying back debt" and then went on to say "Of course, I'm not psychic like you seem to be, and I had no way of guessing that the stock price would rise in the days following my comment." I tried to explain that no psychic energy and/or guesswork was involved, and the fact that he and others chose to ignore those indicators is why they had no idea.

But I did have an idea and tried to explain why you were wrong, as these results vindicate:

10/08/03 - 52W HIGH: New 52-Wk High for AAI @ $19.550 up1.56% [delayed]


Ridgeland, MS, OCT 08, 2003 (EventX/Knobias.com via COMTEX) -- This is the 3rd 52 WEEK HIGH alert for AAI in the past 7 calendar days.

The share price for AirTran Holdings Inc (NYSE: AAI) reached a new 52-week high today, trading at $19.550, up $0.300 (1.56%) from its previous close of $19.250.

The Company's previous 52-week high of $19.490 was set yesterday on October 07, 2003.

One year ago, the Company's shares closed at $2.870. The price has climbed more than 581 percent since then.

At the time of this alert, the stock had traded 55,500 shares via 19 trades, 96.96% below it's 20day average of 1,828,025 shares.

This new 52-week high currently puts the stock:

12.59% above its 20day Moving Average of $17.364

29.23% above its 50day Moving Average of $15.128

58.83% above its 100day Moving Average of $12.309

The Company last released news on October 02, 2003:

"AirTran Holdings, Inc. Announces Webcast of Third-Quarter Earnings Conference Call"

AIRTRAN HOLDINGS INC

[haze]

Indeed, like the title of this thread states, AirTran keeps flying high

10/09/03 - Buy List Highlights: AirTran Holdings, i2 Technologies, MBNA Corporation, and PETsMART


CHICAGO, Oct 9, 2003 (BUSINESS WIRE) -- Zacks.com releases another list of stocks that are currently members of the coveted Zacks #1 Ranked list which has produced an average annual return of +33.6% since 1988 and has gained +13.3% annually since 2000 as the markets have been tumbling down. Among the #1 ranked stocks today we highlight the following companies: AirTran Holdings, Inc. (NYSE:AAI) and i2 Technologies, Inc. (NASDAQ:ITWO). Further they announced #2 Rankings (Buy) on two other widely held stocks: MBNA Corporation (NYSE:KRB) and PETsMART, Inc. (NASDAQ:PETM). To see the full Zacks #1 Ranked list or the rank for any other stock then visit. http://www.zacksrank1bw.zacks.com

Here is a synopsis of why these stocks have a Zacks Rank of 1 (Strong Buy). Note that a #1 Strong Buy rating is applied to 5% of all the stocks we rank:

AirTran Holdings, Inc. (NYSE:AAI), through its wholly owned subsidiary, AirTran Airlines, Inc., operates an affordable, no frills, limited frequency, scheduled airline serving short haul markets. Last week, AAI announced that passenger traffic, or revenue passenger miles (RPMs), was a record for the month of September. Based on RPMs, traffic grew by +37.6%, to 525.6 million RPMs, on an increase of +26% in capacity, based on available seat miles (ASMs). September's load factor reached 63.4% compared to 58% in September 2002. Third quarter figures will be released on October 22, 2003. Going back, in late July the company reported second quarter 2003 earnings, excluding special items, which beat both the consensus and the year-ago performance. Earnings estimates for this year and next have improved by approximately 4 cents and 2 cents respectively within the last week, with analysts expecting a +26% improvement in next year's earnings result over this year. AirTran Holdings has managed to weather the latest economic storms and looks to clearer skies ahead.