BoeingBoy
Veteran
- Nov 9, 2003
- 16,512
- 5,865
- Banned
- #16
The analyst's are starting to update recommendations.....
Standard & Poor's:
February 21, 2006
11:40 am EST... S&P REITERATES HOLD OPINION ON SHARES OF US AIRWAYS GROUP (LCC 32.9***): In a very complicated earnings release, LCC’s Q4 per-share loss is $3.26 vs. a loss of $4.66, wider than our $2.00 loss forecast. Before one-time items, the loss was $1.72. We think LCC is making major progress in numerous areas; the co. reiterates that it expects to be profitable in ’06 before merger costs. Passenger demand remains strong. We are keeping our ’06 EPS estimate at $1.50, and raising our target price to $35 from $32, valuing the stock at 23X that estimate, above peers. We think LCC is doing a commendable job, but see much of this already priced into the stock. /J.Corridore
Lehman Brothers
US Airways Group (LCC - $ 32.50) 1-Overweight
Change of Earnings Forecast
Still See Opportunity - Investment Conclusion
The risk reward in LCC remains favorable from our perspective. We believe the combination of revenue strength and lower than anticipated nonfuel costs has positive implications for earnings power and relative valuation.
Summary
! Reported 4Q ($1.72), slightly ahead of our ($2.15).
Revenue slightly lower, but more than offset by better cost performance.
! Cost performance and outlook better than anticipated; we now estimate a 7% gap between heritage America West and US Airways versus more than 15% a year ago.
! Fuel guidance suggests a bit more fuel cost than we had modeled, especially in 1Q, but not changing commodity price assumptions.
! Slightly raising 2006 and 2007 estimates; valuation not materially impacted. Target remains $40.
! Overhang and trading liquidity concerns may dominate near-term performance, but we ultimately believe the shares will trade on earnings potential. On that basis, we like LCC relative to others in the group.
Prudential Equity Group
HIGHLIGHTS
• US Airways Group reported a fourth quarter fiscal 2005 net loss, excluding items, of $138 million, or $1.72 per share. This compares to our estimate of a loss per share of $1.55 and consensus loss per share of $1.93.
• Total revenue and operating expenses were in-line with our estimates. Within operating expenses there was nothing materially different than our expectations, only variances related to this being the first quarter with US Airways and America West reporting as a combined entity.
• Management was fairly specific with its guidance and is projecting full-year 2006 to be profitable. This expectation for a profit excludes an estimated $110 million in merger-related charges. Guidance was presented as such, that including the $110 million charge US Airways would unlikely remain profitable for the full year. We are adjusting our 2006 estimates based on the new guidance.
• We continue to rate US Airways Neutral Weight, as we believe the shares will move with the airline group in general.
Jim
Standard & Poor's:
February 21, 2006
11:40 am EST... S&P REITERATES HOLD OPINION ON SHARES OF US AIRWAYS GROUP (LCC 32.9***): In a very complicated earnings release, LCC’s Q4 per-share loss is $3.26 vs. a loss of $4.66, wider than our $2.00 loss forecast. Before one-time items, the loss was $1.72. We think LCC is making major progress in numerous areas; the co. reiterates that it expects to be profitable in ’06 before merger costs. Passenger demand remains strong. We are keeping our ’06 EPS estimate at $1.50, and raising our target price to $35 from $32, valuing the stock at 23X that estimate, above peers. We think LCC is doing a commendable job, but see much of this already priced into the stock. /J.Corridore
Lehman Brothers
US Airways Group (LCC - $ 32.50) 1-Overweight
Change of Earnings Forecast
Still See Opportunity - Investment Conclusion
The risk reward in LCC remains favorable from our perspective. We believe the combination of revenue strength and lower than anticipated nonfuel costs has positive implications for earnings power and relative valuation.
Summary
! Reported 4Q ($1.72), slightly ahead of our ($2.15).
Revenue slightly lower, but more than offset by better cost performance.
! Cost performance and outlook better than anticipated; we now estimate a 7% gap between heritage America West and US Airways versus more than 15% a year ago.
! Fuel guidance suggests a bit more fuel cost than we had modeled, especially in 1Q, but not changing commodity price assumptions.
! Slightly raising 2006 and 2007 estimates; valuation not materially impacted. Target remains $40.
! Overhang and trading liquidity concerns may dominate near-term performance, but we ultimately believe the shares will trade on earnings potential. On that basis, we like LCC relative to others in the group.
Prudential Equity Group
HIGHLIGHTS
• US Airways Group reported a fourth quarter fiscal 2005 net loss, excluding items, of $138 million, or $1.72 per share. This compares to our estimate of a loss per share of $1.55 and consensus loss per share of $1.93.
• Total revenue and operating expenses were in-line with our estimates. Within operating expenses there was nothing materially different than our expectations, only variances related to this being the first quarter with US Airways and America West reporting as a combined entity.
• Management was fairly specific with its guidance and is projecting full-year 2006 to be profitable. This expectation for a profit excludes an estimated $110 million in merger-related charges. Guidance was presented as such, that including the $110 million charge US Airways would unlikely remain profitable for the full year. We are adjusting our 2006 estimates based on the new guidance.
• We continue to rate US Airways Neutral Weight, as we believe the shares will move with the airline group in general.
Jim
h34r: Or has that changed and now you are employed holding specific information...
