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Brokers don't agree with the pessimistic SP prediction from Superhortnet e.g. Berenberg recently suggesting a price target of 750p and recommending a buy. Hope they're correct!
£10m cost in compensation alone?
I was one of the unfortunate on Friday and I can state that the cancellations are not due to a lack of tourists. 2 planes full of passengers were all cancelled at the same time as the one I was on, the cancellations will hit the bottom line because (unless I am mistaken) even if you are lucky enough to get a flight the following day you will still get a Minimum of £200 compensation
6 sets to a row
40 rows
240 seats x £200 each seat
3 planes on Friday evening and that was just Gatwick
Then multiply that by the rest of the following week
Be interested to know the average profit made per plane
Then you can work out how much the Compensation will affect the already battered balance sheet
spunken, be prepared to be permanently unhappy then. Current EZJ marker cap (number of shares times the share price) is about £4bn. That's way too high for a company that is making no money and has high net debt. This year so far the firm has lost half a billion pounds. Looking at all the cancellations and bad publicity, together with nervousness among many consumers about the high cost of living (energy costs have practically doubled to about £3k a household annually; food is up about 50%; council rates, petrol, mortgages and everything else is rising dramatically). A lot of holidays are being deferred/cancelled by consumers themselves.
This current quarter for EZJ will also probably be loss-making. Q4 - who knows? imv there will be another £800m loss for the year which ends on Sept 30th. Market cap should be about £2bn imv. Maybe £3 per share maximum. And please don't tell me that the shareprice used to be £12. There were half as many shares back in those days and EZJ had no debt and paid dividends. We are at least two years away from profits and probably three years or more away from dividends. Save your boilerhouse pump'n'dumping for the penny shares.
History repeats itself…. nothing but low temperatures and rain over Long tedious expensive Jubilee weekend..
Congratulations to anyone who made it to the sunshine :)
This is only going one way and market knows it.. if we dont get another spike in covid cases, number of flights will increase to accommodate demand.. I was hoping for £7/8 by September, but seeing these numbers now I’ll be unhappy with anything less than £9
BA, TUI and easyjet have all cancelled a lot of flights, though EZJ seems to have cancelled more than the others. My guess is that the cancellations are down to the traditional reason for flight cancellations - not enough passengers. It's obvious that an 'IT glitch' doesn't cause an airline to cancel just 24 flights a day for 10 days. This loss of business (although its business that never existed in the first place) will blow a hole through the CEO's claim to be flying 97% of 2019 capacity. On top of that, there is the cost of compensating potentially thousands of customers, the loss of trust amongst easyjet customers, who will now look to Ryanair instead, the terrible publicity being broadcast every day with sad stories of families sleeping on airport floors and losing several days from their 'dream holiday' and the straight-forward loss of revenue. My guess is that despite all the claims about airports being 'busy like it's 2019' there will be another big loss-making quarter, possibly £100m to £200m down again.
EZJ is valued at about £4bn but continues to produce no profit and merely adds to its indebtedness. I reckon fair value here MIGHT be about £2bn, which translates to about £2.50 a share. It might be a few months before the market agrees with me, but all credit to Johan for keeping the market cap and shareprice up close to 2019 levels for now, despite endless bad publicity, disgruntled customers and huge losses. He is walking on water imv.
The reason that EZJ has problems at Gatwick has nothing to do with a large number (150?) of cabin crew resigning to take up positions with BA. Nor the problems with catering or the inability to get aircrew back on-line. Or has it! Let’s blame the computer!
Senior management took their eye off the operational ball during the pandemic and the predictable results are now clear for all to see. How much is the compensation due to passengers as a result of cancellations going to cost? How damaged is EZJ 's reputation as a result?
This, plus other problems in the economy, are all down to the unnecessary dystopian CV19 strategy implemented by the clown from HIGNFY at number 10. You can rewrite the rules to excuse untrustworthy behaviour, but you can’t rewrite those that effect the economy.
Just saying.
Shpunken
Did not mean to over-post, apologies :)
This is exactly right. Compensation and Fast will keep customers on side….and kids are quite good at dealing with travel disruptions!
IT glitches are short lived and expensive and should be avoided…bet Johan was annoyed.
If anything, the recent cancellations have reminded me how much we all took this airline service for granted.
Extreme bullish for future.
The way they handled this situation is much better than a few weeks ago.. I see this as a positive.
A spokesperson for easyJet told The Independent: “Over the next week we will be operating around 1,700 flights per day, with around a quarter of these operating to and from Gatwick.
“We have taken the decision to make advance cancellations of around 24 Gatwick flights per day starting from tomorrow 28 May until 6 June.
This just shows that they can’t cope with a huge demand, next Q results will be spectacular
With all the last minute cancellations it must be costing a fortune. My sons flight to Seville was cancelled last minute last week and he claimed and has received more money in his bank than the flight cost and with hundreds of flights getting cancelled this will surely not only cost financially but in trust !! That said the claim was sorted within 7 days so credit there !!