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Oilbell.
Hi A.Smithy, the more sensible posters on this forum will admit that the company is not doing well and this is a distressed situation. The value is in the assets, but it's not the current shareholders who can reap the benefits of this value, hence the bombed out SP. You also have to ask yourself, if Stobart's offer was rejected earlier this year (rumoured to be in the 50p range), is it unreasonable to think they will return to the table with a further offer at a much lower price? Has that much changed about the company since March? The picture is less rosy but certainly not so bad as to justify the share price being a quarter of what it was.
I would however say that unless we have multiple bidders, our balls are well and truly in the hands of that one offeror and in this instance I think we are looking at an exit of 15p(ish) and lower.
As someone said here, we are taking huge risks, but some of us are more aware than others. Any shareholder who can put their hand on their heart and say they are getting a pleasant night's sleep at the moment is either a liar or deluded.
ummmmm, you sure?
I think the issue we may well have experienced this morning is that these institutions' holdings are down so much from their original investment that when they decide to sell they aren't bothered about getting a good price; they dump them all in the market to get rid of them at any price, as opposed to an orderly drip feeding so as to avoid volatility. If some of these other institutions start selling, we are in for a rocky ride. Fingers crossed they hold out for a bid.
If they did, that dismisses the idea that posting on this board has no effect on the share price!
Garydav2 - what if it is a case of the company being solvent but just out of cash, then what happens? Can they not sell off an aircraft or two now, in anticipation of a cash crunch? If the assets are illiquid which forces the company into administration, I would expect the shareholders to get a share of the sale proceeds from the assets of the company when they do eventually sell.
Absolutely Sundayroast, it's the value of Flybe to another airline or business, that is the key, not the value to the current shareholders.
Utter rubbish - stop with the BS. It's IAG, not British Airways.
Some of the comments on this board are quite frankly amateur. It seems any bear case is immediately rejected and those posters are labelled as a shorter. I'm long Flybe but there is a huge risk in this trade. If you cannot see the bear case you are a fool. Yes, Flyb have the cash but once it's gone, that is it. Shareholders have been taken for a ride ever since floatation and are not going to want to inject any more capital; I suspect this is one of the reasons the company is up for sale in the first place. You also have to remember that IF there is just the one bidder, we're going to have very little negotaiting room. Of course from the bullish point of view, if we have multiple bidders things could get very tasty indeed!
To me it makes sense that IAG would be interested, especially with the planned Heathrow expansion and their desire to have more regional traffic. Think of the benefits to the BA/IAG network of having a regional feeder into Heathrow.
Easyjet - other than for the slots at some of the bigger airports, I can't see what would appeal to Easjet. Many of Flybe's routes would be unsustainable with a bigger aircraft, which is why Flybe are on them in the first place (and mostly without competition). Easyjet are a single aircraft fleet, so what they would want with a bunch of Dash 8s and some pound absorbing Embraers I don't know.
Stobart - admittedly I know little about their operations but if they've put in a bid at 50p it makes sense that they would be interested in Flybe at these levels.
Let's have some constructive discussion today ladies and gentleman.
in the defence of Herbieridesag, it's a question that any sensible investor should be asking themselves. Not that there are many sensible investors on this forum. My take is that this company is worthless in its current state in the open market to the likes of you and me because there is little chance they are going to be able to tap up investors for any more cash. The value here is the value to other players, be it airlines who can inject cash and take advantage of synergies or pe houses who can inject cash or strip the business and sell it off piecemeal.
Agreed. I think some people are in cloud cuckoo land if they think a bidder is going to pay more than twice the market cap.
I’m surprised no one has talked about his analysis. It certainly sums up my thesis for putting money here https://www.stockopedia.com/content/small-cap-value-report-wed-14-nov-2018-flyb-abdp-mmh-rno-418659/
You'll probably see the hedge funds coming in shortly...
Exactly taylot, this is about assets, not the business. It might be worth sod all to shareholders, but someone out there will see value in the acquisition.
Have only had my shares for a few days! I can’t see anyone paying a huge premium for the company in the state that is. It’s kind of like buying an old house which needs a lot of work. You’re not going to over pay if you need the money for doing her up. I hope that I am well off the mark of course! Given all the external events SBB1 mentioned, this is going to be one heck of an interesting day for us holders.
Right, so that was a waste of time. I was referring to market cap and what people are willing to pay!
Are we still talking about market cap, because that's what I was referring to with my £25million? Your figure sounds more like the net assets?
Go on Auson, tell us what it is...
Apologies, that should have read £24.43million
After an LSE Flybe forum hiatus of 2 years, I've returned to find the usual old guff being spouted (bang on the money jungerns). Anyone would think Flybe's PI base is a bunch of clairvoyants!
Some of the comments I've been reading in the press of Flybe going bust are laughable. For the last time, the share price is a reflection of investor sentiment NOT the health of a company, or any sign of its impending doom! This is really amateur stuff.
They had £93 million in net assets as at 31 March 18 and its worth £25million at today's price. This is not a company that is dissappearing anytime soon (at least not going bust!). Any other company would be valued 10 times what Flybe is now, however this is Flybe and sentiment has been awful for many many years as a result of failed turnarounds, Brexit, oil, you name it! I imagine many long suffering Flybe shareholders feel this share is cursed.
I've always been careful of adopting a strategy of investing in companies that are takeover targets; it's never worked for me and I often end up in a value trap. However, I do like the risk/reward at this price.This is one of those ones which could potentially double in price (at least) from a takeover, or even a buyout by private equity who could unlock value in the slots and aircraft etc?