Member Info for RogueRiver

Who knows? Despite management reassurances, the company is in a state of flux. It is not inconceivable that further bad news is on the way: Review period reduced from 6 months to 3 "due to future liquidity considerations". Major contractor gives notice that they will cease work on site in x days "due to concerns over future payments".

What we do know is that previous dramatic falls in the SP have been swiftly followed by bad news. Sorry to strike a negative tone - and maybe I'm wrong. It wouldn't be the first time.

It is interesting to note that Friday's dramatic downward spiral started around the same time as that of Fri 13 Sep - i.e. 12:00. It could be mere coincidence, but I would not be surprised if that is the time at which a decision is reached (or communicated) by higher management that results in a Monday morning RNS. Standby.

Barring any major calamity, I think the SP will climb on a steady trajectory up to about a week before 21 Oct, then we will see a very sharp spike right up to D-day.

I don't think this is just about pay anymore. It is becoming a battle of wills, given BA's refusal to enter into further negotiations after BALPA called off Thursday's strike.

BA are not exactly fighting from a virtuous position. Customer dissatisfaction levels, the IT glitch, the £183.5 million GDPR fine and other recent failures tend to suggest that senior IAG management are not performing well. With the continuing threat of strike action, customers are booking flights elsewhere, which is only going to hurt profits more.

The only way I can see this ending (probably in the new year, after another round of strikes) is with BA making a concession on pay. Meanwhile, this year's profits will probably end up taking a £1 billion hit and the SP will be (further) in the toilet. Clawing back customers who have abandoned the brand this year will probably take its toll on profits in the next FY too. The damage to the brand may take years to repair.

Shorts are down by just 0.11% since 24 Sep, which equates to around £3.5 million worth of shorts covered. I'm amazed it isn't more.

SteadyGoes

I'm not offering any advice, just making a wry observation on silly tech company valuations, as compared with a tangible project like SM. No need to be rude. I've as much right to be here as you have.

I wouldn't normally advocate shorting, but if i were looking to claw back my losses, I'd sell SM and use the proceeds to short Peloton which floated on the NYSE today. This glorified exercise bike/spin class company has a valuation of circa $8bn! , despite its never having made a profit and being under a mountain of debt.

Utter madness, just like other recent lunatic IPOs - Aston Martin, Lyft and Uber.

Nice to see the SP bouncing back today.

However, this is what BALPA had to say in their press release yesterday:

"Given that we have had no response from the airline to our request for meaningful negotiations, the BA pilots believe their management is treating them with contempt and are now asking BALPA to consider more strike dates."

Having read some BA pilots' BB comments, I think we might now be looking at a week-long strike - and they won't be calling it off this time. In addition to the 6% hit caused by the strike of 10-11 Sep, this could wipe another 10% off full-year profits. If this happens, I would anticipate the SP falling to somewhere in the 400-420p range from today's closing price.

I'm not trying to be alarmist, but I'm worried - and I'm keeping a very close watch on the press release section of the BALPA website.

Aubery

I think what you are perceiving as attacks are actually retreats. IIs and PIs are getting out while they can. Meanwhile, the short sellers will be content to sit and wait for the SP to fall to zero, which is looking more likely by the week.

This is an awful situation for PIs to find themselves in, but putting off the almost inevitable isn't going to help. I've seen the forlorn hopes of PIs dashed on the BBs for Debenhams, Flybe and Thomas Cook. All very different companies, but the PI narrative from a certain cohort is always very similar - denial and hopeless optimism.

Good luck all.

Conversely, with BA picking up quite a few ex-TC routes, they will probably be searching for a lot of new pilots soon.

BA should also tread carefully. At £60 million a pop, it would only take around 6 weeks of strike days to wipe out their entire profit for the FY. While I don't anticipate that happening, it is not difficult to imagine several week-long strikes if things get really nasty. BA could easily lose £1 billion over a couple of weeks of strike days, by which time the SP would probably be in the early 300s.

An intra-day 20% fall in the SP is the bad news.

Sorry, but if there ever was a time to panic it's probably now.

If we have learnt anything about this share, it is that double digit percentage falls are usually followed by calamitous news. Good luck to everyone still holding. If there is a slight upswing from here, it may be your last chance to get out with at least something.

By the same token, I think most BA pilots can afford to take the wage hit of an occasional one or two day strike.

As you alluded to, Hopeingmore, the pilots must be careful not to kill the goose that lays the golden egg. They have already lost some staff privileges from BA. I suspect many of the longer serving pilots, who appear to be leading the strike action, may indeed be quite heavily invested in IAG shares, so they will be taking a hit there too.

All things considered, however, it is likely that the company is suffering (reputationally and financially) more than the pilots are. I don't think it would kill BA to nudge their offer up to 12% "in recognition of the special skills and additional responsibilities that go with the BA airline pilot's role".

A few more strike days and BA will probably be heading for a £0.5 billion loss. Their reputation will be seriously damaged and the SP will probably end up in the 300s. It's just a question now of how far the pilots are prepared to push. They need to be careful that they don't shove BA off a cliff.

I think Pru and M&G will both do very nicely in the long-term - or even in the short-term. Research demonstrates that spun-off companies tend to outperform their former owner by more than 20% over the first three years following the demerger.

levelhead

I understood you perfectly. You wrote:

"Why should the tax payer get you out of trouble? Thats what you are ultimately interested in." Your comment was clearly directed at me, as you even used my handle as your subject title.

1. Where did I say the taxpayer should get me out of trouble?

2. My (financial) interest in SM ended on Fri 13 Sep when I sold all my shares at 10p (at 10% profit). Not gloating, just pointing out how idiotic your assumptions are.

levelhead

It was a joke. Do you seriously think I would propose boring a tunnel all the way from Woodsmith Mine to Germany? (eye-roll)

"Why is it that the German government is prepared to bailout the German part of Thomas Cook (Condor) to the tune of about £330 million yet the UK government does nothing?"

Perhaps SM should set a TBM course for 400 miles due east. (I've seen worse ideas for a bailout in the last 10 days.)

Perhaps the days of huge fluctuations in the Capita SP (with attendant day trading) may be coming to an end. The SP has been sitting above 140p for over 2 weeks now. IIs seem to be hoovering up the sells, leaving very few significant dips. With Capita on course to meet its 2020 targets, I think we will see the SP up in the 150-180p range in the new year.

While I understand BA's reasons for digging in its heels over the pilots' industrial action, it does seem as though BA is cutting off its nose to spite its face. An extra few tens of millions could probably have secured a deal and the SP would have been soaring by now. As it is, if the pilots call another strike (which seems more likely after today's trading update) we can expect the SP to nosedive.