Forum Archive Index - May 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Positively the worst prediction made on sharechat this year must have 
been mine that AIR would be trading at only 15c by the end of it.   
In fairness, there are still seven months to go, so my prediction may 
yet come true.  But given Air New Zealand shares are gliding along at 
55c or so, this doesn't seem likely.

55c is the equivalent of $3.05 prior to the restructuring.   This for 
a company that is now crippled with debt and barely breaking even.  
Even if the restructuring goes according to plan, don't even mention 
the word 'dividend' for at least five years.   55c is 49% higher than 
the highest 'fair value' (37c) attributable to the company in the 
Grant Samuel independent adviser's report issued 30th November 2001.

The word is that the reason the price is flying is that index fund 
managers are striving to buy up the shares, to make up the required 
weightings in their index tracking funds.  But buying something 
because it is there is rarely a wise strategy for investment.

My AIR investment strategy was to hold onto my small residual parcel 
so I got all the documentation sent to me and dive into the rumoured 
up coming rights issue hoping to pick up a good sized holding at 10c 
a share or so.   But with the share price rising to 55c and even 
higher in the recent past, the case for sale became compelling - so 
I'm now completely out.  I think my chances of picking up shares at 
10c each are pretty close to zero now.

I notice there are a lot of AIR punters out there in the Stock Guru 
competition, and most of you are at the top of the list.  Obviously I 
was wrong in my assessment of AIR at the start of the year, so 
perhaps I am wrong again.  Any of you like to comment?

SNOOPY


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"You can tell me I'm wrong twice, 
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