American Air’s $1 Price Target at Evercore Implies 92% Collapse

I have no particular opinion on what the share price &quot;should be&quot;, but apparently the analyst (MD) making this prediction is ranked here: <a href="https:&#x2F;&#x2F;www.tipranks.com&#x2F;analysts&#x2F;duane-pfennigwerth" rel="nofollow">https:&#x2F;&#x2F;www.tipranks.com&#x2F;analysts&#x2F;duane-pfennigwerth</a><p>I quite like this idea of ranking people based on their prior predictions! Again, no idea about any of the specific subject matter or the people covering it, but certainly an interesting site.

These bailouts need to be punitive to investors or behavior doesn’t change. We need these bailouts to keep people employed and to maintain the infrastructure&#x2F;service, but if you take a government bailout, it should be automatic chapter 11, automatic equity wipeout, and government $’s should look like DIP financing...or something like that... watch balance sheets become more conservative in industries that need a bailout every ten years

IMO: transportation bailouts should be focused on essential everyday services (e.g. public transit, which is currently hemorrhaging money) and not for a mode whose purpose is to facilitate business trips and vacations

~$29 on January 1st, 2020. A $1 target is pretty brutal. Though, for airlines, bankruptcy isn&#x27;t all &quot;bad&quot;. It invalidates their labor contracts, and allows them to renegotiate in an environment where they have a lot more leverage.

I was thinking the other day about how American companies have continually gorged themselves on debt even after so many crises have been made so much worse by unhealthy balance sheets. I guess the taxpayer has always got their back. These are state owned enterprises in sheep’s clothing.

Why is one analyst&#x27;s opinion news? The market still thinks their stock is worth $10.

Airlines have always been a pretty crap business to be in. Older (hilariously formatted but still good) thoughts here: <a href="https:&#x2F;&#x2F;www.mcgill.ca&#x2F;iasl&#x2F;files&#x2F;iasl&#x2F;ASPL614-Airline-Financial-Woes.pdf" rel="nofollow">https:&#x2F;&#x2F;www.mcgill.ca&#x2F;iasl&#x2F;files&#x2F;iasl&#x2F;ASPL614-Airline-Financ...</a>

Buying a debt-laden airline and trimming the fat + increasing yield while getting leverage on partners and expanding logistic capacity sounds like the ultimate Amazon move right now. Probably not AA, but I don&#x27;t know... Southwest?

Obligatory joke: How do you make a million dollars in the airline business? Well, you see, you <i>start</i> with a <i>billion</i> dollars...<p>(real talk, who actually buys these stocks? they keep going so very bankrupt...)

The fed bailed out the fucking junk bond market, but we&#x27;ll see lots of legit companies go bankrupt in the next few years as this plays out.<p>Politicians have confused the shutdown. It was intended to reduce the likelihood of overwhelming the hospitals, but it seems it&#x27;s been interpreted as protecting people from getting infected. That was never going to happen, but nobody wants to talk about it.