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Old 04-18-2017, 10:55 AM   #561
ernie
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huge drop today for United Airlines stock. Down 3.65%. Not sure if it will rally or not.

That translates to a 1.082 Billion Dollar drop of their market cap from before the incident.

Who'd have thought that investigations from the Department of Transport in both Canada and the US would be bad for business?

I guess the whole market must not understand the airline business.

Update: From when I started typing this post to now, it's down 3.76%. Based on my math each 1% drop is about a $230 million dollar drop. So a 0.1 drop is a 23 million dollar hit.
well, you know, dragging one passenger off so 100 can fly out the next morning is simple airline math.

oops.

So it seems breaking humans costs ~6 times as much as breaking a guitar. United better hope there isn't a dead puppy in a cargo hold somewhere....

Last edited by ernie; 04-18-2017 at 10:59 AM.
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Old 04-18-2017, 01:05 PM   #562
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So it seems breaking humans costs ~6 times as much as breaking a guitar. United better hope there isn't a dead puppy in a cargo hold somewhere....
After the guitar incident, stock only briefly dropped and actually increased beyond the "starting point".
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Old 04-18-2017, 02:10 PM   #563
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After the guitar incident, stock only briefly dropped and actually increased beyond the "starting point".
Yes well aware. That's what stocks and the stock market typically do. But such drops have very real implications for real people and companies. Even if the drop is temporary as they often are.

And it's worth remembering that this is the airline that in very recent past messed up a merger, had a scandal forcing a CEO and two other senior executives to resign, and have had a seemingly revolving door of CEOs. Further bad press doesn't help them as they've been trying to right the ship. This is a stock that has basically doubled in price since the hardships a few years ago. Sinking back down to those levels again would be huge (not saying they will).

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Old 04-18-2017, 02:20 PM   #564
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Yes well aware. That's what stocks and the stock market typically do. But such drops have very real implications for real people and companies. Even if the drop is temporary as they often are.
My point was that 2009 was obviously a more volatile time for airlines; many were doubting whether the initial drop could even be attributed to the guitar song (which is quite catchy by the way, check it out if you haven't heard it)
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Old 04-18-2017, 02:33 PM   #565
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My point was that 2009 was obviously a more volatile time for airlines; many were doubting whether the initial drop could even be attributed to the guitar song (which is quite catchy by the way, check it out if you haven't heard it)
Gotcha. I don't really think the song did much of anything to the stock price that was already sinking for the reason you mentioned. I was just mentioning it as it's pointed out as a reason they lost $280 mil in stock value.

This time it might have an actual effect though long term trends tended to have the stock overvalued and looking to drop to $60 per share or so already. This may hasten that which isn't a good thing as a rapid decline can be harder to stop.

What saves them is the way airports are always a hub for one of the 4 major carriers. You want to fly out of Dallas your best bet is American. St. Paul you take Delta etc. Choices are limited without going to different airports or limiting options.
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Old 04-18-2017, 03:32 PM   #566
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The other thing that limits the negative affect is that travelers already have a terrible perception of airlines and at the consumer level where sentiment might play a factor shop on price.

Business again will be convenience, comfort, price in some order then perception of the airline.

So from a actually usage standpoint they should be relatively unaffected. Though that only has a moderate impact on stock price where perception is as important as the underlying analytics.
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Old 04-18-2017, 05:11 PM   #567
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I think the trigger for the stock today is that some reports came out (including the Wall Street Journal) that corporate clients of United are demanding their policies be reviewed.

Stock finished with a 4.27% drop today alone. From where it started prior to the incident, that is a 1.22 Billion Dollar drop in market cap.
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Old 04-18-2017, 08:05 PM   #568
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'they (did not) overbooked'? What's with these egregious parenthetical-based errors in thread titles, CP?
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Old 04-18-2017, 09:53 PM   #569
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'they (did not) overbooked'? What's with these egregious parenthetical-based errors in thread titles, CP?
Hush now. Or else....

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