FLT - Flight Centre Travel Group

[So_Cynical]

Re: FLT - Flight Centre Options

Can someone tell me where I can see a complete table of option strike prices and expiration months for stock options that trade for Flight Centre?

http://www.asx.com.au/asx/markets/s...nderlyingCode&underlyingCode=FLT&optionType=B

Aussie options are way more expensive to trade than US ones.

 

[persistentone]

Re: FLT - Flight Centre Options

http://www.asx.com.au/asx/markets/s...nderlyingCode&underlyingCode=FLT&optionType=B

Aussie options are way more expensive to trade than US ones.

The lowest option strike price is A$8 with the stock trading at A$5? Wow, that's amazing. I also note that the total open positions across all strikes is a whopping four contracts. There is no liquidity there at all.

That's amazing considering that Flight Centre is not a small company. You would think that the Aussie investors would value the ability to hedge positions, but maybe options there just are not as popular as they are in the U.S.

 

[skc]

Re: FLT - Flight Centre

Bit of an odd ball post........I was watching one of my favourite shows, "Californication (First Season)" and in one of the key scenes........just in background, I could see one of Flight Centres US stores........which I believe have all since been branded Liberty............

Anyway, I started thinking, here you have the US business with the greatest potential off any of FLT's markets, where do you think in FLT's current market capitalisation the US business sits........Since it's an overall loss maker, it's probable that a negative value is placed on it currently.....although I understand the 'business travel' in US makes a profit........it's a funny thing......picture all of FLT's employees in US going off to work each day in a business that would not exist if FLT worked off a franchise model......

I don't really see how the US business is running at an operating loss, I understand it's just write downs on the Liberty acquisition which was apparently solidly profitable on acquisition

Not many Aussie companies kick ass in the US but we keep going over there......It makes sense cause the rewards are so high.......and in an industry that I think naturally tends toward global domination (it's travel after all), I'd put a lot of money on FLT's US business churning out the equivalent of today's market cap ever year, in not a ridiculous future timeframe

I was watching another US TV series and saw some Centro shopping centres in a background and thought: This must be such a great company, it's on TV!

Jokes aside, the latest results seem to indicate the $15.7m Liberty loss consisted of $9m trading loss and the rest in one-off restructuring. They are doing lots of cost cutting and closing down unprofitable shops to try to turn it around. I couldn't find the US segment P&L to see how much cost cutting is needed before it can go back into the black.

Another interesting thing in the results. Of the $657m cash it holds, 3% are invested in CDOs. It says "The CDOs relate to US Blue Chip Corporations and not sub-prime". I wonder which Blue Chips they are referring to... Whilst 3% doesn't sound like much, it's actually ~$20m, so it's significant in relation to the overall size of their profit.

 

[JTLP]

Re: FLT - Flight Centre

Eeek...

FLT in a tailspin again today...down another 12%? Perhaps finishing on zi low did account for something.

I'm pretty Noob but it looks like its sitting on support from mid 97 and start of 99? Chart love from anyone who knows?

Any of you FLT Warren Buffet's buying up big now?

 

[gohawks]

Re: FLT - Flight Centre

Eeek...

FLT in a tailspin again today...down another 12%? Perhaps finishing on zi low did account for something.

I'm pretty Noob but it looks like its sitting on support from mid 97 and start of 99? Chart love from anyone who knows?

Any of you FLT Warren Buffet's buying up big now?

Thinking about adding a little more to my current holdings. Find it hard to see how i could go wrong. Then again the same was said at $7. :

 

[Gundini]

Re: FLT - Flight Centre

Eeek...


I'm pretty Noob but it looks like its sitting on support from mid 97 and start of 99? Chart love from anyone who knows?

Not sure if the support is much help at this stage JTLP. I jumped out of this plane a few weeks ago with a few bruises to show for it...

 

[ROE]

Re: FLT - Flight Centre

FLT is a good test for me to have the guts to stand where other jump ship or catch the falling knife
I load up more today ... prepare to buy more in the future if it down further

 

[prawn_86]

Re: FLT - Flight Centre

As i have said before i like these guys, but am waiting for a buying opportunity. The cutting of the div obviously didnt impress the market, but for those with a long term view it may prove to be a blessing in disguise (who knows really). Providing management use the cash well then cutting the div may be a good thing

They have plenty of cash, so they are not going broke anytime soon. In fact the could even make losses for a couple of years and still not need to raise capital.

Im still waiting to buy in, will probably look for some trend confirmation...

 

[skc]

Re: FLT - Flight Centre

They have plenty of cash, so they are not going broke anytime soon. In fact the could even make losses for a couple of years and still not need to raise capital.

Im still waiting to buy in, will probably look for some trend confirmation...

Those cash are not really their's to keep, as pointed out earlier by another poster. Have a look at their balance sheet.

Current Assets
Cash and cash equivalents $457m
Financial assets $187m
Receivables $319m

The first two items are their cash / investments, total some $640m.

Current liabilities
Trade and other payables $870m
Borrowings $72m

So you can see their cash / investments are to be paid out to their suppliers - namely airlines, hotels, tour operators etc. They get the customer's cash first and pay their supplier later. As long as they have more revenue next month, this can go on and they get to enjoy income from having the cash sitting in their bank account.

In fact, their quick ratio is just around 1. Whilst that's not a problem they are also not rolling in cash.

 

[nomore4s]

Re: FLT - Flight Centre

Guys you may have to take off the rose coloured glasses with this one for awhile. I can understand why you like this company and I did as well but lets be honest the results were less then inspiring, and cutting the d/e by 76% hasn't given holders holding from higher prices much incentive to continue to hold. And with current market conditions and sentiment against this sector the stock was punished accordingly imo.

This stock is now off my longterm investment watchlist as it no longer meets some of the requirements.

From a T/A perspective I now have a target of $3.00 but I think it may actually overshoot this. There has now been a lot of damage done to this stock from a T/A perspective and it will require a bit of work for a turn around.
While vol has been up the last few days there are no signs atm of any real support yet, FLT could continue to trend down for a while imo.

 

[persistentone]

Re: FLT - Flight Centre

So where do we get a complete report for the recent Flight Centre earnings release? Someone here made reference to a slide show. Where do we find it? I'm usually in US stocks and those have 10Q reports each quarter, and they get widely distributed by the press.

 

[persistentone]

Re: FLT - Flight Centre

Those cash are not really their's to keep, as pointed out earlier by another poster. Have a look at their balance sheet.

Current Assets
Cash and cash equivalents $457m
Financial assets $187m
Receivables $319m

The first two items are their cash / investments, total some $640m.

Current liabilities
Trade and other payables $870m
Borrowings $72m

So you can see their cash / investments are to be paid out to their suppliers - namely airlines, hotels, tour operators etc. They get the customer's cash first and pay their supplier later. As long as they have more revenue next month, this can go on and they get to enjoy income from having the cash sitting in their bank account.

In fact, their quick ratio is just around 1. Whilst that's not a problem they are also not rolling in cash.

It's the operating cash flow, not the cash on the balance sheet, that pays the dividend.

I have to see the presentation, but it looks like this quarter they had some one time restructuring costs? Can someone explain why they had operating earnings that were positive, but hugely negative operating cash flow? That's the opposite of their usual result.

 

[persistentone]

Stop Losses

Do they have stop losses on the ASX, and how do those work? Ideally I would like a stop loss that works like this:

If stock lowers to $X, then set a limit sell order of $X+$Y

What I am trying to avoid is setting a market order, which on an illiquid day would result in a very bad trade out.

 

[ROE]

Re: FLT - Flight Centre

If fundamentally dont change too much for this company, you see less and less shares exchange hand as people are loading it up and not letting it go...
Unless one of the existing big holder exit...the liquid on this stock at these price will be low.

 

[hotbmw]

Re: FLT - Flight Centre

man im so tempted to buy this at $4.

what would the p/e ratio be now?

remember this stock had a 1 time write off amount with liberty of 60m or so. cant remember exactly. and as other agencies fall in this environment FLT will pick up extra business.

 

[skc]

Re: FLT - Flight Centre

So where do we get a complete report for the recent Flight Centre earnings release? Someone here made reference to a slide show. Where do we find it? I'm usually in US stocks and those have 10Q reports each quarter, and they get widely distributed by the press.

Most annoncements are lodged to ASX and can be accessed here:
http://www.asx.com.au/asx/research/...panyName=&principalActivity=&industryGroup=NO

I have to see the presentation, but it looks like this quarter they had some one time restructuring costs? Can someone explain why they had operating earnings that were positive, but hugely negative operating cash flow? That's the opposite of their usual result.

Not sure but probably due to timing differences of accrual accounting vs cash flow statment. The P&L showed total costs of doing their business at ~$835m, whereas the total "Payments to suppliers etc" under cash flow statement was around $1,040m. Either they post-paid them a lot of money incurred from the period before, or they pre-paid them something for the following period.

man im so tempted to buy this at $4.

what would the p/e ratio be now?

remember this stock had a 1 time write off amount with liberty of 60m or so. cant remember exactly. and as other agencies fall in this environment FLT will pick up extra business.

Let's see. NPAT for half = $26.1m. Say full year = $55m. Total shares outstanding = 99.6m, so that's $0.55 per share. Latest price $4.4. P/E = 8.

Discl. I shorted this yesterday around $4.7, partially exited this morning at $4.15. Will probably re-enter the short if it gets close to my previous entry. My target is ~$3.5, based on the market pricing their dividend yield at ~6% (i.e. demand higher yield because of dividend uncertainty).

 

[persistentone]

Re: FLT - Flight Centre

Most annoncements are lodged to ASX and can be accessed here:
http://www.asx.com.au/asx/research/...panyName=&principalActivity=&industryGroup=NO



Not sure but probably due to timing differences of accrual accounting vs cash flow statment. The P&L showed total costs of doing their business at ~$835m, whereas the total "Payments to suppliers etc" under cash flow statement was around $1,040m. Either they post-paid them a lot of money incurred from the period before, or they pre-paid them something for the following period.



Let's see. NPAT for half = $26.1m. Say full year = $55m. Total shares outstanding = 99.6m, so that's $0.55 per share. Latest price $4.4. P/E = 8.

Discl. I shorted this yesterday around $4.7, partially exited this morning at $4.15. Will probably re-enter the short if it gets close to my previous entry. My target is ~$3.5, based on the market pricing their dividend yield at ~6% (i.e. demand higher yield because of dividend uncertainty).

Wouldn't a dividend yield at 6% based on a full year dividend of 16 cents put the stock at $2.66? Personally I think it was a bad decision for management to hoard so much of the dividend so quickly. They eroded their support for the stock and it will be trading at $2 to $3 before this over. They could have lowered a little each quarter if conditions in the economy did not stabilize.

Shorting a $5 stock that could one day receive a buyout offer above $15/share isn't my idea of easy money. I agree with your general thesis and targets, but you have unhedged risks that are multiples of your investment.

 

[nomore4s]

Re: FLT - Flight Centre

Wouldn't a dividend yield at 6% based on a full year dividend of 16 cents put the stock at $2.66? Personally I think it was a bad decision for management to hoard so much of the dividend so quickly. They eroded their support for the stock and it will be trading at $2 to $3 before this over. They could have lowered a little each quarter if conditions in the economy did not stabilize.

Especially considering the majority of shareholders would have brought in at considerably higher prices. It will be interesting to see if this decision will pay dividends (sorry for the pun in six months when they report the full year figures.

This is a pretty drastic measure by management imo, and indicates the outlook and/or current position for FLT is not all that rosey. But in the end it could prove to be a very prudent business decision.

Shorting a $5 stock that could one day receive a buyout offer above $15/share isn't my idea of easy money. I agree with your general thesis and targets, but you have unhedged risks that are multiples of your investment.

While FLT might receive a takeover offer at some stage it won't be at $15 while prices are this low.

 

[skc]

Re: FLT - Flight Centre

Wouldn't a dividend yield at 6% based on a full year dividend of 16 cents put the stock at $2.66? Personally I think it was a bad decision for management to hoard so much of the dividend so quickly. They eroded their support for the stock and it will be trading at $2 to $3 before this over. They could have lowered a little each quarter if conditions in the economy did not stabilize.

Their full year dividend tend to be higher than their interim (seasonality perhaps) - by 30% based on last year's numbers. So half year = 9c, full year = 12c. Giving ~21c and yield of 6% = $3.5.

Shorting a $5 stock that could one day receive a buyout offer above $15/share isn't my idea of easy money. I agree with your general thesis and targets, but you have unhedged risks that are multiples of your investment.

The same argument holds for any short trades so on this basis no one should ever short anything?! Besides, I don't intend to short-and-hold so the remote chance of a buyout offer at an unknown distant future isn't that big of a worry. I will take profit at target, or get stopped out as I move my trailing stop.

I hope FLT does recover one day as it is a truely great Australian story. There was an ABC show done on "Skroo" Turner about his early 70s top-deck ventures. http://www.abc.net.au/queensland/stories/s1107592.htm. They hired a dobule decker, toured around Europe without any local knowledge, and almost killed a busload of backpackers in the process...

Anyway, I can see no catalyst for this stock in the short term, and one shouldn't let nationalistic sentiments affect trading decisions.

 

[oldblue]

Re: FLT - Flight Centre

I like FLT as a business and as a company but with the SP and the market in the state they're in at present, the stock looks a lot more like a short than a long to me just now.