ASA 401k/SKW stock

[shamrock]

Just curious what you guys think of SkyWest stock in our 401k.

Are you going to buy it?

 

[Rogue5]

Do you get any discount on it? SKYW's ESPP takes the lowest price between beginning and end of a six month period and purchases stock at 85% of that price for all money set aside by the employee over that period. Conversely, the SKYW stock that may be put into a 401(k) is not offered any discount.

I don't know about you, but I don't want ANY airline stock as part of my retirement nest-egg. I max out the ESPP and dump the stock the day after the purchase (guaranteed AT LEAST 15% profit every six months, this period more like 40%), but leave SKYW stock out of the 401(k) completely...

 

[shamrock]

Do you get any discount on it? SKYW's ESPP takes the lowest price between beginning and end of a six month period and purchases stock at 85% of that price for all money set aside by the employee over that period. Conversely, the SKYW stock that may be put into a 401(k) is not offered any discount.

I haven't heard anything about a discount so I wouldn't think there would be one.

I'm inclined to pass on the SKYW stock, I was just curious what others may think of it.

 

[satpak77]

Are you required to buy it? What other options do you have? Ask 10,000 Enron employees your question....

Invest in multiple good stocks in your 401(k), not your employer. The Enron employees also got a "discount" and a "good deal" on their stock.

The Enron trial starts end of January...

FYI

 

[~~~^~~~]

ASA is probably headed for a strike and possible shut down. Why would you want to lose your job and watch your 401K tank concomitantly? I would stay out of aviation stocks in general and out of Company stock in particular.

 

[shamrock]

I'm not buying it, I was just wondering if anyone else is since SkyWest is supposedly such a profitable company.

My 401K has done just fine without any Delta stock so I'm fine sitting this offer out as well.

 

[Dave Benjamin]

I follow SKYW stock pretty closely and have had some good experiences short term with it. The only stocks I hold long term are well diversified blue chip stocks like GE and Boeing. As others have pointed out any airline stock may not be the best thing to have a big chunk of in your 401K. SKYW employees have a 423 plan which allows all employees to buy stock at a discount. Since there is no requirment to hold the stock short term profits can be easily realized.

See http://www.skywest.com/careers/benifits_sum.php which explains the plan. If the stock appreciates sharply during the course of the year some employees will enjoy a very large profit. For instance the stock was around 18 at the end of June which means the purchase price for stock currently going for nearly 27 will be 15 and change. If a captain making 80K took full advantage he'd see close to 5 grand in additional income just for the last 6 months of 2005. If the stock had gone down below the purchase price in June he'd only see a profit of around a 1000 bucks which is probably adding over 2 bucks an hour to his earnings before taxes. So the results may vary. The only thing that's guaranteed is 15% ROI of up to 15% of gross. Keep in mind that short term stock gains are taxed at a higher rate than ones you hold for 2 years or longer so some of the handsome profits go straight to Uncle Sam.

Here is the 423 plan description taken verbatim from the publicly available info on the SkyWest corporate website.

423 Employee Stock Purchase Plan
The 423 Employee Stock Purchase Plan provides SkyWest employees with the opportunity to buy SkyWest, Inc. common stock through payroll deductions. SkyWest pays the fees on the purchase, and employees receive a 15% discount when the stock is purchased every six months. Full and part-time employees are eligible to participate in the plan beginning with the next purchase period following 90 days of employment.

 

[CoATP]

If your plan is self controlled there should be a stop-loss on all stocks. If you don't control it ... be careful. Of course I say this after having a bunch in Lucent (after all it was Bell Labs and NOTHING can happen to the phone company .... sigh)

 

[puddlejumper101]

the way I see it I have a lot invested in ASA already...its called my job...why would I invest further on them for my retirement? I was taught to never invest the company you work for in your 401K

 

[Going2Baja]

In three years of taking advantage of the ESPP I made $30k and put it all down on my house. It's really a no-brainer! (1994-1997)