CAL stock up 250% in last 12 months

[BluDevAv8r]

By lowering CASM don't you get a higher RASM?? I think we are saying the same thing in different ways. I should have said CASM but I was sticking with RASM since that was what they were talking about earlier in the post. This thread is getting really boring now with CASM, RASM, shorting, and sell stops coming up!

Boring to some perhaps but at least it is discussing factual information for once. And to answer your question, no, lowering CASM doesn't give you a higher RASM. Two different (but mildly related) concepts. RASM is the total revenue line (money generated from sales) divided by the total ASM's. CASM is the total expense line (costs) divided by total ASM's. They measure different things. Airlines like SWA tout their CASM (low cost structure) while airlines like CAL tout their RASM premium (ability to generate the highest revenue per seat mile.

-Neal

 

[Uniform Shop]

Cal has more debt than most legacies

I don't think CAL has more debt than most legacies but maybe I'm just reading the chart wrong.

CAL is about half the size of AA. Look at UAUA's liabilities. Holy crap!!

 

[acbarney]

the notion that a loss on a short is unlimited is incorrect if standard Stop-Loss orders are used, just like a regular "long" buy.

A long investor will buy Stock ABC at $20 and place a Sell Stop at say 10% loss point, or at $18. If it hits 18, he is out, done, no questions asked. Hopefully of course, it goes up.

A short seller will short Stock ABC, at say $20, and place a Buy Stop (reverse of Sell Short) at the 10% point, which is $22, or a 10% gain on the $20.

If it goes up, against his bet that it will decline, he is out when it hits 22 bucks, no questions asked.

If the stock continues to go up to $500 a share, he is long out of it back at the 22 dollar mark.

Unless it gaps your $22 stop loss, or there are not enough shares to buy back at $22....don't think it can happen??? keep doing what your doing, you'll find out.

Puts are a much safer way to short a stock.

 

[GogglesPisano]

CAL has net tangible assets of $10.5B and total liabilities of $10.3B. http://finance.yahoo.com/q/bs?s=CAL&annual. Total revenue in '05 was $11.2B with a $1.5B profit.

AMR has net tangible assets of $29.5B and total liabilities of $30.9B.

UAUA has liabilities of $45B.

 

[satpak77]

Unless it gaps your $22 stop loss, or there are not enough shares to buy back at $22....don't think it can happen??? keep doing what your doing, you'll find out.

Puts are a much safer way to short a stock.

your points are credible however a gap will still trigger the stop order. It does not need to physically tick thru 22.00 dollars. It is "22 or more", at least with my broker.

Gaps are uncommon (but still occur) on larger cap issues and more common on smaller cap issues. A gap occurs because of sudden, congested, all-at-once buying or selling pressure that exists.

I have been investing in stocks and commodities for over 10 years now, and make more doing that than my day job, but thanks for the words of advice.

My day job provides a retirement plan and medical insurance, so yes, I am keeping it. Can't rely on the markets to pay the bills. If you make money from it, great, high-five yourself, but keep the day job.

Merry Christmas

 

[acbarney]

your points are credible however a gap will still trigger the stop order. It does not need to physically tick thru 22.00 dollars. It is "22 or more", at least with my broker.

Gaps are uncommon (but still occur) on larger cap issues and more common on smaller cap issues. A gap occurs because of sudden, congested, all-at-once buying or selling pressure that exists.

I have been investing in stocks and commodities for over 10 years now, and make more doing that than my day job, but thanks for the words of advice.

My day job provides a retirement plan and medical insurance, so yes, I am keeping it. Can't rely on the markets to pay the bills. If you make money from it, great, high-five yourself, but keep the day job.

Merry Christmas

"22 or more" works to stop your unlimited loss, however it doesn't give you a guaranteed max loss at the beginning of the trade, like a put does. You can use spreads to further limit your loss with options, but you also limit the upside.

Large caps do not frequently gap, however, they do occasionally. Look at CAL or any airline at the open last wed.

I wasn't trying to pick a fight, just offering a little hard won knowledege. You didn't mention the "or more" part in your first post. Most avg Joe traders "investors " don't understand the gap thing when they place a stop loss and are left holding the bag at the end of a particularly violent overnight announcement.

Absolutely agree on the "keep your day job"

Merry Christmas

 

[Pat Fabin]

CAL Sucks.

 

[atrdriver]

Well Cal is the best run Legacy out there. Our product is the best

I believed that right up until they hired you.

 

[Andy Neill]

CAL has had a very good run. But when the market opens, I'm going to buy Dec $50 puts for $5.60 each. The more it goes down from its current $44.97 price, the more those puts will be worth. I'm betting they will be worth $9-$10.00 by the end of the week. I will post within a half hour of when I sell the puts.

Just sold those puts for $7.80 for a total profit on those 4 contracts of $880 in two trading days. Hey you're right. You CAN make money on CAL. I had hoped to ride the CAL stock price down t0 $40 but got booted out on a stop loss.

I also bought 7 Dec 45 Puts at $3.10 the same time I bought the CAL puts. They are currently valued at $3.90 (unsecured profit = $560 in two days).

I'd gladly go long on CAL at 39-40 if it comes down that low.

 

[Flyby1206]

damn i need to learn how to do options trading

 

[WMUSIGPI]

That's what everybody said before 9/11, apparently all the other companies are more highly leveraged and have more debt. Sadly, this appears to be business as usual in corporate America these days.

Even more sad, this isn't just a problem for corporate America. Private Americans are hurting even worse with debt.

 

[bizicmo]

Me too

 

[Andy Neill]

Just sold my 7 UAL Puts at $4.90 for a $1260 secured profit in 3 days. I'll go back to my room now.

 

[Andy Neill]

Bought three Jan $40 calls on CAL at $7.20 at 10:12 ET.

See if I can ride this both ways.

 

[bizicmo]

Andy Neil any advice on reading material to get to where your at as far as knowledge and comfortability in the market.

 

[pkober]

CAL Sucks.

And the most smartest post of the day goes to Pat Fabin. Congratulations on winning the free set of ginsu knives.

 

[Pat Fabin]

I'm just happy to be noticed. I try to keep my posts pithy!

 

[pkober]

excellent!

 

[Andy Neill]

Andy Neil any advice on reading material to get to where your at as far as knowledge and comfortability in the market.

UtahPilot recommended Investools to me and I took him up on it last January. I did paper trades till mid April then started investing for real. I have been investing full time for 2 months without a drop in pay.

Contact Utahpilot. He could probably get a kickback if you go into it. I don't need it.

I'm planning on selling when CAL gets to at least $45.96. (Monday then an additional $0.35/day after that).

www.investools.com

 

[Andy Neill]

Closed out my CAL calls at $6.70 (-$150). Obviously it would have been better to bail a couple of weeks ago when it was over $11.