Let's Sell Qantas Shares?
We bought a number of QF shares back in 2013 ranging in price from 0.99 to 1.45 (average 1.21); with the share price hitting record highs this week it seemed like a good time to take some profits off the table.
Just sold some at 6.97, enough to get back all my investment and a small profit.
Now to decide whether to sit on the remainder or sell them; and at what price?
I am not a professional share trader - actually I am probably the most opposite thing there can be. So my opinion is probably worthless. But I comment this: (in random order)
1.- Qantas has had a stellar rise in share value. Despite all the backlash here on AFF, Qantas has managed to make a fair turn-around over the past few years.
2.- Despite many here on AFF hating AJ, he has managed QF to attain this increase in share price.
3.- There are ponderings, perhaps unfair, or perhaps very real, that AJ is guided by his own personal interest in short term share price and the windfalls this has brought him. In particular I note the ageing fleet - but maybe this is very sound airline management? There are so many airlines that think that fleet age and new product are king, no matter what cost.... That must really be an expensive way to compete??
4.- This is not a dot-com thing - there are real barriers to future share increases. IMHO airlines are always a dodgy area to invest in - too many non-core financial factors - and internationally QF have to compete with all those political things (subsidizing, etc) And domestically, I think they have flogged Virgin as much as our society will allow.
5.- A very specific and short term event will be the success or otherwise in Project Sunrise. If it is a success, I foresee that QF will maintain its share price and market existence. If it gets continually delayed or is a failure, a major reason for hope in QF's longevity in the international market will, in my very humble opinion, vanish.
6.- QF makes a lot of money out of domestic and Loyalty. I think they have probably reached, or are at least close, to the zenith of the Loyalty game. As for domestic, they already charge an absolute major margin for this semi-duopoly. Virgin also benefits from this. But I think there is no further margin. No real big growth in profitability.
So in summary I think QF have managed an amazing success story these past years, but I see no way that it will meaningfully grow even better. So sell your shares!!
In a wildly imprecise environment, I predict that with a successful Project Sunrise announcement, shares could go up another 50 cents. But no further. In absence of same I predict a slow and tortuous erosion - maybe about a buck a year in share value.
Anyway, maybe food for thought? Even if that thought is that I am an idiot
