Airlines - Which Survive Without Going Through Bankruptcy

[ivinsfan]

I never studied bankruptcy law, but why would anyone buy airline stocks going forward if they are going to declare bankruptcy and wipe out the stock holder every 10 years. Why did Buffet? I can see lending money as this can be accounted for in the interest rate to some extent, and you do end up with a chunk of the company and I would guess a lean on the assets after the dust settles.

Good question because the last two events came out of the blue and were catastrophic. Less stock buybacks by the airlines would have helped in present day but slow and steady never wins you fans on Wall street. Now they can screw over both their creditors, Wall street, and not to mention the fallout for the employees.

 

[Starsky]

Here is a video of an analysis of Air Canada's quarterly reports. It is a nice template for reviewing any airline's financial statements...

Looking at current assets vs. current liabilities and owner's equity, even companies like Delta look very weak. They have incredible cash flow requirements.