Monish Pabrai’s Q1 filing showed over 3.2 million shares of Pinnacle Airlines (PNCL). I highlighted his rationale in a previous posting and said you need to have a strong stomach to get into this stock and not to rush into it. Obviously, airline stocks have been hammered as a result of high oil prices and [...]
I had read about this a few months ago and have been watching it from 11 to now $6.5. Insiders are buying at this price and in large amounts at market (an indicator I always like). This regional carrier is an outsource for the majors and as such sign long term contracts regardless of passenger utilization they get paid. I do worry about fuel, and am looking into how they handle their fuel hedging. Also the pilot contract issue could be important. Overall for 5 years into the future cash flow and profits should increase as it makes less and less sense for large planes to make flights.
MOST NOTEWORTHY: PetSmart, Marsh & McLennan and Pinnacle Airlines were today's noteworthy upgrades:
Banc of America upgraded PetSmart (NASDAQ:PETM) to Buy from Neutral on valuation, as they believe the market is overly negative on the company's cyclicality.
Keefe Bruyette upgraded shares of Marsh & McLennan (NYSE:MMC) to Outperform from Market Perform on increased confidence management will be able to improve margins.
JP Morgan upgraded Pinnacle Airlines (NASDAQ:PNCL) to Overweight from Underweight citing the company's FCF and contract certainty.
OTHER UPGRADES:
Hasbro (NYSE:HAS) was upgraded to Buy from Hold at Needham.
Calyon raised Airtran Holdings (AAI) to Add from Neutral.
Liberty Entertainment (LMDIA) was raised at Merrill to Buy from Neutral.