Right now you can pick up AC for the same price as immediately after COVID. They had a rough couple of years but 2023 was profitable, they just averted a major strike, and they're trading at a P/E of 3.8.
On the face of it, it seems like a good opportunity. They had a massive run before COVID, peaking at triple their current value, and nothing has really changed about the company's position in the market. Canada is a difficult market to break into, with long distances between major cities and a relatively small population. Discount carriers routinely fail: most recently, Lynx. AC has a de-facto duopoly with Westjet, and fares remain stubbornly high. Compare that to the American market, where AA, Delta, United, and Southwest compete in a meaningful way, with a handful of discount carriers nipping at their heels.
Presumably the market is pricing in a lot of risk for AC to be trading at such a low P/E. Opinions?
Submitted September 29, 2024 at 11:36PM by badr3plicant https://ift.tt/ch1PvCu
