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Strategies & Market Trends : Classic TA Workplace

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To: reaper who wrote (70483)4/5/2003 1:09:32 AM
From: Spekulatius   of 209892
 
AA looks indeed very weak. Their debt has increased from 6.4B$ to 8.7B$ during the last year, even though the business in contracting the Capex is higher than depreciation. During the last 5 years, debt has almost increased 3 fold starting from 3.0B$ in 1997. The question is how much longer are the banks wiling to let them borrow for paying their dividend. in their best year they ever did earn 1.81$/share, so based on that the stock trades at not so cheap 11 times peak earnings. Looks like somebody ought to tell AA's management that they are running a crappy business...
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