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VisualMod t1_j298iow wrote

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Total Submissions 0 First Seen In WSB 6 days ago
Total Comments 16 Previous Best DD
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^^Discord ^^BanBets ^^VoteBot ^^FAQ ^^Leaderboard ^^- ^^Keep_VM_Alive >TL;DR: Southwest lost over 2 billion dollars in 8 days

1

Diligent_String1966 t1_j298ni1 wrote

Closing shorts before they get some dumb fucking bailout package from the federal government.

48

bythepowerofboobs t1_j298uqz wrote

Up less than a percent is mooning? Also since when have stock values ever been related to company profits? It's always been about potential revenue growth in this world that makes no logical sense.

16

Impossible_Trade_245 t1_j299lhm wrote

It is outrageous. My conservative puts are sinking on this. My calls sinking on the other stocks since most of the market is down.

But this LUV is pumping like they nailed Holiday Travel and updated their systems. It is so absurd.

Literally makes no sense.

2

OhNoNoNoAveMaria OP t1_j299z2i wrote

Replying to Diligent_String1966 (#1,184,494)

I understand why they would bail out the industry as a whole, but this is just one company, with a very negative image right now. Every other airline is fine and running smoothly, so it would look pretty ridiculous if Pete Butt Plug swooped in and bailed out one company for fucking up massively on it's own accord.

0

FlyPenFly t1_j29aqkp wrote

MM and algos see retail making obvious news based moves… they all jump in like coordinated wolfpacks to counter that narrative.

1

funkymonkeybunker t1_j29b0ms wrote

Too big to fail... Bad performance just means its time for a tax funded cash injection.

4

Kunyun19 t1_j29bhis wrote

To big to fail blah blah, bailout on deck

1

Select_Ad_4719 t1_j29bm3y wrote

Because we bought puts. Except mines on AAL 🤦‍♂️

1

covasverity t1_j29c62c wrote

Lmao wsb ogs know mooning is a 3000% increase in premarket you God damn newnoob.

3

Background_Lemon_981 t1_j29cfme wrote

Press, even bad press, puts the company in people’s minds. Since there are vastly more people that don’t own Southwest than own it, some of those people buy. And far fewer who own it sell. The overall balance is towards the buy side. I’ve seen this happen many times.

3

bob_miller_jones t1_j29cgwv wrote

Where did you see they lost money? They cancelled flights AFTER getting paid.

It's up to the consumer to obtain a refund and that process sucks.

Cancelled flights are a windfall for airliners

1

xSaRgED t1_j29cygy wrote

Where in the fuck are you getting $250 profit per customer? Last time I flew southwest (three weeks ago), it was $100 round trip.

1

PizzaNuggies t1_j29d432 wrote

I don't think they are comping people 600 dollars a piece. They are going to do as little as possible until the government forces them to do something. And our government is ran by corporations, so good luck with any sort of justice or compensation for most people that were impacted.

1

FewCelebration6809 t1_j29d9gq wrote

F southwest, so glad I never fly them and these recent events convinced me to never try. Southwest will get no luv from me. I'm surprised their stocks didn't go down enough even with the recent negative news cycle (United went down wayy more for beating up this one passenger a few years back I think).

1

Mytyeve123 t1_j29da1o wrote

Bankruptcy then split into pieces for the “Big 3” to grab up making even more of a “monopoly” 🤷🏼‍♂️

1

joevan55645 t1_j29dc22 wrote

Replying to OhNoNoNoAveMaria (#1,184,710)

But that's the thing, if you have been short this stock for a few weeks. That's an absolutely terrible headline. You're up quite a lot on your short. The momentum was strongly to the downside. These are all things I would notice for a cover.

1

LiberalAspergers t1_j29eop2 wrote

Replying to bythepowerofboobs (#1,185,641)

If you bought every airline at IPO for the past century and held, your portfolio would be showing a loss. Not an inflation adjusted loss, but an actual loss. This industry destroys shareholder value consistently. That during the longest economic bull run in the US's modern history, they managed not to loose money is hardly a ringing endorsement.

1

LiberalAspergers t1_j29fggp wrote

Replying to bythepowerofboobs (#1,185,958)

And they have over the past few decades been one of the least bad companies in the industry. But, inevitably competitors will go bankrupt, and continue operating without the full cost of their capital, and launch a fare war, which is what always destroys this industry. Even the best company in the worst industry in the world is still a bad investment. If the P/E drops to 2 or less, it could possibly be called overvalued. Until then, nope. There is no value in that industry.

1

LiberalAspergers t1_j29gifk wrote

Replying to bythepowerofboobs (#1,186,143)

Long run, looks like their return on Capital is around 5.5%. That is not extremely profitable by any standards other than the. airline industry. It is AMAZING for an airline, but that is kind of like getting the best grades in a special education class.

2

CXXIF t1_j29htj5 wrote

It was priced in years ago brah

1

LiberalAspergers t1_j29i6oi wrote

Replying to bythepowerofboobs (#1,186,541)

Depends how much capital you use to make those profits.

Same as investing. Making an annual return of 100,000 is amazing if.you only have 400,000 in capital. If you have 40,000,000 in capital it is terrible.

And given that interest and depreciation are two of the major expenses airlines face, EIBTDA is a terrible.measure for that industry. But, good luck.

1

2021newusername t1_j29p4qm wrote

you’ll make a lot more money in the market by doing the opposite of what common sense suggests

1