Friday, April 17, 2009

MarketWatch - Auckland International Airport




Auckland International Airport [AIA.NZ] is presently a well underrated stock, for a number of reasons. It, like every either stock on the NZX, is getting a pasting by nervous investors and post the merger hubbub the share price has tanked.

OK, I do own this stock but it is pretty immaterial really, I only own 1000 shares, so if you do rib me just make it a small ribbing if you would.

I bought my shares at $2.15 and at today's closing of $1.70 (I originally started this yesterday when AIA was at $1.64) it makes the company a cheap proposition. $1.56 is its 52 week low. (see 2 year chart above for details)

Just over a year ago they were fetching more than $3.60 due to competing bids to buy a share of the company.

Lets forget about the share price for a moment though, even though that is the main reason for this particular column.

For $1.70 per share what do you get?

* An essential monopoly with the ability to raise prices consistently above the rate of inflation.

* Add-on revenue streams from large retail areas inside and outside the port proper.

* Large tracts of undeveloped land surrounding the port.

* Consistent organic growth through increased passenger movements.

To add to this there has been a softening in National Government policy to allow assets like these an easier saleability to overseas interests; Previous Government regulation led the AIA sale to fall through.

In addition to the above point and politics again I'm afraid, with the imminent "super city" about to dawn on Auckland the question of airport shares being held by Auckland and Manakau City Councils will definitely come up again.

Regardless of the short and long term propositions that I have pointed out for owning this stock you will have to make your mind up whether you want to buy Auckland Airport stock but I rate it a buy at these price levels.

Auckland International Airport @ Share Investor

Why did you buy that stock: Auckland International Airport
Cullen's move on Auckland Airport has far reaching effects
Cullen's move on AIA tax plan Anti-Business
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

Discuss this stock @ Shareinvestor.net.nz


Related Links

AIA Financial Data


Related Amazon Reading

Gaining and Sustaining Competitive Advantage (3rd Edition)

Gaining and Sustaining Competitive Advantage (3rd Edition) by Jay Barney
Buy new: $133.75 / Used from: $44.99
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c Share Investor 2009