Molson Hart

$HA Hawaiian Airlines: Pros: Near book value Low debt 6x earnings 3x ops cash flow 20% ROE Cons: CEO compensated for growth Airline biz isn't wonderful Overall, seems stupidly cheap down here. Today's sell off is from the virus outbreak in China, ~200 infected so far.

If it’s not levered, why is ROE so high? What is ROIC? I would be worried they are massively over-earning on a couple of routes and thus susceptible to competition. But maybe that’s the comp advantage (key routes). Thx for highlighting

$LUV started competing against their intra-island monopoly. Before that, ROE was even higher. If that works out well for $LUV and they expand, ROE will likely compress further. On the other hand, competitors have given up before.

$HA will have the only direct route between many cities and Hawaii, which is a natural advantage. There just aren't enough people that want to fly directly to Hawaii from a given city to support multiple flights. Seems like a reasonably robust advantage.