–
Private investor Nicolay Grove owned two million shares in the airline Flyr through its wholly owned company Ørn as. Last week, he chose to sell out completely.
– Of course, I was initially positive to Flyr because I thought that SAS and Norwegian had lost so much money for so many years that they would not take up the competition on price with Flyr, but it seems that they have done anyway, he says.
On Monday, the Flyr share plummeted, ending with a decline of over 20 percent. It happened after the company reported on a sharp deficit in the third quarter, which was the first quarter of operating operations in the company.
At the same time, Flyr stated that it will raise NOK 250 million in fresh capital by issuing shares to existing shareholders, a so-called rights issue.
– You may just have to stay away
Earlier Monday, DNB Markets presented an analysis of the airline. Analysts Ole Martin Westgaard and Simen Aas believes the news the company presented on Monday is a sign that the business model is not working. At the same time, the two analysts called Flyr a loss-making project.
–
Investor Grove believes it is too early to conclude whether the company has a well-functioning business model.
– It is too early for me to draw a conclusion whether that business model works or not, but they choose to raise money, and with accelerating deficits it can be more difficult to raise money later at a reasonable rate, he says.
At the same time, Grove is reluctant to ask whether it is a good time to trade Flyr shares after today’s sharp fall in prices.
– So if the Flyr share falls further then there is not necessarily any sign to buy, you may just have to stay away, he says.
Increased infection rates
Grove believes it seems to have been a good decision to sell out last week, but emphasizes that the main reason he sold was that the number of corona infections is now increasing.
– I sold out of the company in the middle of last week. The reason was that the infection rates are now rising, and even if the authorities will not come up with a total shutdown again, it will put a damper on the desire to travel and it will hit the aviation industry hard again, he says.
When he bought shares in Flyr, it seemed that the reopening of society was in full swing, and he envisioned that air traffic would pick up sharply again.
–
– I thought we would get a real boost in air traffic and that for once it would be profitable to be an airline shareholder, but the reopening has come much slower than we thought, says Grove.
Monday reports NIPH that 198 coronary heart disease patients are hospitalized. This is the highest number since April this year. FHI also reports that the infection trend is currently increasing. (Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We want you to share our cases using a link, which leads directly to our pages. Copying or other use of all or part of the content may only take place with written permission or as permitted by law. For additional terms look here.
–
