Capital Raising, page-39

It's a safe short. While the price can do anything while the markets remain in a bubble the actualy real-life cashflow for Qantas is only going one way: out the door. They will simply have to raise cash somehow before too long, that's a simple and undeniable reality. Covid simply isn't going away (refer to what is currently happening in the UK where they have over 80% double vaccination rates) and while some recovery is coming it won't be enough to get Qantas back to profitability.

Now consider that Qantas has a higher enterprise value (market capital + net debt, for the holders who clearly don't know what this means) than pre-covid and ask yourself: is the global situation better for Qantas now than pre covid? Of course it's not. This is a nightmare scenario for an airline so blind freddy can see that it's in a bubble.

It's notoriously hard to time the popping of bubbles. But they always pop. I'm just enjoying the popcorn with every $50m that Qantas incinerates on a week-by-week basis knowing that they're running out of cash fast.