Will QAN survive?, page-285

While I think that this is fairly accurate - what about the enormous risks to Qantas (even once this recovers)?

- Significant decrease in demand for travel. Sure the usual types will want an overseas holiday, but even this will be reduced by the number of people unvaccinated, overseas government caps on passenger numbers etc.
- The all important domestic business travel market is basically gone. Corporates are unlikely to fly in the same numbers as they previously did. Some companies have scrapped travel altogether and invested in technology to improve the video meeting experience.
- Debt burden - granted interest rates are tiny, nevertheless they must be carrying an enormous amount of debt now?
- Employee satisfaction - I know plenty of current and ex staff who were recently made redundant. None of them received a call to mark their decades of service. The pilots hate Joyce with a passion and the first chance they get to bring him down through industrial action, Joyce is gone.

Sure, QAN are helped by Virgin's troubles, but it's fair to assume Virgin's new owners have learned the mistake of over complicating the business and not having a firm grasp on where Virgin fits into the Australian aviation market. A streamlined model in terms of aircraft type and a better strategy in terms of offering is likely to see Qantas and Virgin get back into the old capacity war which will drive ticket prices down and along with ticket prices goes yield, margin, and any returns for share holders who got into QAN because 'Qantas is safe as houses bro'.

Time will tell if I'm just being a bear on QAN but I personally see a fair value SP of $4 into the next few years. Anyone who got in above this had better have a strong mind.