Shares to Sell 28 May 2010
Australain stock Virgin Blue Holdings (VBA) is a low fare Australian domestic airline carrier, has established international operations and provides holiday packages. Currently, it has a market capitalisation of over $700 million.
VBA has lowered its FY10 underlying earnings guidance to $20 – $40 million, from the previous guidance of $80 – $110 million.
VBA based the earnings downgrade on rapid deterioration in operating conditions, especially in its domestic and international leisure segments.
The latest earnings downgrade comes just three weeks after VBA announced that it expected earnings to be at the lower end of $80 – $110 million.
The worsening operating climate has coincided with increased industry capacity, causing VBA to lower its average fares expectation by over 10%
The share market wasn’t too pleased with the announcement, with VBA shares sinking almost 30%.