Connect with us

Hi, what are you looking for?

Technology

What Air Canada’s Bailout Means for Investors

Air Canada (TSX:AC) suffered because of the COVID-19 pandemic, however, shares have recently soared and have been a popular option for investors. Since March 2020, stock prices have doubled and investors are very optimistic about the future of Canada’s largest airline.

Air Canada acquired a bailout deal (a relief package) worth $5.9 billion that comes with specific stipulations. This deal includes both equity financing and low-interest loans, making it a huge win for Air Canada. However, there are conditions attached to the deal that requires the company to resume regional routes, refund tickets, keep its aircraft orders, and ensure job protection.

The federal government acquired a stake in Air Canada, after bailing out the company and investing about $500 million. Accordingly, the company will be issuing more than 21 million shares.

Government bailout was crucial for Air Canada’s survival

The company is facing a lot of uncertainty, however, this bailout was crucial to its survival. The relief package, provided by the federal government, will boat liquidity position. Furthermore, low-interest loans and equity investment will de-risk the balance sheet, which is great news for investors.

Passenger aeroplane of Air Canada on airport
Since March 2020, stock prices have doubled and investors are very optimistic about the future of Canada’s largest airline.

Factors such as share dilution, equity financing, and jet fuel pricing, can impact a company’s chances of experiencing profitable growth. Although there have been fluctuations in the past week or so, investors can view these fluctuations as good buying opportunities. Air Canada is a top buy for people who are optimistic regarding a surge in demand for air travel once the government lifts the pandemic-related restrictions.

You May Also Like

Blog

An investor’s best friend is the candlestick chart, which you can use to identify trends in stocks, commodities, and currencies. The most reliable patterns...

Technology

The blog post breaks down what are candlestick patterns, how to read easy to see patterns, how candlesticks are formed, how to read charts,...

Diversified Industries

This blog breaks down the essential candlestick patterns that will help traders with investing. Also, investors are encouraged to look into the body, wick,...

Diversified Industries

In this blog we explore the top 6 unknown and cheap stocks for millennials to invest in. This list includes: Zynga (NASDAQ:ZNGA), Franks International...

Investor Scene

InvestorScene.com, a leading financial news informational web portal designed to provide the latest trends in Market News, Investing News, in-depth broadcasts on Stock News, Market Analysis and Company Interviews.

InvestorScene.com also provides financial news PR marketing and advertising for third parties for disseminating news and original content through our unique media platform that includes Newswire Delivery, Digital Advertising, Social Media Relations, Video Production, Broadcasting, and Financial Publications.



Copyright © 2022 www.investorscene.com - a GloBull Media, LLC Brand