Posted on: Saturday, August 21, 2004
Bearish mood on Hawaiian Airlines
By Deborah Adamson
Advertiser Staff Writer
Many investors are betting that the stock of Hawaiian Airlines' parent has run out of steam after recently hitting its highest price since going public in 1995.
Gregory Yamamoto • The Honolulu Advertiser The stock hit a nine-year high of $7.40 a share on June 30. Shares of the airline, operating under Chapter 11 bankruptcy, had risen steadily after several parties submitted proposals this year to take over the carrier and the parent company named a new CEO.
About 13.7 percent of Hawaiian Holdings' float — shares available for trading to the public — have been shorted at mid-August, according to Bloomberg. That means 1.8 million shares out of a float of 13.1 million shares were sold short.
In a short sale, investors borrow shares from a broker and sell them. The expectation is that when the stock price falls, they can buy shares at a lower price, pay back the broker, and pocket the profit. If the stock rises, investors have to swallow a loss.
A short sale is a bearish signal on a company's stock price.
Investors might not have confidence in a company's prospects or they believe the stock has reached a short-term top, said James Michishima, a certified financial planner in Mililani.
Shares of Hawaiian Holdings fell by 10 cents to close at $5.90 yesterday.
Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.
Hawaiian Holdings is among the top 10 stocks in the American Stock Exchange with short interest of more than 10 percent as a percentage of the float.
Hawaiian Airlines, operating under Chapter 11 bankruptcy, saw its shares hit a nine-year high at the end of June. A significant percentage of its stock has since been sold short.
