Republic Airlines $RJET will be business as usual not going anywhere but up (Pun Intended)

This is not usually an angle on a trade I would take but the harsh reality is while I am by history a technical short seller I do use fundamental analysis to back up a position to see just how profitable a trade maybe if everything hits. Most of my trades due to the time frame I am in them are on the intraday chart and price action.

To most this means nothing they can't read a chart they don't know how to do a value of assets check they don't even know what the chapters in bankruptcy are. Stop here if you don't know the difference between chapter 11 and chapter 7 and go look that up.

The stock in question is Republic Airlines ticker symbol $RJET; they filed for BANKRUPTCY PROTECTION under CHAPTER 11 and the as I said on twitter the stock is getting raided. The shares value tanked to a low of $0.495 from nearly $3.32 once everyone heard bankruptcy.

Don't get me wrong this was the correct play on the first day you get out as high as you can as an investor and you get in as fast as you can as a shorter but days later as I said let the dust settle you read things over and realize or didn't sell and notice the company is not closing doors they say restructuring
http://www.rjet.com/~/media/Files/CorpComm/FINAL%20-%20Press%20Release%20(3).ashx. KEY POINT: SHARE HOLDER INTERESTS WILL BE LOOKED AFTER

Republican has several issues common with many airlines right now under the new flight laws the pilot hours have increased from 250 hours to 1500 before they can sit in the cockpit as a first officer on a regional airline.

1) Republic airlines is a regional airline see the issue coming as it stands now we have a surplus of planes and routes to cover by contract but not enough pilots to do this.

2)They have contracts for route they can no longer maintain due to the new laws on hours.

3)They have orders for more plane to cover these routes they have contracts for but don't have enough pilots for them.

4)How can they get out of these contract and orders without incurring fines and extra costs to do so?

File CHAPTER 11 for the place under the tax code it rests restructuring this allows company such as airlines the opportunity to keep afloat and especially ones that are still PROFITABLE. Yes this company still turns over a profit.

If you look most airlines that went through this were bought out wholly or partly by the partner they were fling for in a time period of 18 months average. If you want to look at companies that took it in stride Air Canada under protection from April 1st 2003 to September 30th 2004 and before that United Airlines December 9th 2002 emerged February 1st 2006 even Frontier Airlines April 10th to October 1st 2009 and little Mesa Airlines January 5th 2010 to March 11th 2011.

Some say the value of assets and parts are even in the range of $10 a share that is a buy for that alone. For me the reason why this is a better long than short is the lowest price has been stable in the $0.60 cent range with over 400,000 share block buys someone is "raiding" the shares after hours. You can follow the money or you can do your own due diligence and see that you have something special happening here.

In tax law you can sell any share for a loss but you cannot buy the same stock back for 30 days. Smart money dumped and is waiting to buy this back for less than they dumped and use the tax loss against the profit. Yes sell high $2s buy back under a dollar you have doubled you money once everyone starts buying back in this usually takes 6 weeks. So if you aren't out now this maybe the best time to add shares of a lower float company that is on sale.

Know I have orders to buy in as my full disclosure.  As while this won't be a squeeze I expect 30% to 40% returns if I get filled at my price targets short term 200% long term from yesterday's close.

If you can file 4 times and be a front runner for one of the political parties in the United States you can weather this storm and emerge in a better situation than when you went in.

For further reading enjoy..

http://www.politifact.com/truth-o-meter/statements/2015/sep/21/carly-fiorina/trumps-four-bankruptcies/