The Irish Don't Just Have Luck… They Have Ryanair

The ADR Alert
Monday, December 4, 2006
By Alexander Green, Investment Director

Email – #138

** The Irish Don’t Just Have Luck… They Have Ryanair

After a brief pause early last week, our international stocks took off again.

I moved VimpelCom (NYSE: VIP) to a hold last week, due to its proximity to our sell stop. But then the stock blasted ten points higher in the next three sessions. We’re now up 54% here in just over three months.

The stock is back on our buy list today. Raise your sell stop to $69 here.

Today, I have a new recommendation for you, to Ryanair (Nasdaq: RYAAY).

Based in Ireland, Ryanair is Europe’s largest discount airline, running truly low-cost flights throughout Europe. It flies 437 routes to 24 countries.

Plus, it’s inexpensive travel. For example, a round-trip flight from London to Amsterdam is just $65… a flight from Stockholm to Glasgow is just $54.

These aren’t exceptions. Ryanair is easily the lowest-fare short-haul airline in Europe -and the company expects to tote more than 40 million passengers this fiscal year.

How do they do it? Relentless cost discipline. There are no free meals, for example. Ryanair’s planes don’t even have tray tables.

But the customers aren’t complaining. They’re lining up. The company’s recent earnings were up 24%, on a 27% increase in sales. CEO Michael O’Leary says, “The underlying business is performing very strongly. We are growing like gangbusters.”

In fact, he aims to double Ryanair’s passengers to 80 million within five years. And he’s not just counting on an increase in traffic.

Ryanair has been trying to expand through acquisitions. (Although it looks like its recent bid for Aer Lingus Group PLC will not be successful.) The company has added three new bases this year, including one in Marseilles, France and one in Madrid, Spain just last month. Ryananir is even launching an onboard gambling operation that should be ready on all planes in two years.

With rising sales, increasing market share and strong earnings growth, this stock appears ready for takeoff.

***Action to Take***

Buy Ryanair (Nasdaq: RYAAY) at $78 or better. And place a sell stop at $65 for protection. Speculators may want to take a look at the March 2007 $85 calls (QRX-CQ). But don’t pay more than $1.60.

If you have any questions, feel free to call one of our VIP Trading Services representatives at 888.570.9830 (toll-free) or e-mail: viptrader@oxfordclub.com, or contact Pillar One Advisor Greg Galloway or Rick Pfiefer at 800.438.3040 or 407.667.4729.

Stock
Country
Current Price
Comments

Ryanair (Nasdaq: RYAAY)
Ireland
NEW
Buy at $78 or better. Place sell stop at $65.

Logitech Intern. (Nasdaq: LOGI)
Switzerland
$27.50
Buy. Sell stop is $23.

Rofin-Sinar Tech. (Nasdaq: RSTI)
Germany
$57.07
Buy. Sell stop is $50.

Gerdau S.A. (NYSE: GGB)
Brazil
$15.04
Hold. Sell stop is $14.

Vimpel Comm. (NYSE: VIP)
Russia
$67.84
Buy. Raise sell stop to $69.

Taiwan Semi. (NYSE: TSM)
Taiwan
$10.17
Buy. Sell stop is $9.30.

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