market folly

York Capital's James Dinan appeared on CNBC today and talked about his latest market views.

He said they own most of the major airlines and notes these companies are now being run like businesses and can make money even at $95 oil.

He specifically mentioned American Airlines (AAL) and thinks there's great optionality here as they've merged with US Air and will have a great management team.  While some of these mergers can be rocky at the start, he thinks the value will be realized.  This has been a big hedge fund trade as of late with the likes of David Tepper and Julian Robertson also being involved in many of these names.

Dinan's biggest position is Hertz (HTZ) and he says it's a consolidation play as they'll see cost savings and revenue synergies from the Dollar Thrifty merger as well as fleet rationalization.  A few quarters ago, our Hedge Fund Wisdom newsletter flagged this popular trade and posted a write-up on Avis Budget (CAR), another beneficiary of the consolidation.

York thinks that this environment is great for event-driven investing, especially due to low interest rates.  Dinan also sees earnings going up next year and thinks companies will continue to do buybacks.  He also said he likes Sprint (S) and T-Mobile (TMUS).


Here are the videos of Dinan's appearance:

Video 1


Video 2


Video 3


Video 4