The FBR Ltd (ASX: FBR) share price has been a standout performer on the market today – so much so that it attracted a speeding ticket from the ASX.

FBR, also known as Fastbrick Robotics, designs, develops, builds and operates dynamically stabilised robots to address global needs. Using its proprietary technology, the company is in the process of commercialising products for the construction sector, along with technology-enabled solutions for other industries.

What’s going on?

This morning, FBR was issued a ‘please explain’ from the ASX after shares skyrocketed from yesterday’s closing price of 2.9 cents to an intra-day high of 10.5 cents – a mammoth 262% jump. The ASX also noted a significant increase in the trading volume of FBR shares.

While there was no news out of FBR today, the company made an announcement prior to market open yesterday regarding its flagship Hadrian X construction robot.

In response to the ASX’s price and volume query, FBR stated it is not aware of any information that hasn’t been announced to the market which could explain the recent trading in its shares.

Responding further, FBR said:

“Following FBR’s announcement to the ASX on Wednesday, 3rd June 2020 that it had reached a new top laying rate of 200 blocks per hour with its Hadrian X construction robot, FBR received widespread media coverage on tv news, print and radio. The release of the announcement resulted in an increase in share price of 32% yesterday, and FBR believes that the increased media attention subsequently has contributed to the trading activities today.”

Additionally, FBR drew attention to the government’s HomeBuilder residential construction stimulus package which was announced prior to market open this morning.

In any case, FBR considers yesterday’s announcement as a major milestone in the commercialisation journey of the Hadrian X. It was the first time the company had been able to prove the real commercial case of the Hadrian X in practice.

“When you consider that manual brick and block laying costs globally vary anywhere from $10 per square metre to $100 per square metre, we are already cost competitive across a broad range of the market at 200 blocks per hour,” said CEO Mike Pivac.

At the time of writing, FBR shares are sitting 124.14% higher for the day at 6.5 cents per share. This takes the company’s current market capitalisation to $116 million. For context, the FBR share price closed last week at 2.2 cents with a market cap of around $40 million.

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Motley Fool contributor Cathryn Goh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Alliance Aviation Services Ltd (ASX: AQZ) will fly from Brisbane to Proserpine four times a week. The Queensland state government announced the deal in an effort to revive tourism in the area. There is also the option to increase daily flights if warranted by demand.

QLD Premier, Annastacia Palaszczuk said: “Tourism supports one in three jobs in the Whitsundays. We know how crucial this industry is to the livelihoods of people in this region.”

These flights can be booked from today and will begin on 22 June.

Whitsunday Coast Airport COO, Craig Turner said, “These flights present the opportunity for WCA to develop a partnership with Alliance Airlines through this challenging period and beyond.”

Alliance Airlines, the nation’s workhorse

The move further cements Alliance Airlines as a reliable travel partner. The company’s core offering is fly-in-fly-out services for resource projects across the country. These flights increased during the coronavirus pandemic to maintain social distancing. 

The swift and agile approach from the company allowed them to not only increase flights but to also win new resource clients during the pandemic. On 20 March the company also reported a large increase in charter revenue, driven by both social distancing and the lack of operating alternatives. 

The company is one of the unsung heroes of the COVID-19 period through its support of resource projects. In a recent market update, Alliance provided guidance of a likely $40 million dollar profit.

This is in stark contrast to small airline competitor, Regional Express Holdings Ltd (ASX: REX) who entered the pandemic demanding money from state governments of Western Australia and Queensland. 

Year-to-date performance

With a share price that is up by 8.7% year-to-date, Alliance Airlines has outperformed the aviation sector. It has a price-to-earnings ratio (P/E) that is 4 points higher than its 8-year average. In 2019, Qantas Airways Limited (ASX: QAN) took a 19.9% interest in Alliance, make it the airlines largest shareholder. 

This acquisition is currently under investigation by the ACCC. They have raised issues about purchasing such a large stake in an “important and growing competitor”. I agree fully with this as the airline’s strength has come from its independence and agility.

Foolish takeaway

Alliance Airlines is continuing to win both work and favour across the country, it has been a rock-solid partner for the resources sector throughout the pandemic. I believe its ability to deliver continued service has set up this organisation for sustained incremental performance. 

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Qantas Airways Limited (ASX: QAN) share price has fallen nearly 38% since the start of the year. Unsurprisingly, this is predominantly due to the COVID-19 pandemic and the resulting restrictions on air travel.

However, Qantas shares have soared 117% from their March lows. This performance exceeds the recovery of the S&P/ASX200 index (ASX:XJO) which has rebounded around 35% since its lowest point.

Let’s first look at two reasons the Qantas share price may still offer compelling value at today’s price of $4.42. Then, we’ll consider what Qantas CEO, Alan Joyce, had to say about the company’s outlook. 

Reason 1: strong brand name

According to Airline Ratings, Qantas has been named the safest airline in the world for 2020. I think it’s fair to say that when travelling by plane, passengers value their safety above everything else. A reputation for absolute safety could definitely be seen as a ‘moat’ or competitive advantage for Qantas. As restrictions continue to ease and plane travel resumes, it’s possible passengers will be prepared to pay a premium for safety. This could be good news for the Qantas share price.

In an ASX media release on 5 May, Qantas reported that is Frequent Flyer program has continued to perform well during the pandemic. The program has enabled some revenues to keep flowing from partnerships with companies such as Woolworths Group Ltd (ASX: WOW).

Also, a survey of Qantas Frequent Flyer members showed 85% were planning to fly as soon as conditions returned to normal. This is another positive sign for the Qantas share price.

Reason 2: strong financial position 

Qantas has secured a further $550 million in debt funding to help it survive the coronavirus crisis.  This was facilitated by borrowing against three of its wholly-owned Boeing 787-9 aircraft. Likewise, $1.05 billion was raised in March against seven 787-9 aircraft. Pleasingly, the group has no significant debt maturities until June 2021. 

In addition, Qantas has sufficient liquidity to continue operating under current conditions until at least December 2021.

As of 4 May 2020, Qantas had short-term liquidity of $3.5 billion which includes a $1 billion undrawn facility. The group expects a cash burn rate of $40 million per week by the end of this month.  

Fuel is a significant expense for airlines and the strategy Qantas takes to keep its fuel costs under control is hedging. Essentially, hedging helps minimise the risk and uncertainty created by oil price fluctuations. 

Unfortunately, as demand for travel significantly declined, the group experienced hedging losses due to the drop in oil prices. These losses, together with the impact of foreign exchange, will result in a $145 million cash outflow by the end of September.

Nevertheless, the Aussie airline stated that there will be no risk of further hedging losses. This should assist the company to retain its strong cash position and help boost the chances of continued growth in the Qantas share price. 

CEO comments

On a further positive note, Qantas Group CEO Alan Joyce said in the 5 May media release:

“Our cash balance shows that we’re in a very strong position, which under the circumstances we absolutely have to be. We don’t know how long domestic and international travel restrictions will last or what demand will look like as they’re gradually lifted.

Our ability to withstand this crisis and its aftermath is only possible because we’re tapping into a balance sheet that has taken years to build”.

Foolish takeaway

Qantas has a reputation of being the safest airline in the world as reinforced by its rating for 2020. Furthermore, the company’s financial position is strong considering the current circumstances. As such, I feel the current Qantas share price may present a buying opportunity. Whilst uncertainty still remains surrounding demand once restrictions ease, an indication that 85% of Qantas Frequent Flyer members will fly once they are permitted to is positive in my view.

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Motley Fool contributor Matthew Donald has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Woolworths Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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