Investor perspectives.
Prior to its bid for Aer Lingus, Ryanair had come in for some criticism for sitting on a €2 billion cash pile,instead of distributing it to investors, blaming uncertainty of demand in the second half of fiscal 2007 for its cautious approach.' However, announcing its excellent first half 2007 results in November 2006, the airline stated it was looking into a number of options for payouts to shareholders by the end of the 2007 calendar year, irrespective of the outcome of the Aer Lingus bid. The options included an annual dividend policy, share buyback and a one-off dividend. It also intended to seek shareholder approval for a 2-for-l stock split, intended to improve the marketability and liquidity of the stock. The shares rose by 3.6 per cent, to €9.28, a record high. The stock had gained 12 per cent during the year. Yet, despite its superior profit erformance, historically, Ryanair was only midrange or below average in its P/E multiple relative to peers like easyjet, whose shares had risen by 46 per cent during the year. However, this offered an upside potential for capital gains, and a low risk of derating, according to Davy, the company's stockbrokers, Davy.