Virgin Airlines, Is This A Stock To Buy?

News came through yesterday that Abu Dhabi’s Etihad Airways has more than doubled its stake in Virgin Australia, to a maximum 19.9 percent.

The stronger alliance between the pair is likely to help them compete against Emirates and Qantas, which launched its alliance in March and is viewed as a strong strategic partnership.

Etihad, which originally owned 9 percent, has been buying up Virgin shares on the Australian Stock Exchange in recent weeks and now holds more than 515m.

Nobody known's whether any of those shares were held by Virgin Group CEO Richard Branson, who has previously hinted he would potentially sell his remaining 13 percent stake. This came after he sold 10 percent to Singapore Airlines. This took Singapore's holding to and overall maximum of 19.9 percent.

Air New Zealand also now owns 19.99 percent of the Australian airline, meaning Etihad’s influence in the company had been significantly diluted since it first invested in it in June 2011. At 19.9 per cent, the airline has reached the threshold approved by Australia’s Foreign Investment Review Board in June 2013.

So this begs the question, is Virgin now a good share to buy? I have followed this stock for the last 4 years and there have been several point where I believed it was going to take off.....pardon the pun. However, it has never reached the height's many investors hoped for.

Airlines are notoriously volatile and if you are searching more a more secure Australia share tips then the banks might be for you. Given the significant holdings on Air NZ, Etihad and Singapore which should dry up a large glut of shares there could now be value in VAH, but if you invest watch it link a hawk.