Southwest Airlines (LUV) reported its operational performance on March 10, 2017. Due to its unit revenue guidance cut, its stock price fell 0.85% on the same day.
JetBlue Airways (JBLU) also reported its February numbers on March 10. Due to its better-than-expected unit revenue performance, JetBlue stock rose 5.1% on the day.
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Delta Air Lines (DAL) and American Airlines (AAL) also posted gains of 1.4% and 1.3%, respectively. Spirit Airlines (SAVE) and Allegiant Travel (ALGT) gained 0.95% and 0.91%, respectively. United Continental (UAL) was the only other major airline to fall that day, posting a 0.28% decline.
Year-to-date on March 10, 2017, Southwest Airlines significantly outperformed its peers. Southwest Airlines stock rose 12.1%, followed by Alaska Air Group (ALK), which gained 8.9%. However, the other airlines’ stocks fell.
JetBlue (JBLU) posted the highest decline—10.6%—during the same period, followed by Spirit Airlines’s fall of 10.1%. Year-to-date, American Airlines (AAL) has fallen 5.9%, Allegiant Travel has fallen 3.6%, Delta Air Lines has fallen 2.6%, and United Continental has fallen 0.74%. A major catalyst for Southwest Airlines was the increased investment by long-time airline bear Warren Buffett.
Because air travel is a discretionary budget item, it makes sense to compare airline industry performance to the consumer discretionary sector. This sector, tracked by the Consumer Discretionary Select Sector SPDR ETF (XLY), rose 6.7% YTD.
The broader market, tracked by the SPDR S&P 500 ETF (SPY), rose 6.3% YTD, indicating that airlines have outperformed the consumer discretionary sector and the broader market YTD.