Growth in passenger traffic
Alaska Air Group’s revenue passenger miles (or RPM) increased by 9.1% to 2,559 million in December 2014, which was driven by an 8.8% rise in revenue passengers. The year-to-date growth in passengers was 6.8%, driving its RPM up by 6.5% to 30,712 million from 28,833 million in the previous year. For an in-depth look at the company, please refer to Alaska Airline Group fundamentally strong, cheap.
Capacity and capacity utilization
Alaska Air Group’s capacity increased by 12.3% year-over-year in December 2014, increasing from 2,836 million to 3,184 million in December 2014. On a year-to-date basis, capacity increased by 7.1% to 36,078 million ASM.
Alaska Air Group (ALK) had the highest year-over-year growth in capacity of 12.3% in December, followed by JetBlue Airways’s (JBLU) 7.2%, Delta Air Lines’s (DAL) 4%, American Airlines’s (AAL) 3.7%, Southwest Airlines’s (LUV) 2.9%, and United Continental Holdings’s (UAL) 2.3%. However, the company’s passenger load factor declined from 87.5% to 85%, despite an increase in traffic. There was a 0.5% decline in year-to-date load factor as well.
Investors can gain exposure to airline stocks by investing in the iShares Transportation Average ETF (IYT) and the SPDR S&P Transportation ETF (XTN). These ETFs hold airline stocks in addition to other types of transportation providers.
For a complete company overview of Alaska Airlines, read Market Realist’s series, An investor’s guide to Alaska Airlines’ operations.