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Airline Stock Performance amid Scandals and Soaring Heat

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Airline scandals

Spring was filled with scandals for many airlines. United Continental (UAL) got caught up in a customer fiasco, and Spirit Airlines (SAVE) had to cancel many flights over its pilot strike, ending up in a serious customer brawl at the Fort Lauderdale-Hollywood International Airport. More recently, American Airlines (AAL) ended up canceling flights at Phoenix due to extreme heat.

As can be expected, the stocks of these three airlines have posted losses in June. American Airlines has fallen 0.78%, Spirit Airlines has fallen 1.6%, and United Continental has fallen 3.0%.

Four carriers have posted gains for the month. JetBlue Airways (JBLU) has risen 0.28%, Southwest Airlines (LUV) has risen 3.3%, Alaska Airlines has risen (ALK) 5.2%, and Delta Air Lines has risen (DAL) 7.9%.

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Year-to-date performance

As of June 22, 2017, Southwest Airlines was the clear winner this year among major carriers, with a gain of 24.5%. United Continental is next in line with an 8.3% gain, followed by Delta Air Lines with a gain of 7.7%. Berkshire Hathaway’s increased investment was a major catalyst for Southwest Airlines. American Airlines has risen 4.4% and Alaska Airlines has risen 3.2%. JetBlue was almost flat, at 0.28%. Spirit Airlines is the only carrier in the red, having fallen almost 9.7%. The broader market, tracked by the SPDR S&P 500 ETF (SPY), has risen ~8.8%. Next, we’ll look at how economic growth impacts airlines.

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