Alaska Air Group Inc
How Did US Airlines Fare in 4Q15?
In this series, we’ll explore the key highlights of the major US airlines’ 4Q15 earnings. In 4Q15, the stocks of most legacy players outpaced those of regional carriers.
A Look at Airline Stocks’ Recent Performance
Stock performance in 2017 Most airline stocks have continued their gaining streak in 2017. As of February 14, 2017, Southwest Airlines (LUV) has seen the highest YTD (year-to-date) gain of 10.9%, followed by Alaska Airlines (ALK) with 8.5%. Allegiant Travels (ALGT) has gained 5.0%, United Continental (UAL) has gained 1.2%, and Delta Air Lines (DAL) […]
Southwest Airlines Increases Third-Quarter Unit Revenue Guidance
Due to increasing crude oil prices, Southwest Airlines (LUV) expects fuel costs to rise more in the third quarter.
Could 2016 Be the Year of Revenue Growth for United Continental?
United Continental (UAL) expects its unit revenue to decline approximately 6%–8% YoY for the upcoming first quarter of 2016. Revenues are expected to remain under pressure in 2016.
Can Delta Air Lines Continue to Reduce Its Debt in 2016?
Delta Air Lines (DAL) expects to generate more than $7 billion–$8 billion of operating cash flow and ~$4 billion–$5 billion of free cash flow. It plans to reduce its adjusted net debt to $4 billion by 2020.
Why Did Analysts Fall Out of Love with Southwest Airlines?
Out of the 18 analysts tracking Southwest Airlines (LUV), 11 analysts (61.1%) have a “buy” recommendation on the stock versus 71% analysts that had a “buy” recommendation on Southwest in 2Q16.
What Helped Alaska Air Group Drive its 2Q15 Earnings?
Adding newer destinations Alaska Air Group (ALK) added a number of new routes in the second quarter of 2015, such as: Boise to Reno Eugene to San Jose, California Los Angeles to Baltimore Los Angeles to Gunnison–Crested Butte Los Angeles to Monterey Los Angeles to San Jose, Costa Rica Portland to Austin Seattle to Charleston […]
Alaska Airlines Capacity Growth Is Faster than That of Its Peers
Alaska Air Group saw the highest surge in traffic demand and was the leader in capacity growth, with a 6.4% YoY increase in its capacity in July 2015.
Why Airlines Got off to a Bad Start in 2016
2016 has been the worst start for the S&P 500 in the past eight years. US airlines also saw a bad start. The Dow Jones U.S. Airline Index has fallen 4% YTD.
Must-know: Alaska’s commitment to increase shareholder returns
Increases in share prices and dividends provide direct benefits to shareholders. The increases in share prices give better returns. Share repurchases and stock splits provide indirect benefits. Share repurchases lead to a reduction in outstanding shares. This results in increased EPS.
More Analysts Have Turned Positive on Alaska Air Group
Alaska Air Group’s (ALK) consensus 12-month target price is $80.55, which indicates a 15.2% return potential on October 10, 2016.
Oil and Airlines: How Are They Mixing?
Airlines have been enjoying huge cash surpluses due to cheaper jet fuel, a situation that has persisted since oil prices experienced a massive slide in mid-2014.
Can Alaska Air Group Continue Its Healthy Revenue Growth in 2016?
For 4Q15, Alaska Air Group’s passenger revenues grew by 4.7% YoY in contrast to the industry’s revenue decline of 1% in 2015. ALK’s total revenue growth stood at 5.5% YoY.
Can Airline Capacity Utilization Improve Going Forward?
Airline capacity utilization is measured using the passenger load factor, which is calculated by dividing traffic numbers by capacity numbers.
Analysts Maintain Bullish Views on Most Airline Stocks
Analysts recommend “buy” for most airline stocks. Goldman Sachs’ (GS) top picks are American Airlines (AAL) and Spirit Airlines (SAVE), and Credit Suisse’s (CS) favorites are Alaska Air Group (ALK) and Southwest Airlines (LUV).
A Look at How JetBlue’s Unit Revenue Changed in August
Since JetBlue Airways’ (JBLU) traffic growth was higher than its capacity growth, its utilizations improved in August 2016.
United sees major improvement in 3Q14 fuel cost efficiency
United achieved significant fuel cost savings during 3Q14 in the form of lower purchase costs and improved fuel efficiency.
Can Alaska Air Group Maintain Its Operational Edge in 2016?
Among its legacy carrier peer group, Alaska Air Group witnessed the most aggressive growth in terms of both traffic and capacity. Airline traffic, as measured by revenue passenger mile, grew by 11.6% YoY in 4Q15.
Airlines Could See Margin Expansion in 2019
In November, the rally in airline stocks was driven by positive remarks on the entire industry from Goldman Sachs (GS) and Credit Suisse (CS).
Will United Continental’s Capacity Continue to Grow in November 2016?
In November 2016, United Continental Holdings’ (UAL) capacity grew by 1.6% YoY (year-over-year). YTD as of November, capacity grew 1.3%.
Must-know: Alaska’s increasing return on invested capital
Alaska’s capital expenditure (or capex) mainly includes investment on aircraft. It increased since 2010. In 2013, ~80% of the total cash used for investing activities was on capital expenditure. The total capital expenditure was $566 million. $487 million was on aircraft and aircraft purchase deposits. $79 million was on flight equipment and other property and equipment.
What Are Analysts’ Recommendations for JetBlue Airways?
According to a Bloomberg consensus, JetBlue Airways is expected to see earnings per share (or EPS) of $0.6 in the quarter, compared to EPS of $0.58 in 3Q15.
Why Most Analysts Still Recommend ‘Buys’ on American Airlines
According to Bloomberg’s consensus, out of the 14 analysts tracking American Airlines (AAL), 71.4% have “buy” recommendations.
Are Analysts Bullish on United Continental ahead of the 3Q16 Earnings?
According to Bloomberg, 12 out of 16 analysts tracking UAL have issued “buy” recommendations. Four analysts have issued “holds.” None has issued a “sell.”
Why United Continental Got Downward Revision of 2016 Revenue
For 2016, analysts are estimating United Continental’s (UAL) revenue to decline by 4% to $36.0 billion. The decline is higher than the earlier estimate of 2%.
Most Airline Stocks Continue to Tumble in August
In 2015, most airline stocks have fallen, and the NYSE ARCA Airline Index (XAL), which is composed of the major US airline stocks, has also tumbled as much as 13.5% year-to-date.
Alaska Air: Why Analysts Forecast Higher Revenue in Next 2 Years
For 2Q16, analysts are estimating 4.2% revenue growth for Alaska Air Group (ALK), which is slower than the 6.2% growth in 1Q16.
Why Delta Air Lines’s July 2016 Metrics Left Investors Wary
US airline stocks tumbled on Tuesday, August 3, following Delta Air Lines’s (DAL) weak operational metrics for July 2016. DAL reported a 7% year-over-year decline in its passenger revenue per available seat mile numbers for July 2016.
Why airlines adopt approaches to improve yield and revenue
Alaska Airlines (ALK) has the lowest yield of $0.148 among all its peers. Its peers include Delta (DAL) at $0.1689, United (UAL) at $0.1614, American (AAL) at $0.1622, and Southwest (LUV) at $0.1602. Revenue management is essential for the airline industry. The industry needs to maximize revenue by selling the most aircraft seats possible to customers at the best price.
Are Analysts Expecting JetBlue Airways’s Revenue to Grow in 2Q16?
Analysts are estimating 2Q16 revenue of ~$1.7 billion for JetBlue Airways (JBLU), which is a year-over-year increase of 2.2%.
Key growth trends in airline passenger traffic by region
Global passenger traffic has increased by 5.8% year-over-year during the first eight months of 2014. Europe (29.7%), Asia-Pacifc (29.2%), and North America (25%) comprise ~85% of global market share by passenger traffic.
Why Have Some Analysts Become Less Positive on American Airlines?
Out of the 14 analysts tracking American Airlines (AAL), 50% have a “buy” recommendation on the stock as compared to the 71.4% that had a “buy” rating in 2Q16.
US Airlines Capacity Growth Outpaces Demand, Load Factor Drops
Decreasing load factors across the airline industry mean that airlines are not able to fill up their seats as fast as they are adding seats. This justifies investor fears of overcapacity.
Must-know: Alaska Airlines’ aircraft and fuel efficiency
In 2013, Alaska operated a fleet of 131 Boeing 737 jet aircraft. It had contracts with Horizon, Sky West Airlines, and Peninsula Airways for regional capacity. Horizon operated 51 Bombardier Q400 turboprop aircraft. It sells all of its capacity to Alaska according to its capacity purchase agreements.
Alaska Air Stock: What Heights Will It Reach in 4Q16?
Alaska Air is expected to announce its 4Q16 financial results on January 26, 2017. What can we expect for 4Q16 and, more importantly, for 2017?
What’s the Demand Outlook for the Airline Industry?
According to IATA (or International Airline Transport Association), for September 2016, global passenger travel demand grew 7% year-over-year (or YoY).
Alaska Air Group Completes Virgin America Merger
On April 4, 2016, Alaska Air Group (ALK) announced its acquisition of Virgin America for $57 per share in cash, which amounted to $2.6 billion.
What Did JetBlue Lose in the Alaska Air-Virgin America Deal?
JetBlue (JBLU) has a strong presence on the East Coast with a major presence in New York, Boston, and the Caribbean. The airline has a much less commanding presence on the West Coast.
What the Direction of October’s Truck Tonnage Index Indicates
In this article, we’ll look at the direction of the Truck Tonnage Index (or TTI) in October 2016.
Is a Rerating of Airlines’ Valuation Multiple Possible?
Currently, American Airlines (AAL), Southwest Airlines (LUV), and Alaska Air Group (ALK) are all trading at ~5x their forward EV-to-EBITDA multiples.
JetBlue Takes Delta Head On with Atlanta Route Expansion
In August, Delta Air Lines (DAL) issued a press release stating its plans to grow in Boston, JetBlue’s (JBLU) second-largest market.
Airline Mergers and Acquisitions: Are We There Yet?
The most recent phase of consolidation that began in 2005 has seen 13 airline mergers and acquisitions. Four of these deals are worth special mention because they changed the face of the industry.
Initial Reactions from the Travel Industry after Trump’s Win
Just a few days ago, we wrote about how Trump had received very little support from the travel industry. Now that he’s been elected, what’s next?
Wall Street Analysts’ Recommendations for American Airlines
According to Reuters, of the 17 analysts tracking American Airlines (AAL), 23.5% (or four) have “strong buy” ratings on the stock.
Why Delta Air Lines Stock Fell after Q4 Earnings
Delta Air Lines (DAL) reported its fourth quarter 2016 results on January 12, 2016. The airline’s revenue fell.
Fewer Analysts Recommend ‘Buys’ on American Airlines
Analysts’ “hold” ratings on American Airlines stock have risen significantly. Nine analysts, a total of 56.3%, now have “hold” ratings on the stock.
How Will the Alaska Air Group-Virgin America Merger Impact Stock?
Virgin America (VA) went public in November 2014. Since then and just before the merger was announced, Virgin America stock gained ~30%.
How Risky Is Alaska Air Group’s Leverage?
Alaska Air Group (ALK) has been reducing its debt for the past five years. For 2016, it reduced its debt from $686.0 million to $626.0 million.
Virgin America Deal Will Impact Alaska’s Financials and Operations
For fiscal 2015, Virgin America’s (VA) revenue grew by 3% to $1,529 million from $1,489 million in 2014. It reported operating margins of 12% and net margins of 22%.
How Did JetBlue Airways Stock Perform This Year?
The JetBlue Airways (JBLU) stock is down ~1.6% since September 14.
Airlines’ Relative Valuation after 3Q17 Earnings: What Is Priced In?
Southwest Airlines (LUV) currently has the highest forward EV-to-EBITDA multiple of 6.9x among its peers.
Frontier Airlines’ IPO: Is the Timing Right?
Airline financials improved drastically in the past three years. Frontier Airlines’ IPO seems to be hitting the market at the right time for its investors.
Southwest Airlines’ Capacity Growth Continued in July
In July 2016, Southwest Airlines’ (LUV) capacity grew by 2.3% YoY, which was slower than in any other month in 2016.
United Continues to See Increases in Its Capacity Growth
For August 2016, United Continental Holdings’ (UAL) capacity rose 1.9% YoY (year-over-year). This is the second-highest rise in 2016.
Why Spirit Airlines’ Stock Has Lost 40% of Its Value in 5 Months
The problems for Spirit Airlines (SAVE) started in early May, when the company ended up canceling hundreds of flights.
Alaska Air’s Low Debt: Is It an Advantage?
Alaska Air Group (ALK) has been trying to reduce its debt burden in order to strengthen its balance sheet in the long term.
Will American Airlines Increase Dividend Payouts?
American Airlines started paying dividends in mid-2014, joining the ranks of Delta Airlines, Southwest Airlines, and Alaska Air Group, the few dividend-paying airlines.
JetBlue Airways: What Are Analysts’ Recommendations?
JetBlue Airways (JBLU) is expected to release its 2Q16 earnings on July 26. According to an analyst consensus, JBLU is expected to earn $0.49 in 2Q16, compared to earnings per share of $0.44 in 2Q15.
Analyzing the Key Variables for the Airline Industry
Investors should keep an eye on airfare trends. Despite a 40% fall in crude oil prices—the major cost for airlines—airfares have remained fairly stable.
How Can the Alaska Air-Virgin America Deal Affect Delta Air Lines?
The merger of Alaska Air and Virgin America is expected to be completed by January 1, 2017. Alaska Air last went through this process in 1982, when it acquired Horizon Air.
Why Are Airline Labor Costs Set to Rise?
When crude oil prices peaked at $100 per barrel, labor costs were an airline’s second largest cost. Thanks to the fall in fuel costs, labor is now the largest expense.
Why Southwest Airlines Stock Fell 9% despite Earnings Beat
Southwest Airlines (LUV) reported its Q3 2018 results before the markets opened on October 25. Its revenues rose 5.1% YoY to $5.6 billion.
What Are Analysts Estimating for Spirit Airlines in 2016?
Of the 15 analysts rating Spirit Airlines’ stock, 80% (12 analysts) have a “buy” rating, 20% (three analysts) have a “hold” rating, and none of the analysts have a “sell” rating.
How the Franklin Growth Fund Allocated Its Portfolio in 2015
Unlike a lot of its peers in this review, FKGRX’s highest exposure is in the industrials sector.
What Can Investors Expect from Delta Air Lines in 2Q15?
For 2Q15, Delta Air Lines expects to increase its revenues by 2% based on 3% growth in capacity and a 2%–4% decline in revenue per available seat.
Why JetBlue Expects Higher Unit Costs in 2Q17
For the first quarter of the year, JetBlue Airways’ (JBLU) operating expenses, excluding fuel and profit sharing, rose 3.3% to 8.35 cents.
Can Alaska Air Group Reduce Its Debt Further in 2016?
Alaska Air Group has set strong cash flow expectations for 2016. The airline expects to generate about $1,375 million in cash flow from operations.
Can Alaska Air Stock Continue Its Stellar Performance in 2016?
Alaska Air Group plans to announce its 4Q15 and 2015 financial results on January 21, 2016. The company had a successful 2014 with record profits of $605 million on revenues of $5.37 billion.
Strong 3Q16 and Warren Buffett: Airlines Are Soaring Higher
Airline stocks have had a great run since 3Q16. In October and November, United Continental (UAL) rose the most at 31.4%, followed by Spirit Airlines (SAVE).
What Are Analysts Estimating for UAL in 2016?
UAL’s consensus 12-month target price is $77.38, which indicates a 65.6% return potential.
Wall Street Recommendations: Alaska, Delta, and United Airlines
Analysts are bullish on the entire airline industry (JETS) and have provided “buy” recommendations on all three of Credit Suisse’s (CS) “outperform”-rated stocks United Continental (UAL), Delta Air Lines (DAL), and Alaska Air Group (ALK).
Could Alaska Air Group’s Margin Expand in 2017?
In 1Q17, Alaska Air Group’s (ALK) EBITDA (earnings before interest, tax, depreciation, and amortization) is expected to fall 5.8% to $385 million.
Delta Air Lines: On the Right Route to Achieve Capacity Guidance?
Delta Air Lines (DAL) has maintained a low-capacity growth profile throughout 2017. For May 2017, DAL’s capacity growth was flat at 22,072 million miles.
JetBlue’s 3Q15 Performance: Must-Know Factors
JetBlue Airlines’ new premium service, which it added to 11 of its flights across high value geographies such as Los Angeles and San Francisco, has received tremendous response.
Why Analysts Reduced 2016 Revenue Estimates for Delta Air Lines
For 1Q16, analysts are estimating Delta Air Lines (DAL) revenues to decline by ~1.5% YoY (year-over-year) to about $9.3 billion.
Declining Crude Oil: A Double-Edged Sword for United Continental
United Continental saw $912 million in 4Q15 savings as its fuel bill fell by 36% compared to a year ago.
Spirit Airlines Warns of Possible Furloughs
Spirit Airlines (NASDAQ:SAVE) is set to report its fiscal 2020 second-quarter results on July 23. Analysts expect losses and a decline in revenue from almost all airlines.
What to Expect from American Airlines’ Q2 Results
American Airlines (NASDAQ:AAL) will likely report its earnings for the second quarter of fiscal 2020 before the market opens on July 23.
Alaska Airlines to Report Q2 Earnings, Cancels Layoffs
Alaska Airlines (NYSE:ALK) will likely report its second-quarter results on July 23 after the market opens. For now, the company will avoid pilot furloughs.
United Airlines’ Q2 Results Paint Bleak Outlook for Airlines
United Airlines reported its second-quarter results on July 21. The quarter hit airlines hard, and they suffered huge losses owing to almost-zero demand.
Will Delta Air Lines’ Losses Be Higher in Q2?
Delta Air Lines (NYSE:DAL) will likely report its financial results for the second quarter of fiscal 2020 on July 14 after the market opens.
Delta Air Lines Reports Wider-than-Expected Losses in Q2
Delta Air Lines’ adjusted revenue, excluding refinery sales, came in at $1.2 billion. The airline saw a capacity reduction of 85%.
Airline Stocks Improved in June amid Easing Lockdowns
Most airline stocks reported gains in June. American Airlines and United Airlines (NYSE:UAL) saw their stocks rise by double-digits at 19.8% and 19.7%.
Goldman Sachs Upgraded Southwest Airlines to ‘Buy’
Southwest Airlines stands out due to its strong balance sheet. A Goldman Sachs analyst is bullish about the stock making a strong recovery.
Delta Air Lines Warns Pilots about Possible Furloughs
Delta Air Lines (NYSE:DAL) has been impacted by the COVID-19 pandemic. The company warned pilots about possible furloughs in the coming months.
JetBlue Airways Announces Growth Plans amid COVID-19 Crisis
On June 18, to support revenue recovery, JetBlue announced that it will add 30 domestic routes, especially in its leisure markets.
What’s United Airlines Doing to Survive the COVID-19 Crisis?
United Airlines (NYSE:UAL) has been suffering amid the COVID-19 pandemic. United’s heavy dependency on international and business travel is a challenge.
Why Does Jim Cramer Favor Southwest Airlines?
Southwest Airlines (NYSE:LUV) has been gearing up to give other airlines though competition. Air travel demand has been picking up again.
Alaska Air Will Cut Jobs to Recover from COVID-19 Losses
Alaska Air (NYSE:ALK) is bearing the brunt of COVID-19 like other airlines. The airline sector got hit the hardest due to travel restrictions amid the pandemic.
United Airlines Will Sell 22 Planes to BOC Aviation amid COVID-19
United Airlines (NYSE:UAL) has fallen 3.7% in pre-market trading as of 7:03 AM ET today. The airline industry has been hit hard by the COVID-19 pandemic.
Airline Stocks Crash, Face Turbulence amid Coronavirus
Airline stocks fell significantly on Thursday. More coronavirus cases led to travel restrictions and a big drop in demand.
United Airlines Stock Gains on Evercore Rating Upgrade
United Airlines (UAL) stock gained nearly 2% on Thursday. Evercore ISI analyst Duane Pfennigwerth upgraded the stock to “outperform” from “in-line.”
Low-entry barriers intensify competition in airline industry
Short-term outlook above expectations The IATA (International Air Transport Association) has revised its forecast upwards on global airline profitability after the free fall of crude oil prices in the second half of 2014. Global net profit for 2014 is now estimated at $19.9 billion, higher than $18 billion projected in June. Profitability is expected to […]
Southwest Extends MAX Grounding, Updates Q4 Outlook
Today, Southwest Airlines (LUV) announced that it is removing all Boeing (BA) 737 MAX flights from its flying schedule through April 13.
Airline Stocks Soar on Strong Job Market Report
Almost every US airline stock soared last Friday after the US Department of Labor reported stronger-than-expected job market data.
United shows significant operating margin, net margin improvement
United Continental’s operating margin increased to 6.1% in 2014 from 3.3% in 2013, and its net margin increased to 2.9% from 1.5%.
United looks to used-aircraft market to control spending
To keep capital expenditures lower, United is exploring the used-aircraft market. It may also extend the useful life of some of its existing aircraft.
Can United investors expect to see continued unit revenue growth?
As seen in the fourth quarter of 2014, the domestic market has slowed down. Domestic unit revenue is expected to remain flat or increase by no more than 2%.
United’s fuel cost savings total $200 million in 2014
United’s fuel cost savings stem from restructuring initiatives and fuel efficiencies. Hedges proved costly to the airline in 2014.
Must-know: Delta’s fleet restructuring and capacity growth plans
Fleet restructuring is an important part of Delta’s cost reduction initiatives. Delta is replacing its 50-seat regional fleet with more efficient CRJ-900 and B-717-200 aircraft.