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7700.0
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2017-01-05 00:00:00 UTC
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Southwest to Begin Nonstop Flights from LaGuardia to Tampa
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AAL
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https://www.nasdaq.com/articles/southwest-to-begin-nonstop-flights-from-laguardia-to-tampa-2017-01-05
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nan
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Per media reports , Southwest Airlines Co.LUV will soon launch nonstop flights operating daily between the Tampa International Airport (TIA) and LaGuardia Airport. The company intends to provide additional choices for passengers travelling to New York with this move. The service is likely to commence from Jun 5, 2017. The sale of tickets is expected to begin on Jan 5, for passengers to plan their summer holidays. The initial fare is projected to be around $89 for one way and around $178 for a round trip, subject to change.
The company estimates to target the large volume of passengers traveling from Tampa to New York, annually. Southwest will operate 737s between the two cities, with a seating capacity of 143 passengers. The first flight will be scheduled at 5.40 a.m., while the second one will leave Tampa's airport daily at 2.35 p.m.
The company has also introduced flights between TIA and Havana, Cuba in Dec 2016. Several other airlines have also commenced flights from American cities to Cuba, including American Airlines Group Inc. AAL . The Tampa airport, at present, is seeing a $1-billion expansion, which is significantly expected to boost capacity and traffic at the airport. This expansion also includes 65 new concessions, which will improve customers' dining and shopping experience. Other airlines offering nonstop flights from TIA to LaGuardia include Delta Air Lines Inc. DAL and Spirit Airlines SAVE .
Zacks Rank
Southwest carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
We note that Southwest's stock has outperformed the broader Zacks categorized Transportation-Airlines industry. The company gained 31.20%, while the industry gained 16.88% over the same period.
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SOUTHWEST AIR (LUV): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
SPIRIT AIRLINES (SAVE): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Several other airlines have also commenced flights from American cities to Cuba, including American Airlines Group Inc. AAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The company intends to provide additional choices for passengers travelling to New York with this move.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Several other airlines have also commenced flights from American cities to Cuba, including American Airlines Group Inc. AAL . Per media reports , Southwest Airlines Co.LUV will soon launch nonstop flights operating daily between the Tampa International Airport (TIA) and LaGuardia Airport.
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Several other airlines have also commenced flights from American cities to Cuba, including American Airlines Group Inc. AAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Per media reports , Southwest Airlines Co.LUV will soon launch nonstop flights operating daily between the Tampa International Airport (TIA) and LaGuardia Airport.
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Several other airlines have also commenced flights from American cities to Cuba, including American Airlines Group Inc. AAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Per media reports , Southwest Airlines Co.LUV will soon launch nonstop flights operating daily between the Tampa International Airport (TIA) and LaGuardia Airport.
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7701.0
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2017-01-05 00:00:00 UTC
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Delta Air Lines, Inc. Joins Its Peers, Raises Unit Revenue Guidance
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AAL
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https://www.nasdaq.com/articles/delta-air-lines-inc-joins-its-peers-raises-unit-revenue-guidance-2017-01-05
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nan
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nan
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After years of steady, industry-leading performance, Delta Air Lines (NYSE: DAL) took some lumps in 2016. The company repeatedly fell short of its goal of returning to unit revenue growth. Moreover, while rivals American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) started to see stronger unit revenue trends late in the year, Delta's revenue trajectory remained subpar.
Delta posted steep unit revenue declines for much of 2016. Image source: Delta Air Lines.
However, in the last two months, Delta's revenue initiatives have finally gained traction. That bodes well for the company's efforts to maintain its margin advantage over American and United in the coming years.
American Airlines and United Continental threaten to take the lead
Throughout the airline industry's recent unit revenue slump, Delta executives told investors that Delta would return to unit revenue growth before either of its legacy carrier rivals. A year ago, that looked like a safe bet. Delta Air Lines' passenger revenue per available seat mile (PRASM) declined just 1.6% year over year in Q4 2015. PRASM declined 6% year over year at both American Airlines and United Continental in the same quarter.
However, Delta's unit revenue took a turn for the worse in 2016. In Q1, PRASM slumped 4.6%. As recently as the month of October, PRASM was down about 6.5% year over year, putting unit revenue on pace to reach the bottom of Delta's Q4 guidance range of down 3% to 5%.
Meanwhile, American Airlines' unit revenue trajectory had already improved dramatically by Q3, with revenue per available seat mile down just 2.2% year over year. Furthermore, following guidance increases in early November and early December, American Airlines currently expects unit revenue to be roughly flat in Q4 (plus or minus 1%).
American Airlines will post better Q4 unit revenue results than its peers. Image source: American Airlines.
United's unit revenue trajectory is also on the upswing. Whereas the carrier initially expected PRASM to fall 4% to 6% year over year in the fourth quarter, it boosted its guidance range last month and now projects that PRASM will decline just 3% to 4%.
Is Delta finally turning the corner?
Both American Airlines and United Continental have noted that business travel demand has started to rebound since November. Delta Air Lines seems to be experiencing the same positive trends. PRASM declined just 1% year over year in November, leading Delta to project last month that its Q4 unit revenue would hit the high end of its guidance range .
Demand for last-minute tickets is finally starting to rebound. Image source: Delta Air Lines.
On Wednesday, Delta revealed that travel demand improved once again in December. As a result, passenger revenue per available seat mile may have declined by as little as 2.5% during the fourth quarter.
Obviously, two months of solid results aren't enough to be confident that Delta Air Lines is out of the woods. That said, the fact that Delta has finally stabilized its unit revenue despite facing relatively tough comparisons from Q4 2015 -- as well as unfavorable holiday timing -- is encouraging.
Unit revenue should recover in 2017
Year-over-year revenue comparisons will be much easier for most of 2017. At the company's investor day last month, Delta president Glen Hauenstein projected that PRASM would be flat in Q1. Based on Delta's improving revenue trajectory, that guidance now seems conservative.
Rising fuel prices and various non-fuel cost headwinds will almost certainly cause Delta's operating margin to decline on a year-over-year basis in 2017. However, a return to unit revenue growth would allow Delta to mitigate the impact of rising costs on its profit margin.
If Delta can maintain a high profit margin even in an environment of rising fuel and labor costs, it would go a long way toward demonstrating the durability of its business model. This in turn could convince investors to award Delta Air Lines stock a higher valuation going forward.
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*Stock Advisor returns as of January 4, 2017
Adam Levine-Weinberg is long January 2017 $40 calls on Delta Air Lines. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Moreover, while rivals American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) started to see stronger unit revenue trends late in the year, Delta's revenue trajectory remained subpar. That said, the fact that Delta has finally stabilized its unit revenue despite facing relatively tough comparisons from Q4 2015 -- as well as unfavorable holiday timing -- is encouraging. Rising fuel prices and various non-fuel cost headwinds will almost certainly cause Delta's operating margin to decline on a year-over-year basis in 2017.
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Moreover, while rivals American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) started to see stronger unit revenue trends late in the year, Delta's revenue trajectory remained subpar. American Airlines and United Continental threaten to take the lead Throughout the airline industry's recent unit revenue slump, Delta executives told investors that Delta would return to unit revenue growth before either of its legacy carrier rivals. Delta Air Lines' passenger revenue per available seat mile (PRASM) declined just 1.6% year over year in Q4 2015.
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Moreover, while rivals American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) started to see stronger unit revenue trends late in the year, Delta's revenue trajectory remained subpar. American Airlines and United Continental threaten to take the lead Throughout the airline industry's recent unit revenue slump, Delta executives told investors that Delta would return to unit revenue growth before either of its legacy carrier rivals. PRASM declined just 1% year over year in November, leading Delta to project last month that its Q4 unit revenue would hit the high end of its guidance range .
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Moreover, while rivals American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) started to see stronger unit revenue trends late in the year, Delta's revenue trajectory remained subpar. Delta Air Lines' passenger revenue per available seat mile (PRASM) declined just 1.6% year over year in Q4 2015. PRASM declined 6% year over year at both American Airlines and United Continental in the same quarter.
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7702.0
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2017-01-04 00:00:00 UTC
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Cowen Downgrades Several Airline Stocks (AAL, ALK, JBLU, SAVE, UAL)
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AAL
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https://www.nasdaq.com/articles/cowen-downgrades-several-airline-stocks-aal-alk-jblu-save-ual-2017-01-04
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nan
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nan
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InvestorPlaceInvestorPlace - Stock Market News, Stock Advice & Trading Tips
Financial services firm Cowen has updated its ratings for several airlines now that 2017 has begun.
Source: amanda kelso via Flickr (Modified)
Research analysts at Cowen have chosen to drop American Airlines Group Inc (NASDAQ: AAL ) from an "Outperform" rating to a "Market Perform" rating. It is still maintaining its target price of $50 per share for AAL.
Alaska Air Group, Inc. (NYSE: ALK ) is another airline company that Cowen has updated its stance on. It also dropped it from an "Outperform" rating to a "Market Perform" rating. However, the firm increased its target price for ALK stock to $95 per share from $92 per share.
JetBlue Airways Corporation (NASDAQ: JBLU ) was also the target of a downgrade from Cowen. Yet again, the firm dropped this stock from an "Outperform" rating to a "Market Perform" rating. Its current target price for JBLU stock sits at $23 per share.
Spirit Airlines Incorporated (NASDAQ: SAVE ) also saw its rating drop from "Outperform" to "Market Perform.' Despite the downgrade, Cowen upped its target price for SAVE stock from $53 per share to $58 per share.
United Continental Holdings Inc (NYSE: UAL ) also suffered a downgrade. The stock now has a "Market Perform" rating instead of its previous "Outperform" rating. UAL stock was also hit with a target price drop from $77 per share to $75 per share, reports Benzinga .
"We believe the airline industry can continue to re-rate higher, but given the sharp move in multiples in 4Q16, the stocks will likely take a breather first," Cowen said in a statement obtained by Barron's .
AAL and ALK stock were up 1%, JBLU and UAL stock were up slightly, and SAVE stock was down slightly as of Wednesday morning.
More From InvestorPlace
The 10 Best Contrarian Stocks to Buy in the New Year
The 10 Best Stocks to Buy for 2017: The Experts' Picks
5 Stocks to Sell in January 2017
The post Cowen Downgrades Several Airline Stocks (AAL, ALK, JBLU, SAVE, UAL) appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Source: amanda kelso via Flickr (Modified) Research analysts at Cowen have chosen to drop American Airlines Group Inc (NASDAQ: AAL ) from an "Outperform" rating to a "Market Perform" rating. It is still maintaining its target price of $50 per share for AAL. AAL and ALK stock were up 1%, JBLU and UAL stock were up slightly, and SAVE stock was down slightly as of Wednesday morning.
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Source: amanda kelso via Flickr (Modified) Research analysts at Cowen have chosen to drop American Airlines Group Inc (NASDAQ: AAL ) from an "Outperform" rating to a "Market Perform" rating. AAL and ALK stock were up 1%, JBLU and UAL stock were up slightly, and SAVE stock was down slightly as of Wednesday morning. More From InvestorPlace The 10 Best Contrarian Stocks to Buy in the New Year The 10 Best Stocks to Buy for 2017: The Experts' Picks 5 Stocks to Sell in January 2017 The post Cowen Downgrades Several Airline Stocks (AAL, ALK, JBLU, SAVE, UAL) appeared first on InvestorPlace .
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AAL and ALK stock were up 1%, JBLU and UAL stock were up slightly, and SAVE stock was down slightly as of Wednesday morning. More From InvestorPlace The 10 Best Contrarian Stocks to Buy in the New Year The 10 Best Stocks to Buy for 2017: The Experts' Picks 5 Stocks to Sell in January 2017 The post Cowen Downgrades Several Airline Stocks (AAL, ALK, JBLU, SAVE, UAL) appeared first on InvestorPlace . Source: amanda kelso via Flickr (Modified) Research analysts at Cowen have chosen to drop American Airlines Group Inc (NASDAQ: AAL ) from an "Outperform" rating to a "Market Perform" rating.
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Source: amanda kelso via Flickr (Modified) Research analysts at Cowen have chosen to drop American Airlines Group Inc (NASDAQ: AAL ) from an "Outperform" rating to a "Market Perform" rating. It is still maintaining its target price of $50 per share for AAL. AAL and ALK stock were up 1%, JBLU and UAL stock were up slightly, and SAVE stock was down slightly as of Wednesday morning.
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7703.0
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2017-01-04 00:00:00 UTC
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Mayday! Analyst Downgrades American Airlines -- and Everybody Else, Too
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AAL
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https://www.nasdaq.com/articles/mayday-analyst-downgrades-american-airlines-and-everybody-else-too-2017-01-04
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nan
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nan
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Complaining that the shares have come too far, too fast, Cowen announced this morning that it is downgrading five airlines -- American Airlines (NASDAQ: AAL) , United Continental (NYSE: UAL) , JetBlue (NASDAQ: JBLU) , Alaska Air (NYSE: ALK) , and Spirit Airlines (NASDAQ: SAVE) -- to market perform.
Now, the good news is that despite downgrading all five stocks, Cowen isn't yet convinced it's necessary to sell any of them. So far, all the downgrades are from outperform to market perform.
Here's a quick rundown of the ratings, and what they mean to investors.
Is the sun setting on airline stocks? Image source: Getty Images.
United Airlines: First to fall?
Cowen takes the dimmest view of United Continental stock. Alone among the five airlines reviewed in this morning's reports, United Continental suffered a cut to its target price -- down from $77 a share to $75, according to data from StreetInsider.com . Granted, with the stock trading for just $73 and change today, the analyst thinks there's some hope for United Continental stock to rise this year, but only about 2.5% -- not enough to justify a buy rating, in the analyst's estimation.
American Airlines
In contrast, despite downgrading American Airlines stock, Cowen left American's price target unchanged at $50. Granted, American Airlines stock costs less than $47 today. This means that, if Cowen is right, there's still room for the stock to grow nearly 7% in 2017. What's more, unlike United Airlines, American pays a small dividend. Between the dividend and the anticipated price appreciation, the stock could return close to 8% in 2017 -- despite the downgrade.
Alaska Air
Cowen actually raised Alaska Air's price target -- up $3 to $95, despite downgrading the stock. With Alaska stock currently costing less than $89, this likewise appears to leave room for 7% growth in share price this year. And when you factor in the stock's 1.2% dividend yield, Alaska Air could also return roughly an 8% profit this year -- according to Cowen.
JetBlue
Cowen left JetBlue's price target unchanged at $23. The stock currently sells for less than this -- about $22.50 -- but that implies only 2% growth in share price this year. And with JetBlue paying no dividend, that 2% is about all investors can hope for.
Back of the pack: Spirit Airlines
But at least that's a better return than Cowen sees for Spirit Airlines stock. Dividend-less and overpriced, up until today, Cowen had thought Spirit Airlines was worth only $53 a share. It costs more than $57 today, though, so to match its new rating of market perform, the analyst grudgingly bumped its price target up $5 to $58. Still, even at the higher target, Cowen sees Spirit stock growing less than 2% this year -- the worst potential profit of the bunch.
Beyond Cowen: What other analysts think
So far, we've talked only about what Cowen thinks about these airline stocks, but Cowen isn't the only analyst with a negative opinion of these companies' prospects -- and with good reason. Over the past five years, profits in the airline industry have compounded strongly, with American and United Airlines in particular growing profits at close to a 60% annualized rate, and even Spirit averaging 10% growth. Going forward, however, the prospects don't look so bright.
With the tailwinds from mergers, decreased capacity/more efficient flying, and falling oil prices all behind them, analysts quoted by S&P Global Market Intelligence see profits falling steadily at both American and United, and Alaska Air as well, over the next five years. Discount carriers are expected to fare better, with Spirit growing profits as much as 8% annually over the next five years, and JetBlue 5%.
Still, with JetBlue's trailing price-to-earnings ratio of 9.9, and Spirit standing at 13.9, both stocks appear richly priced for mere single-digit profits growth -- with no dividend to support them. Long story short: I broadly agree with Cowen that the prospects for airline stocks look significantly less rosy in 2017 than they did in 2016.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of January 4, 2017
Rich Smith has no position in any stocks mentioned. The Motley Fool recommends JetBlue Airways and Spirit Airlines. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Complaining that the shares have come too far, too fast, Cowen announced this morning that it is downgrading five airlines -- American Airlines (NASDAQ: AAL) , United Continental (NYSE: UAL) , JetBlue (NASDAQ: JBLU) , Alaska Air (NYSE: ALK) , and Spirit Airlines (NASDAQ: SAVE) -- to market perform. Alone among the five airlines reviewed in this morning's reports, United Continental suffered a cut to its target price -- down from $77 a share to $75, according to data from StreetInsider.com . Still, even at the higher target, Cowen sees Spirit stock growing less than 2% this year -- the worst potential profit of the bunch.
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Complaining that the shares have come too far, too fast, Cowen announced this morning that it is downgrading five airlines -- American Airlines (NASDAQ: AAL) , United Continental (NYSE: UAL) , JetBlue (NASDAQ: JBLU) , Alaska Air (NYSE: ALK) , and Spirit Airlines (NASDAQ: SAVE) -- to market perform. American Airlines In contrast, despite downgrading American Airlines stock, Cowen left American's price target unchanged at $50. JetBlue Cowen left JetBlue's price target unchanged at $23.
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Complaining that the shares have come too far, too fast, Cowen announced this morning that it is downgrading five airlines -- American Airlines (NASDAQ: AAL) , United Continental (NYSE: UAL) , JetBlue (NASDAQ: JBLU) , Alaska Air (NYSE: ALK) , and Spirit Airlines (NASDAQ: SAVE) -- to market perform. American Airlines In contrast, despite downgrading American Airlines stock, Cowen left American's price target unchanged at $50. Beyond Cowen: What other analysts think So far, we've talked only about what Cowen thinks about these airline stocks, but Cowen isn't the only analyst with a negative opinion of these companies' prospects -- and with good reason.
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Complaining that the shares have come too far, too fast, Cowen announced this morning that it is downgrading five airlines -- American Airlines (NASDAQ: AAL) , United Continental (NYSE: UAL) , JetBlue (NASDAQ: JBLU) , Alaska Air (NYSE: ALK) , and Spirit Airlines (NASDAQ: SAVE) -- to market perform. And with JetBlue paying no dividend, that 2% is about all investors can hope for. Over the past five years, profits in the airline industry have compounded strongly, with American and United Airlines in particular growing profits at close to a 60% annualized rate, and even Spirit averaging 10% growth.
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7704.0
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2017-01-03 00:00:00 UTC
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Commit To Purchase American Airlines Group At $20, Earn 5.2% Using Options
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AAL
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https://www.nasdaq.com/articles/commit-purchase-american-airlines-group-20-earn-52-using-options-2017-01-03
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nan
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nan
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Investors eyeing a purchase of American Airlines Group Inc (Symbol: AAL) stock, but tentative about paying the going market price of $46.69/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the January 2019 put at the $20 strike, which has a bid at the time of this writing of $1.05. Collecting that bid as the premium represents a 5.2% return against the $20 commitment, or a 2.6% annualized rate of return (at Stock Options Channel we call this the YieldBoost ).
Selling a put does not give an investor access to AAL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. And the person on the other side of the contract would only benefit from exercising at the $20 strike if doing so produced a better outcome than selling at the going market price. ( Do options carry counterparty risk? This and six other common options myths debunked ). So unless American Airlines Group Inc sees its shares decline 57.2% and the contract is exercised (resulting in a cost basis of $18.95 per share before broker commissions, subtracting the $1.05 from $20), the only upside to the put seller is from collecting that premium for the 2.6% annualized rate of return.
Worth considering, is that the annualized 2.6% figure actually exceeds the 0.9% annualized dividend paid by American Airlines Group Inc by 1.7%, based on the current share price of $46.69. And yet, if an investor was to buy the stock at the going market price in order to collect the dividend, there is greater downside because the stock would have to lose 57.23% to reach the $20 strike price.
Always important when discussing dividends is the fact that, in general, dividend amounts are not always predictable and tend to follow the ups and downs of profitability at each company. In the case of American Airlines Group Inc, looking at the dividend history chart for AAL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield.
Below is a chart showing the trailing twelve month trading history for American Airlines Group Inc, and highlighting in green where the $20 strike is located relative to that history:
The chart above, and the stock's historical volatility, can be a helpful guide in combination with fundamental analysis to judge whether selling the January 2019 put at the $20 strike for the 2.6% annualized rate of return represents good reward for the risks. We calculate the trailing twelve month volatility for American Airlines Group Inc (considering the last 252 trading day closing values as well as today's price of $46.69) to be 37%. For other put options contract ideas at the various different available expirations, visit the AAL Stock Options page of StockOptionsChannel.com.
In mid-afternoon trading on Tuesday, the put volume among S&P 500 components was 892,344 contracts, with call volume at 892,344, for a put:call ratio of 0.71 so far for the day, which is above normal compared to the long-term median put:call ratio of .65. In other words, if we look at the number of call buyers and then use the long-term median to project the number of put buyers we'd expect to see, we're actually seeing more put buyers than expected out there in options trading so far today. Find out which 15 call and put options traders are talking about today .
Top YieldBoost Puts of the Nasdaq 100 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Investors eyeing a purchase of American Airlines Group Inc (Symbol: AAL) stock, but tentative about paying the going market price of $46.69/share, might benefit from considering selling puts among the alternative strategies at their disposal. Selling a put does not give an investor access to AAL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. In the case of American Airlines Group Inc, looking at the dividend history chart for AAL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield.
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Investors eyeing a purchase of American Airlines Group Inc (Symbol: AAL) stock, but tentative about paying the going market price of $46.69/share, might benefit from considering selling puts among the alternative strategies at their disposal. Selling a put does not give an investor access to AAL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. In the case of American Airlines Group Inc, looking at the dividend history chart for AAL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield.
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Investors eyeing a purchase of American Airlines Group Inc (Symbol: AAL) stock, but tentative about paying the going market price of $46.69/share, might benefit from considering selling puts among the alternative strategies at their disposal. Selling a put does not give an investor access to AAL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. In the case of American Airlines Group Inc, looking at the dividend history chart for AAL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield.
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In the case of American Airlines Group Inc, looking at the dividend history chart for AAL below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 0.9% annualized dividend yield. Investors eyeing a purchase of American Airlines Group Inc (Symbol: AAL) stock, but tentative about paying the going market price of $46.69/share, might benefit from considering selling puts among the alternative strategies at their disposal. Selling a put does not give an investor access to AAL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised.
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7705.0
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2017-01-01 00:00:00 UTC
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One Metric Will Still Give Facebook Enough Growth Steam
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AAL
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https://www.nasdaq.com/articles/one-metric-will-still-give-facebook-enough-growth-steam-2017-01-01
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nan
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nan
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Facebook 's ( FB ) annual revenue has been growing at strong double-digit rates for the last five years. There were several factors that played crucial roles in helping the company more than double its revenue every two years, such as strong user base growth all around the world, the expansion of average revenue per user and increasing mobile advertising revenue.
"As I mentioned last quarter, we continue to expect ad load will play a less significant role driving revenue growth after mid-2017. Over the past two years we have averaged about 50% compound revenue growth in advertising," Wehner said. "Ad load has been one of the three primary factors fueling that growth. With a much smaller contribution from this important factor going forward, we expect to see ad revenue growth rates come down meaningfully."
Facebook's average revenue per user (ARPU) witnessed strong growth over the last several quarters, growing from under $3 in the third quarter 2015 to above $4 during the most recent quarter. ARPU expanded in all regions including Asia Pacific, which increased from $1.39 to $1.89. Most of Facebook's earnings come from advertising, and ARPU will go up if Facebook keeps increasing the cost of advertisements or keeps increasing the number of advertisements it shows every user.
Both of those metrics cannot keep expanding forever, which is what Werner was getting at, and they will have to stabilize sooner than later. This means Facebook has to depend on user base growth to keep its revenue growth rate moving up. But Facebook, despite its user base size in excess of 1.7 billion users around the world, is still growing at double digit rates on this front.
Monthly active user addition, year over year, has actually accelerated during the recent quarters. Most of that growth is coming from Asia Pacific, which saw the company add 107 million users between the third quarter 2015 and 2016, compared to 95 million from Rest of the World (RoW), 27 million from Europe and 12 million from North America.
But, as with the other two metrics, user base cannot keep growing forever. Sooner or later it will start reflecting the growth of internet penetration in emerging markets, as well as the global internet-using population as a whole. For now, however, there's enough room for growth before things start to slow down globally the way we're seeing in North America and Europe now.
Disclosure: I have no positions in the stock mentioned above and no intention to initiate a position in the next 72 hours.
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Warren Buffett Recent Buys
One Metric Will Still Give Facebook Enough Growth Steam
Amazon Fortifies Its Retail Channel With Record Echo Sales
American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares
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This article first appeared on GuruFocus .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Warren Buffett Recent Buys One Metric Will Still Give Facebook Enough Growth Steam Amazon Fortifies Its Retail Channel With Record Echo Sales American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . "As I mentioned last quarter, we continue to expect ad load will play a less significant role driving revenue growth after mid-2017. With a much smaller contribution from this important factor going forward, we expect to see ad revenue growth rates come down meaningfully."
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Warren Buffett Recent Buys One Metric Will Still Give Facebook Enough Growth Steam Amazon Fortifies Its Retail Channel With Record Echo Sales American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . There were several factors that played crucial roles in helping the company more than double its revenue every two years, such as strong user base growth all around the world, the expansion of average revenue per user and increasing mobile advertising revenue. "As I mentioned last quarter, we continue to expect ad load will play a less significant role driving revenue growth after mid-2017.
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Warren Buffett Recent Buys One Metric Will Still Give Facebook Enough Growth Steam Amazon Fortifies Its Retail Channel With Record Echo Sales American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . There were several factors that played crucial roles in helping the company more than double its revenue every two years, such as strong user base growth all around the world, the expansion of average revenue per user and increasing mobile advertising revenue. Facebook's average revenue per user (ARPU) witnessed strong growth over the last several quarters, growing from under $3 in the third quarter 2015 to above $4 during the most recent quarter.
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Warren Buffett Recent Buys One Metric Will Still Give Facebook Enough Growth Steam Amazon Fortifies Its Retail Channel With Record Echo Sales American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . There were several factors that played crucial roles in helping the company more than double its revenue every two years, such as strong user base growth all around the world, the expansion of average revenue per user and increasing mobile advertising revenue. Facebook's average revenue per user (ARPU) witnessed strong growth over the last several quarters, growing from under $3 in the third quarter 2015 to above $4 during the most recent quarter.
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7706.0
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2016-12-30 00:00:00 UTC
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Weekly Top Insider Buys Highlight
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AAL
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https://www.nasdaq.com/articles/weekly-top-insider-buys-highlight-2016-12-30
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The largest insider buys of the week were for Occidental Petroleum Corp. ( OXY ), Tailored Brands Inc. ( TLRD ), Gran Tierra Energy Inc. ( GTE ) and Winnebago Industries Inc. ( WGO ).
Occidental Petroleum director bought 10,000 shares
Director William R. Klesse bought 10,000 shares of Occidental for an average price of $72.15on Dec. 23 . The stock price has decreased by 1.28% since then.
Director Stephen I. Chazen sold 4,000 shares for an average price of $71.81on Dec. 29 . The price of the stock has decreased by 0.81% since then.
Occidental Petroleum Corp. is an American oil and gas exploration and production company. It is based in Houston but has operations all over the world, including the Middle East and South America. In 2015, it was the 16th-largest gas producer and third-largest oil producer in Texas. The company has a market cap of $54.25 billion and traded at $71.23 on Dec. 30.
Occidental announced its third-quarter 2016 results on Nov.1. The company reported a loss of $241 million or 32 cents per diluted share. This amount included one-time net charges of $129 million. Core results reported a loss of $112 million or 15 cents per diluted share.
Tailored Brands director bought 3,980 shares
Director B. Michael Becker bought 3,980 shares of Tailored Brands for an average price of $26.21on Dec. 27 . The stock price has decreased by 2.52% since then.
Becker also sold 4,030 shares for an average price of $26.18on Dec. 27 . The stock price has decreased by 2.41% since then.
Tailored Brands is an American holding company that operates various men's apparel retail stores and owns two corporate apparel brands. Some of the company's products include tuxedo rentals, suit pressings and men's footwear. The company has a market cap of $1.25 billion and traded at $25.55 on Dec. 30.
Tailored Brands announced the appointment of Jack Calandra as executive vice president, chief financial officer and treasurer on Dec. 13 . The appointment is effective Jan. 3, 2017. Calandra has extensive experience in the retail industry, with previous leadership experience in strategic planning, corporate finance and accounting.
Gran Tierra Energy vice president bought 24,000 shares
Vice President David Eldon Hardy bought 9,000 shares of Gran Tierra for an average price of $2.84on Dec. 23 . The stock price has increased by 6.34% since then.
Gran Tierra Energy is a Canadian energy company that focuses on oil and gas exploration and production in South America. The company has a market cap of $1.21 billion and traded at $3.02 on Dec. 30.
Gran Tierra Energy Inc. announced that it has closed the public offering of shares of its common stock on Nov. 29 . The company sold 43.33 million shares of its common stock at a public offering price of $3 per share, totalling approximately $130 million in aggregate gross proceeds.
Winnebago Industries director bought 3,000 shares
Director William C. Fisher bought 1,000 shares of Winnebago for an average price of $31.3on Dec. 29 . The stock price has increased by 1.12% since then.
Fisher also bought 3,000 shares on Dec. 27 for an average price of $33.8. The stock price has decreased by 6.36% since then.
Winnebago Industries is an American manufacturer of motor homes and RVs. In 2014, the company produced a revenue of $945.2 million and an operating income of $63.9 million. The company has a market cap of $996.59 million and traded at $31.65 on Dec. 30.
Winnebago announced on Dec. 14 that its board of directors approved a quarterly cash dividend of 10 cents per share payable on Jan. 25, 2017, to common stockholders of record on Jan. 11, 2017.
For the complete list of stocks bought by company CEOs, go to CEO Buys.
Disclosure: I do not own stock in any of the companies mentioned in the article.
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Warren Buffett Recent Buys
Free 7-day trial of Premium Membership
American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares
Premium Members
This article first appeared on GuruFocus .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Warren Buffett Recent Buys Free 7-day trial of Premium Membership American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . The largest insider buys of the week were for Occidental Petroleum Corp. ( OXY ), Tailored Brands Inc. ( TLRD ), Gran Tierra Energy Inc. ( GTE ) and Winnebago Industries Inc. ( WGO ). Tailored Brands announced the appointment of Jack Calandra as executive vice president, chief financial officer and treasurer on Dec. 13 .
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Warren Buffett Recent Buys Free 7-day trial of Premium Membership American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . Tailored Brands director bought 3,980 shares Director B. Michael Becker bought 3,980 shares of Tailored Brands for an average price of $26.21on Dec. 27 . Gran Tierra Energy vice president bought 24,000 shares Vice President David Eldon Hardy bought 9,000 shares of Gran Tierra for an average price of $2.84on Dec. 23 .
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Warren Buffett Recent Buys Free 7-day trial of Premium Membership American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . Tailored Brands director bought 3,980 shares Director B. Michael Becker bought 3,980 shares of Tailored Brands for an average price of $26.21on Dec. 27 . The company sold 43.33 million shares of its common stock at a public offering price of $3 per share, totalling approximately $130 million in aggregate gross proceeds.
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Warren Buffett Recent Buys Free 7-day trial of Premium Membership American Airlines Group Inc ( AAL ) Chairman and CEO W Douglas Parker Sold $5.5 million of Shares Premium Members This article first appeared on GuruFocus . Occidental Petroleum Corp. is an American oil and gas exploration and production company. Tailored Brands director bought 3,980 shares Director B. Michael Becker bought 3,980 shares of Tailored Brands for an average price of $26.21on Dec. 27 .
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7707.0
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2016-12-28 00:00:00 UTC
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Nasdaq 100 Movers: NVDA, BIDU
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AAL
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https://www.nasdaq.com/articles/nasdaq-100-movers-nvda-bidu-2016-12-28
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In early trading on Wednesday, shares of Baidu ( BIDU ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 0.9%. Year to date, Baidu has lost about 12.1% of its value.
And the worst performing Nasdaq 100 component thus far on the day is NVIDIA ( NVDA ), trading down 3.4%.
Two other components making moves today are American Airlines Group ( AAL ), trading down 1.6%, and NetEase ( NTES ), trading up 0.6% on the day.
VIDEO: Nasdaq 100 Movers: NVDA, BIDU
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 1.6%, and NetEase ( NTES ), trading up 0.6% on the day. In early trading on Wednesday, shares of Baidu ( BIDU ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 0.9%. And the worst performing Nasdaq 100 component thus far on the day is NVIDIA ( NVDA ), trading down 3.4%.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 1.6%, and NetEase ( NTES ), trading up 0.6% on the day. And the worst performing Nasdaq 100 component thus far on the day is NVIDIA ( NVDA ), trading down 3.4%. VIDEO: Nasdaq 100 Movers: NVDA, BIDU The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 1.6%, and NetEase ( NTES ), trading up 0.6% on the day. In early trading on Wednesday, shares of Baidu ( BIDU ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 0.9%. VIDEO: Nasdaq 100 Movers: NVDA, BIDU The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 1.6%, and NetEase ( NTES ), trading up 0.6% on the day. In early trading on Wednesday, shares of Baidu ( BIDU ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 0.9%. Year to date, Baidu has lost about 12.1% of its value.
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7708.0
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2016-12-28 00:00:00 UTC
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Boeing (BA): Delta Air Lines Calls Off 787 Aircraft Order
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AAL
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https://www.nasdaq.com/articles/boeing-ba%3A-delta-air-lines-calls-off-787-aircraft-order-2016-12-28
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The Boeing CompanyBA was dealt a sudden blow when Delta Air Lines, Inc. DAL cancelled a $4.0 billion order for 18 787 Dreamliner jets. Delta Air had inherited the order in 2008 after its merger with Northwest Airlines.
Cancellation is no doubt a setback but the company continues to witness strong demand for its commercial products internationally. Earlier this month, the company inked a high-value deal with Iran Air for 80 jetliners valued at $16.6 billion.
What did Delta Air Have to Say?
According to Greg May, a Delta Air Lines senior vice president of supply chain management and fleet, the order cancellation is in sync with the company's fleet strategy to judiciously deal with its wide-body aircraft requirements. However, he assured that being the one of the world's largest operators of Boeing's aircraft, the company's partnership with the aircraft manufacturer will remain strong in the years to come.
The company also added that it will stick with its order for 120 narrow-body Boeing 737-900 Extended Range aircraft, scheduled to be delivered through 2019.
Reason for the Cancellation
Like many other top U.S. airlines, Delta Air Lines is trying to limit flight capacity growth and in some cases, minimizing air service in order to accommodate falling airfares.
This has led to many U.S. airlines deferring or cancelling orders for wide-body jets - long-distance jets with two aisles. Earlier this year, Delta Air postponed the delivery of four Airbus Group SE EADSY A350s to 2019 and 2020, which would have otherwise been rolled out in 2018. This year also saw American Airlines Group Inc. AAL delay the delivery of 22 A350s by an average of 26 months from the original date in order to cut capital expenses.
Our View
Boeing is the largest aircraft manufacturer in the world in terms of revenue, orders and deliveries, and is one of the largest aerospace contractors. Demand for Boeing's commercial airplanes is on the rise due to a steady improvement in passenger and freight traffic.
Overall, Boeing anticipates the commercial fleet to double over the next two decades to 45,240 airplanes by the end of 2035, backed by sustained 4.8% annual growth in commercial passenger traffic. For that, the world will need 39,620 new planes, worth $5.9 trillion, between 2016 and 2035, per Boeing's current market outlook. This is 4.1% above last year's projected demand of 38,050 jets, worth $5.6 trillion, for the 2015-2034 period.
Boeing expects single-aisle jets to be the major driver behind demand growth, comprising 71% of the total projection. This translates into worldwide demand for 28,140 single-aisle jets, worth $3.0 trillion, in the next 20 years. The new Boeing 737 MAX 8 and the current 737-800 will be the major growth catalysts.
Boeing has been enjoying a steady flow of orders globally. The company won net orders for 470 planes through Dec 20, 2016, including 70 orders for the 787 and 340 for the 737.
Price Movement
Boeing's stock has gained about 9.2% in the last one year, underperforming the Zacks categorized Aerospace/Defense industry's gain of 10.9%. This could be because Boeing continues to face challenges in the form ofuncertainties related to high-cost programs, risks related to key project executions, order cancellations and stiff competition.
Zacks Rank
Boeing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here .
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DELTA AIR LINES (DAL): Free Stock Analysis Report
BOEING CO (BA): Free Stock Analysis Report
AIRBUS GROUP NV (EADSY): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This year also saw American Airlines Group Inc. AAL delay the delivery of 22 A350s by an average of 26 months from the original date in order to cut capital expenses. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report BOEING CO (BA): Free Stock Analysis Report AIRBUS GROUP NV (EADSY): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The Boeing CompanyBA was dealt a sudden blow when Delta Air Lines, Inc. DAL cancelled a $4.0 billion order for 18 787 Dreamliner jets.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report BOEING CO (BA): Free Stock Analysis Report AIRBUS GROUP NV (EADSY): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This year also saw American Airlines Group Inc. AAL delay the delivery of 22 A350s by an average of 26 months from the original date in order to cut capital expenses. The Boeing CompanyBA was dealt a sudden blow when Delta Air Lines, Inc. DAL cancelled a $4.0 billion order for 18 787 Dreamliner jets.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report BOEING CO (BA): Free Stock Analysis Report AIRBUS GROUP NV (EADSY): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This year also saw American Airlines Group Inc. AAL delay the delivery of 22 A350s by an average of 26 months from the original date in order to cut capital expenses. The Boeing CompanyBA was dealt a sudden blow when Delta Air Lines, Inc. DAL cancelled a $4.0 billion order for 18 787 Dreamliner jets.
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This year also saw American Airlines Group Inc. AAL delay the delivery of 22 A350s by an average of 26 months from the original date in order to cut capital expenses. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report BOEING CO (BA): Free Stock Analysis Report AIRBUS GROUP NV (EADSY): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Demand for Boeing's commercial airplanes is on the rise due to a steady improvement in passenger and freight traffic.
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7709.0
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2016-12-27 00:00:00 UTC
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3 Stocks to Watch on Tuesday: American Airlines Group Inc (AAL), Apple Inc (AAPL) and Tesla Motors Inc (TSLA)
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AAL
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https://www.nasdaq.com/articles/3-stocks-to-watch-on-tuesday%3A-american-airlines-group-inc-aal-apple-inc-aapl-and-tesla
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nan
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips
It was a quiet weekend, with most companies celebrating the holiday period by making any announcements they may have before the weekend or later in the week. However, there were a few companies making headlines over the weekend.
These include American Airlines Group Inc (NASDAQ: AAL ), Apple Inc. (NASDAQ: AAPL ) and Tesla Motors Inc (NASDAQ: TSLA ).
American Airlines Group Inc (AAL)
American Airlines experienced some inner strife within the company's workforce.
The company faced some backlash from the union that represents its pilots as line pilots are slated to be offered profit sharing payments amounting to 3% of their 2016 salaries, while its management pilots will rake in 55%.
About 15,000 American Airlines pilots are represented by the union. As far as management pilot goes, the largest payout could amount to about $192,000.
The company responded by noting that there are two types of pilots that are being bunched together by the union, one of which reap the benefits of a profit-sharing plan established in March.
The other is a management-based incentive program that kicks in if the company nets $3.5 billion in the year, but individual performances are also assessed with the plan.
AAL shares are up 15.1% year-to-date.
Apple Inc (AAPL)
Apple is releasing three phones in the near future, the company announced .
The tech giant revealed that it is celebrating the tenth anniversary of its flagship smartphone with the launch of upgraded versions of the iPhone 7 and 7 Plus. These will be the iPhone 7s and the 7s Plus.
The devices will come with upgraded features, including a high-end curved LED display. The internal model numbers of the devices are D20 and D21.
Meanwhile, D22 is the model number of the upcoming iPhone 8, which is the expected name of its next-gen smartphone. The device has more RAM, a better camera and it is codenamed "Ferrari" within the company.
AAPL stock has grown 4% over the last three months.
Tesla Motors Inc (TSLA)
Tesla devices have reached an impressive milestone related to how far its electric car owners have traveled .
Those who travel with one of the alternative energy vehicles have amassed 3.5 billion miles traveled among them. The company reached the 3-billion mark in October, and it added half-a-billion miles in less than three months.
The milestone goes to show just how much the company's leading concept has grown over the years. It only managed to reach the one-billion mark two Junes ago.
Additionally, Tesla has now compiled 1.3 billion miles of data that will help to aid the company's efforts to advance self-driving vehicle technology.
TSLA stock has fallen 8% year-to-date.
More From InvestorPlace
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The post 3 Stocks to Watch on Tuesday: American Airlines Group Inc (AAL), Apple Inc (AAPL) and Tesla Motors Inc (TSLA) appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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These include American Airlines Group Inc (NASDAQ: AAL ), Apple Inc. (NASDAQ: AAPL ) and Tesla Motors Inc (NASDAQ: TSLA ). American Airlines Group Inc (AAL) American Airlines experienced some inner strife within the company's workforce. AAL shares are up 15.1% year-to-date.
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These include American Airlines Group Inc (NASDAQ: AAL ), Apple Inc. (NASDAQ: AAPL ) and Tesla Motors Inc (NASDAQ: TSLA ). American Airlines Group Inc (AAL) American Airlines experienced some inner strife within the company's workforce. More From InvestorPlace The 10 Best Fidelity Funds for 2017 7 Fast-Growing Consumer Stocks to Buy 10 Best Stocks for Retirement Investors The post 3 Stocks to Watch on Tuesday: American Airlines Group Inc (AAL), Apple Inc (AAPL) and Tesla Motors Inc (TSLA) appeared first on InvestorPlace .
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These include American Airlines Group Inc (NASDAQ: AAL ), Apple Inc. (NASDAQ: AAPL ) and Tesla Motors Inc (NASDAQ: TSLA ). More From InvestorPlace The 10 Best Fidelity Funds for 2017 7 Fast-Growing Consumer Stocks to Buy 10 Best Stocks for Retirement Investors The post 3 Stocks to Watch on Tuesday: American Airlines Group Inc (AAL), Apple Inc (AAPL) and Tesla Motors Inc (TSLA) appeared first on InvestorPlace . American Airlines Group Inc (AAL) American Airlines experienced some inner strife within the company's workforce.
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These include American Airlines Group Inc (NASDAQ: AAL ), Apple Inc. (NASDAQ: AAPL ) and Tesla Motors Inc (NASDAQ: TSLA ). More From InvestorPlace The 10 Best Fidelity Funds for 2017 7 Fast-Growing Consumer Stocks to Buy 10 Best Stocks for Retirement Investors The post 3 Stocks to Watch on Tuesday: American Airlines Group Inc (AAL), Apple Inc (AAPL) and Tesla Motors Inc (TSLA) appeared first on InvestorPlace . American Airlines Group Inc (AAL) American Airlines experienced some inner strife within the company's workforce.
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7710.0
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2016-12-27 00:00:00 UTC
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American Airlines: Is it a Great Stock for Value Investors?
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AAL
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https://www.nasdaq.com/articles/american-airlines-it-great-stock-value-investors-2016-12-27
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nan
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Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn't want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let's put American Airlines Group Inc.AAL stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock's current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, American Airlines has a trailing twelve months PE ratio of 6.20. This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 compares in at about 19.84. If we focus on the stock's long-term PE trend, the current level puts American Airlines' current PE ratio above its midpoint of 5.28 over the past two years, with the number having risen rapidly over the past few months.
Further, the stock's PE also compares favorably with the Zacks classified Transportation sector's trailing twelve months PE ratio, which stands at 15.21. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that American Airlines has a forward PE ratio (price relative to this year's earnings) of 8.73, so we might say that the forward earnings estimates indicate that the company's share price will likely appreciate in the near future.
P/S Ratio
Another key metric to note is the Price/Sales ratio. This approach compares a given stock's price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.
Right now, American Airlines has a P/S ratio of about 0.61. This is way lower than the S&P 500 average, which comes in at 2.84 right now. Also, as we can see in the chart below, this stands somewhat below the highs for this stock in particular over the recent past.
If anything, AAL is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading-at least compared to historical norms.
P/CF Ratio
An often overlooked ratio that can still be a great indicator of value is the price/cash flow metric. This ratio doesn't take amortization and depreciation into account, so can give a more accurate picture of the financial health in a business. This is a preferred metric to some valuation investors because cash flows are (a) generally less prone to manipulation by the company's management and (b) are less affected by variation in accounting policies between different companies.
The ratio is generally applied to find out whether a company's stock is overpriced or underpriced with reference to its cash flows generation potential compared with its competitors. However, it is not commonly used for cross-industry comparison, as the average price to cash flow ratio varies from industry to industry.
In this case, American Airlines' P/CF ratio of 3.58 compares favorably with the Zacks classified Transportation-Airline industry average of 5.57, which again indicates that the stock is undervalued in this respect.
Broad Value Outlook
In aggregate, American Airlines currently has a Zacks Value Style Score of 'A', putting it into the top 20% of all stocks we cover from this look. This makes American Airlines a solid choice for value investors. Clearly, AAL is a solid choice on the value front from multiple angles.
What About the Stock Overall?
American Airlines looks to be a good choice for value investors, and there are other favorable factors that this company enjoys, as well. It is worth noting that American Airlines has a Growth grade of 'B' and a Momentum score of 'A'. This gives AAL a Zacks VGM score-or its overarching fundamental grade-of 'A'. (You can read more about the Zacks Style Scores here >> )
However, the company's recent earnings estimates have been mixed at best. The current quarter has seen four estimates go higher in the past sixty days compared to one lower, while the full year estimate has seen five revisions upward and one downward in the same time period.
This has had a clear impact on the consensus estimate, as the current quarter consensus estimate has risen by 11.6% in the past two months, while the full year estimate has climbed just 2.2%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
AMER AIRLINES Price and Consensus
AMER AIRLINES Price and Consensus | AMER AIRLINES Quote
This somewhat mixed trend is why the stock has just a Zacks Rank #3 (Hold) and why we are looking for in-line performance from the company in the near term.
Bottom Line
American Airlines is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. However, with a Zacks Rank #3, it is hard to get too excited about this company overall. In fact, over the past two years, the Zacks Transportation-Airline industry has largely underperformed the broader market, as you can see below:
So, value investors might want to wait for estimates and analyst sentiment to turn around in this name first, but once that happens, this stock could be a compelling pick.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Let's put American Airlines Group Inc.AAL stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks: PE Ratio A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. If anything, AAL is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading-at least compared to historical norms. Clearly, AAL is a solid choice on the value front from multiple angles.
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Let's put American Airlines Group Inc.AAL stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks: PE Ratio A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. If anything, AAL is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading-at least compared to historical norms. Clearly, AAL is a solid choice on the value front from multiple angles.
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Let's put American Airlines Group Inc.AAL stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks: PE Ratio A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. If anything, AAL is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading-at least compared to historical norms. Clearly, AAL is a solid choice on the value front from multiple angles.
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Let's put American Airlines Group Inc.AAL stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks: PE Ratio A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. If anything, AAL is in the lower end of its range in the time period from a P/S metric, suggesting some level of undervalued trading-at least compared to historical norms. Clearly, AAL is a solid choice on the value front from multiple angles.
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7711.0
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2016-12-22 00:00:00 UTC
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The Zacks Analyst Blog Highlights: Alaska Air Group, Delta Air Lines, Southwest Airlines, American Airlines Group and Sabre
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-alaska-air-group-delta-air-lines-southwest-airlines
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nan
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nan
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For Immediate Release
Chicago, IL - December 22, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Alaska Air Group (NYSE: ALK - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), Southwest Airlines (NYSE: LUV - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ) and Sabre Corp. (NASDAQ: SABR - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Wednesday's Analyst Blog:
Airline Stock Roundup: ALK, DAL, LUV
The past week saw the creation of the fifth-largest airline in the U.S. (in terms of passenger traffic) as Alaska Air Group (NYSE: ALK - Free Report ) completed the buyout of Virgin America. The completion of the merger has enabled Alaska Air Group to significantly expand its presence, particularly in the West Coast. The deal also gave the carrier greater access to key cities across the U.S.
Apart from the deal completion, Delta Air Lines (NYSE: DAL - Free Report ) grabbed headlines by virtue of its bullish investor day presentation. We note that the carrier is leaving no stone unturned to expand further in Seattle. Furthermore, Alaska Air and Delta have mutually agreed to end their code-sharing deal from May 1, 2017. Additionally, website issues at Southwest Airlines (NYSE: LUV - Free Report ) and the disappointing reading on November airfares drew attention.
(Read the last Airline Stock Roundup for Dec 14, 2016 ).
Transportation - Airline Industry 5YR % Return
Recap of the Past Week's Most Important Stories
Alaska Air Group expanded significantly by acquiring Virgin America. Following the completion of the acquisition, the merged entity gained access to most of the West Coast hubs (Seattle, Portland, Anchorage, San Francisco and Los Angeles). It will also be serving the maximum number of non-stop destinations from the West Coast. The merged entity will provide 1,200 departure options per day to 118 destinations across the U.S., Mexico, Canada, Costa Rica and Cuba. (Read more: Alaska Air Group Buys Virgin America: What's Ahead? ).
Shares of Delta were positively impacted by the carrier's bullish presentation at its investor day. The carrier issued an improved outlook for passenger revenue per available seat miles (PRASM: a key measure of unit revenue) for the current quarter and expects the metric to decline by approximately 3% (earlier outlook had estimated a decline in the band of 3% to 5%). Delta now expects fourth-quarter operating margin in the band of 10.5% to 11% (earlier outlook had projected the metric in the band of 9.5% to 10.5%) (Read more: Delta Air Lines Up on Bullish Investor Day Update ).
According to data released by the Bureau of Transportation Services, average airfares (adjusted) in the U.S. in November fell 1.3% from the comparable figure in October. The November reading followed the 2.2% month-over-month decline in October. Moreover, airfares decreased 6.6% (unadjusted) in Nov 2016 on a year-over-year basis (Read more: Airfares Continue to Decline: What Awaits Airlines in 2017? ).
According to a Reuters report, American Airlines Group (NASDAQ: AAL - Free Report ) won a favorable verdict in a case against Sabre Corp. (NASDAQ: SABR - Free Report ). The carrier was awarded $5.1 million by the Manhattan federal jury, and the sum is to be automatically increased to $15.3 million under the federal antitrust law, according to the report. The antitrust lawsuit was filed by US Airways in 2011. American Airlines and US Airways merged in 2013, leading to the formation of American Airlines Group. US Airways had accused Sabre Corp. - a leading technology provider to the global travel industry - of charging exorbitant booking fees and harming competition.
Delta and Alaska Air Group have decided mutually to call-off their codesharing partnership fromMay 1, 2017. Dwindling revenues from the pact have been cited as one of the main reasons for ending the deal. With revenues already declining from the pact, Alaska Air expects minimal impact due to the deal termination. In fact, the Seattle, WA-based carrier to forego revenues in the range of $5 million to $10 million in 2017. Although the codesharing deal between the carriers will end, the interline agreement would continue to exist (Read more: Delta, Alaska Air to Terminate Codeshare Tie-up Next Year ). Both Alaska Air and Delta carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Technical glitches are the latest menace for carriers. During the course of the year, some of the biggest airlines have been adversely impacted by technological issues. Dallas-based low-cost carrier Southwest Airlines was the latest victim of disruption in operations due to technological failure.
The timing could not be worse as it comes during the busy holiday period, just a few days prior to Christmas. Apparently , the low-cost carrier's website crashed on Dec 20, creating problems in booking and flight check-in procedures. According to a usatoday report , the carrier is working on resolving the issue. As technological infrastructure constitutes a key expense for airline companies, the profitability of carriers could be affected in the event of such malfunctions.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free .
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Get the full Report on ALK - FREE
Get the full Report on DAL - FREE
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
ALASKA AIR GRP (ALK): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
SOUTHWEST AIR (LUV): Free Stock Analysis Report
SABRE CORP (SABR): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include Alaska Air Group (NYSE: ALK - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), Southwest Airlines (NYSE: LUV - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ) and Sabre Corp. (NASDAQ: SABR - Free Report ). According to a Reuters report, American Airlines Group (NASDAQ: AAL - Free Report ) won a favorable verdict in a case against Sabre Corp. (NASDAQ: SABR - Free Report ). Get the full Report on ALK - FREE Get the full Report on DAL - FREE Get the full Report on LUV - FREE Get the full Report on AAL - FREE Get the full Report on SABR - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include Alaska Air Group (NYSE: ALK - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), Southwest Airlines (NYSE: LUV - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ) and Sabre Corp. (NASDAQ: SABR - Free Report ). Get the full Report on ALK - FREE Get the full Report on DAL - FREE Get the full Report on LUV - FREE Get the full Report on AAL - FREE Get the full Report on SABR - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report SOUTHWEST AIR (LUV): Free Stock Analysis Report SABRE CORP (SABR): Free Stock Analysis Report To read this article on Zacks.com click here.
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Stocks recently featured in the blog include Alaska Air Group (NYSE: ALK - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), Southwest Airlines (NYSE: LUV - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ) and Sabre Corp. (NASDAQ: SABR - Free Report ). Get the full Report on ALK - FREE Get the full Report on DAL - FREE Get the full Report on LUV - FREE Get the full Report on AAL - FREE Get the full Report on SABR - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report SOUTHWEST AIR (LUV): Free Stock Analysis Report SABRE CORP (SABR): Free Stock Analysis Report To read this article on Zacks.com click here.
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Stocks recently featured in the blog include Alaska Air Group (NYSE: ALK - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), Southwest Airlines (NYSE: LUV - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ) and Sabre Corp. (NASDAQ: SABR - Free Report ). According to a Reuters report, American Airlines Group (NASDAQ: AAL - Free Report ) won a favorable verdict in a case against Sabre Corp. (NASDAQ: SABR - Free Report ). Get the full Report on ALK - FREE Get the full Report on DAL - FREE Get the full Report on LUV - FREE Get the full Report on AAL - FREE Get the full Report on SABR - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7712.0
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2016-12-21 00:00:00 UTC
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Notable ETF Inflow Detected - IWS, SRE, MPC, AAL
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AAL
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https://www.nasdaq.com/articles/notable-etf-inflow-detected-iws-sre-mpc-aal-2016-12-21
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nan
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nan
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Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the iShares Russell Mid-Cap Value ETF (Symbol: IWS) where we have detected an approximate $102.6 million dollar inflow -- that's a 1.1% increase week over week in outstanding units (from 111,250,000 to 112,500,000). Among the largest underlying components of IWS, in trading today Sempra Energy (Symbol: SRE) is down about 0.5%, Marathon Petroleum Corp. (Symbol: MPC) is down about 2.4%, and American Airlines Group Inc (Symbol: AAL) is up by about 0.6%. For a complete list of holdings, visit the IWS Holdings page » The chart below shows the one year price performance of IWS, versus its 200 day moving average:
Looking at the chart above, IWS's low point in its 52 week range is $59.69 per share, with $82.86 as the 52 week high point - that compares with a last trade of $82.12. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average » .
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs had notable inflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of IWS, in trading today Sempra Energy (Symbol: SRE) is down about 0.5%, Marathon Petroleum Corp. (Symbol: MPC) is down about 2.4%, and American Airlines Group Inc (Symbol: AAL) is up by about 0.6%. For a complete list of holdings, visit the IWS Holdings page » The chart below shows the one year price performance of IWS, versus its 200 day moving average: Looking at the chart above, IWS's low point in its 52 week range is $59.69 per share, with $82.86 as the 52 week high point - that compares with a last trade of $82.12. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand.
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Among the largest underlying components of IWS, in trading today Sempra Energy (Symbol: SRE) is down about 0.5%, Marathon Petroleum Corp. (Symbol: MPC) is down about 2.4%, and American Airlines Group Inc (Symbol: AAL) is up by about 0.6%. For a complete list of holdings, visit the IWS Holdings page » The chart below shows the one year price performance of IWS, versus its 200 day moving average: Looking at the chart above, IWS's low point in its 52 week range is $59.69 per share, with $82.86 as the 52 week high point - that compares with a last trade of $82.12. Click here to find out which 9 other ETFs had notable inflows » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of IWS, in trading today Sempra Energy (Symbol: SRE) is down about 0.5%, Marathon Petroleum Corp. (Symbol: MPC) is down about 2.4%, and American Airlines Group Inc (Symbol: AAL) is up by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the iShares Russell Mid-Cap Value ETF (Symbol: IWS) where we have detected an approximate $102.6 million dollar inflow -- that's a 1.1% increase week over week in outstanding units (from 111,250,000 to 112,500,000). For a complete list of holdings, visit the IWS Holdings page » The chart below shows the one year price performance of IWS, versus its 200 day moving average: Looking at the chart above, IWS's low point in its 52 week range is $59.69 per share, with $82.86 as the 52 week high point - that compares with a last trade of $82.12.
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Among the largest underlying components of IWS, in trading today Sempra Energy (Symbol: SRE) is down about 0.5%, Marathon Petroleum Corp. (Symbol: MPC) is down about 2.4%, and American Airlines Group Inc (Symbol: AAL) is up by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the iShares Russell Mid-Cap Value ETF (Symbol: IWS) where we have detected an approximate $102.6 million dollar inflow -- that's a 1.1% increase week over week in outstanding units (from 111,250,000 to 112,500,000). For a complete list of holdings, visit the IWS Holdings page » The chart below shows the one year price performance of IWS, versus its 200 day moving average: Looking at the chart above, IWS's low point in its 52 week range is $59.69 per share, with $82.86 as the 52 week high point - that compares with a last trade of $82.12.
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7713.0
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2016-12-21 00:00:00 UTC
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Fly First Class in Delta Air Lines, Inc. (DAL) Stock
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AAL
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https://www.nasdaq.com/articles/fly-first-class-in-delta-air-lines-inc.-dal-stock-2016-12-21
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nan
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nan
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InvestorPlaceInvestorPlace - Stock Market News, Stock Advice & Trading Tips
This year has been turbulent at times, but Delta Air Lines, Inc. (NYSE: DAL ) is now readying for a major liftoff in 2017. For bullish investors though, a protected DAL stock position using Delta options looks like a smarter way to hop on board. Let me explain.
Source: via Delta
As I wrote in back in September, pricing concerns, system outages, terrorism, Brexit and even the risk of rising fuel prices have all been used on one or more occasions during 2016 to keep Delta investors literally gunning for the emergency exits, rather than purchasing DAL stock.
Our DAL stock analysis also happened to be contrarian in its point of view .
At the article's core, investors were urged to ignore the market's bearish narrative on DAL stock and airline peers such as United ContinentalHoldings, Inc. (NYSE: UAL ) and American Airlines Group Inc (NASDAQ: AAL ).
5 Blue-Chip Stock Charts to Watch in 2017
Lo and behold, despite all the bearish overtures and dire forecasts, DAL stock has persevered and clawed its way back to flat on the year, excluding a dividend of 1.61%. For its part, the S&P 500 is up 11% without factoring in its shareholder payout.
The good news in all of this for DAL shareholders is Delta trades at a reasonable multiple compared to the S&P 500. Additionally, with the stock's relative price weakness and corrective action of the past year - DAL stock has put itself in solid technical position to outperform going forward.
DAL Stock Weekly Chart
Click to Enlarge Since our bullish write-up on DAL stock in mid-September, shares have rallied a solid 35%. Notwithstanding the attractive gain, the technical forecast continues to look strong for Delta shareholders.
Looking at the weekly chart of DAL stock we can see shares have essentially gone nowhere for almost two years - or in airline lingo, they have sat on the technical tarmac since January 2015 when shares hit an all-time-high of $51.06.
For bulls though, there's even more to the story. Aside from nearly two years of flat returns and anticipating more normalized and positive price performance for DAL stock, shares have also corrected by a sizable 38% and established a first-stage weekly cup and handle base.
The bullish combination bodes well for Delta shareholders as we enter 2017 as it should lead to an important technical breakout to new all-time-highs.
Delta Stock Collar Strategy
Reviewing Delta stock's options board, the DAL Feb $55/$45 collar delivers stockholders sufficient upside return and protects the position against larger, downside risks.
With shares at $50.75, this collar trades for $50.65 as the sold $55 call's premium is 10 cents more than the price of the purchased $45 put used to protect the DAL stock position.
In entering the collar for $50.65 the trader is in position to achieve a maximum return of 8.57% for the two month holding period if DAL stock rallies to $55. That of course works out to a very nice annualized return.
Nike Stock Soars on Q2 Earnings Beat
What's more, the enviable, but capped profit of the DAL collar can also be adjusted. If shares move higher, the trader roll his or her Delta options up and out. This means riding a longer bullish trend in DAL stock to greater gains is always possible with a collar. Profits for this strategy however, will typically track below an outright long stock position.
Bottom line, with a nice profit profile and the opportunity to adjust if DAL stock begins to really take off coupled with having concrete downside protection in place, makes this DAL collar a smarter way to hop on board Delta as a shareholder.
Investment accounts under Christopher Tyler's management do not currently own positions in any of the securities or their derivatives mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT .
More From InvestorPlace
10 High-Risk, High-Reward Stocks to Buy for 2017
The 12 Best Fidelity 401k Funds to Own
The post Fly First Class in Delta Air Lines, Inc. (DAL) Stock appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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At the article's core, investors were urged to ignore the market's bearish narrative on DAL stock and airline peers such as United ContinentalHoldings, Inc. (NYSE: UAL ) and American Airlines Group Inc (NASDAQ: AAL ). Aside from nearly two years of flat returns and anticipating more normalized and positive price performance for DAL stock, shares have also corrected by a sizable 38% and established a first-stage weekly cup and handle base. With shares at $50.75, this collar trades for $50.65 as the sold $55 call's premium is 10 cents more than the price of the purchased $45 put used to protect the DAL stock position.
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At the article's core, investors were urged to ignore the market's bearish narrative on DAL stock and airline peers such as United ContinentalHoldings, Inc. (NYSE: UAL ) and American Airlines Group Inc (NASDAQ: AAL ). InvestorPlaceInvestorPlace - Stock Market News, Stock Advice & Trading Tips This year has been turbulent at times, but Delta Air Lines, Inc. (NYSE: DAL ) is now readying for a major liftoff in 2017. For bullish investors though, a protected DAL stock position using Delta options looks like a smarter way to hop on board.
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At the article's core, investors were urged to ignore the market's bearish narrative on DAL stock and airline peers such as United ContinentalHoldings, Inc. (NYSE: UAL ) and American Airlines Group Inc (NASDAQ: AAL ). DAL Stock Weekly Chart Click to Enlarge Since our bullish write-up on DAL stock in mid-September, shares have rallied a solid 35%. Delta Stock Collar Strategy Reviewing Delta stock's options board, the DAL Feb $55/$45 collar delivers stockholders sufficient upside return and protects the position against larger, downside risks.
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At the article's core, investors were urged to ignore the market's bearish narrative on DAL stock and airline peers such as United ContinentalHoldings, Inc. (NYSE: UAL ) and American Airlines Group Inc (NASDAQ: AAL ). Looking at the weekly chart of DAL stock we can see shares have essentially gone nowhere for almost two years - or in airline lingo, they have sat on the technical tarmac since January 2015 when shares hit an all-time-high of $51.06. Delta Stock Collar Strategy Reviewing Delta stock's options board, the DAL Feb $55/$45 collar delivers stockholders sufficient upside return and protects the position against larger, downside risks.
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7714.0
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2016-12-20 00:00:00 UTC
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AAL Crosses Above Average Analyst Target
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AAL
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https://www.nasdaq.com/articles/aal-crosses-above-average-analyst-target-2016-12-20
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nan
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nan
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In recent trading, shares of American Airlines Group Inc (Symbol: AAL) have crossed above the average analyst 12-month target price of $47.75, changing hands for $48.58/share. When a stock reaches the target an analyst has set, the analyst logically has two ways to react: downgrade on valuation, or, re-adjust their target price to a higher level. Analyst reaction may also depend on the fundamental business developments that may be responsible for driving the stock price higher - if things are looking up for the company, perhaps it is time for that target price to be raised.
There are 12 different analyst targets contributing to that average for American Airlines Group Inc, but the average is just that - a mathematical average. There are analysts with lower targets than the average, including one looking for a price of $31.00. And then on the other side of the spectrum one analyst has a target as high as $62.00. The standard deviation is $7.735.
But the whole reason to look at the average AAL price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with AAL crossing above that average target price of $47.75/share, investors in AAL have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $47.75 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? Below is a table showing the current thinking of the analysts that cover American Airlines Group Inc:
The average rating presented in the last row of the above table above is from 1 to 5 where 1 is Strong Buy and 5 is Strong Sell. This article used data provided by Zacks Investment Research via Quandl.com . Get the latest Zacks research report on AAL - FREE .
10 ETFs With Most Upside To Analyst Targets »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent trading, shares of American Airlines Group Inc (Symbol: AAL) have crossed above the average analyst 12-month target price of $47.75, changing hands for $48.58/share. But the whole reason to look at the average AAL price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with AAL crossing above that average target price of $47.75/share, investors in AAL have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $47.75 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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In recent trading, shares of American Airlines Group Inc (Symbol: AAL) have crossed above the average analyst 12-month target price of $47.75, changing hands for $48.58/share. But the whole reason to look at the average AAL price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with AAL crossing above that average target price of $47.75/share, investors in AAL have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $47.75 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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And so with AAL crossing above that average target price of $47.75/share, investors in AAL have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $47.75 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table? In recent trading, shares of American Airlines Group Inc (Symbol: AAL) have crossed above the average analyst 12-month target price of $47.75, changing hands for $48.58/share. But the whole reason to look at the average AAL price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes.
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In recent trading, shares of American Airlines Group Inc (Symbol: AAL) have crossed above the average analyst 12-month target price of $47.75, changing hands for $48.58/share. But the whole reason to look at the average AAL price target in the first place is to tap into a "wisdom of crowds" effort, putting together the contributions of all the individual minds who contributed to the ultimate number, as opposed to what just one particular expert believes. And so with AAL crossing above that average target price of $47.75/share, investors in AAL have been given a good signal to spend fresh time assessing the company and deciding for themselves: is $47.75 just one stop on the way to an even higher target, or has the valuation gotten stretched to the point where it is time to think about taking some chips off the table?
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7715.0
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2016-12-20 00:00:00 UTC
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Delta, Alaska Air to Terminate Codeshare Tie-up Next Year
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AAL
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https://www.nasdaq.com/articles/delta-alaska-air-to-terminate-codeshare-tie-up-next-year-2016-12-20
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nan
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nan
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Airline heavyweights Delta Air LinesDAL and Alaska Air Group Inc ALK have decided mutually to call-off their codesharing partnership from May 1, 2017. Dwindling revenues from the pact have been cited as one of the reasons for ending the deal.
With revenues declining from the pact, Alaska Air expects minimal impact due to the termination. In fact, the Seattle, WA based carrier, expects to forego revenues in the range of $5 million to $10 million in 2017. Although the codesharing deal between the carriers will end, the interline agreement would still continue to exist.
The declining significance of the partnership (code sharing + interline) with the Atlanta, GA based Delta to Alaska can be made out from the fact that revenues to the latter from the tie up have come down from $235 million in 2013 to $65 million in 2016. Out of the $65 million, interline agreement has accounted for almost $50 million. No wonder, the interline agreement is still in force, while the agreement pertaining to code sharing will cease to be effective from May 1.
Apart from the declining revenues, Alaska Air's recently completed takeover of Virgin America is also a reason behind the termination as the former aims to focus exclusively to successfully complete the integration process. The completion of the multi-billion-dollar deal, has enabled Alaska Air Group to significantly expand its presence, particularly in the West Coast, gaining greater access to key cities across the U.S. The merged entity will provide 1,200 departure options per day to 118 destinations across the U.S., Mexico, Canada, Costa Rica and Cuba. No wonder Alaska Air is confident of recovering the lost revenues from the code sharing deal.
The intense competition between Delta and Alaska Air regarding Seattle market share has also contributed to the decision to end the code sharing deal. Delta has significantly expanded its Seattle operations over the years (flights being more than tripled at its Seattle-Tacoma International Airport hub since 2013) thereby reducing the need for codeshare agreements there.
With the deal ceasing to be effective from May 1, sales of flights under DL- and AS-coded flight numbers on Alaska Air and Delta planes respectively will stop. Additionally, customers would be unable to earn and redeem Delta miles/ mileage plan miles on flights operated by the other carrier.
With Alaska Air focusing on the Virgin America integration and Delta aiming to expand customer choice at its Seattle-Tacoma International Airport hub, the decision to end the code sharing partnership will be a mutually beneficial one.
Shares of both Alaska Air and Virgin America have been performing well lately, outperforming the Zacks-categorized Transportation-Airline industry over the last three months. While Delta shares have gained 33.99%, those of Alaska Air have appreciated 37.91%. In contrast, the industry has advance only 23.61% in the period.
We note that this is the second time in a matter of few days that Alaska Air has been in the news pertaining to code share. The carrier had to trim the scope of its codesharing agreement with American Airlines Group AAL as a requirement for obtaining antitrust clearance from the U.S. Department of Justice (DOJ). The DOJ approval was necessary for Alaska Air to close its takeover of Virgin America.
Zacks Rank
Both Alaska Air and Delta carry a Zacks Rank # 3 (Hold). A better-ranked stock in the airline space is Hawaiian Holdings HA sporting a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate has increased 10 cents to $1.28 per share for the current quarter at Hawaiian Holdings over the last month . You can see the complete list of today's Zacks #1 Rank stocks here .
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DELTA AIR LINES (DAL): Free Stock Analysis Report
HAWAIIAN HLDGS (HA): Free Stock Analysis Report
ALASKA AIR GRP (ALK): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The carrier had to trim the scope of its codesharing agreement with American Airlines Group AAL as a requirement for obtaining antitrust clearance from the U.S. Department of Justice (DOJ). Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The completion of the multi-billion-dollar deal, has enabled Alaska Air Group to significantly expand its presence, particularly in the West Coast, gaining greater access to key cities across the U.S.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The carrier had to trim the scope of its codesharing agreement with American Airlines Group AAL as a requirement for obtaining antitrust clearance from the U.S. Department of Justice (DOJ). Apart from the declining revenues, Alaska Air's recently completed takeover of Virgin America is also a reason behind the termination as the former aims to focus exclusively to successfully complete the integration process.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The carrier had to trim the scope of its codesharing agreement with American Airlines Group AAL as a requirement for obtaining antitrust clearance from the U.S. Department of Justice (DOJ). The intense competition between Delta and Alaska Air regarding Seattle market share has also contributed to the decision to end the code sharing deal.
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The carrier had to trim the scope of its codesharing agreement with American Airlines Group AAL as a requirement for obtaining antitrust clearance from the U.S. Department of Justice (DOJ). Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. No wonder, the interline agreement is still in force, while the agreement pertaining to code sharing will cease to be effective from May 1.
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7716.0
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2016-12-20 00:00:00 UTC
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IAU, QQXT: Big ETF Outflows
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AAL
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https://www.nasdaq.com/articles/iau-qqxt-big-etf-outflows-2016-12-20
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nan
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nan
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Looking at units outstanding versus one week prior within the universe of ETFs covered at ETF Channel, the biggest outflow was seen in the iShares Gold Trust ( IAU ), where 8,200,000 units were destroyed, or a 1.2% decrease week over week.
And on a percentage change basis, the ETF with the biggest outflow was the First Trust NASDAQ-100 Ex-Technology Sector Index Fund ( QQXT ), which lost 1,450,000 of its units, representing a 35.8% decline in outstanding units compared to the week prior. Among the largest underlying components of QQXT, in morning trading today American Airlines Group ( AAL ) is up about 1.4%, and CSX Corporation ( CSX ) is higher by about 1%.
VIDEO: IAU, QQXT: Big ETF Outflows
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of QQXT, in morning trading today American Airlines Group ( AAL ) is up about 1.4%, and CSX Corporation ( CSX ) is higher by about 1%. And on a percentage change basis, the ETF with the biggest outflow was the First Trust NASDAQ-100 Ex-Technology Sector Index Fund ( QQXT ), which lost 1,450,000 of its units, representing a 35.8% decline in outstanding units compared to the week prior. VIDEO: IAU, QQXT: Big ETF Outflows The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of QQXT, in morning trading today American Airlines Group ( AAL ) is up about 1.4%, and CSX Corporation ( CSX ) is higher by about 1%. Looking at units outstanding versus one week prior within the universe of ETFs covered at ETF Channel, the biggest outflow was seen in the iShares Gold Trust ( IAU ), where 8,200,000 units were destroyed, or a 1.2% decrease week over week. VIDEO: IAU, QQXT: Big ETF Outflows The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of QQXT, in morning trading today American Airlines Group ( AAL ) is up about 1.4%, and CSX Corporation ( CSX ) is higher by about 1%. Looking at units outstanding versus one week prior within the universe of ETFs covered at ETF Channel, the biggest outflow was seen in the iShares Gold Trust ( IAU ), where 8,200,000 units were destroyed, or a 1.2% decrease week over week. And on a percentage change basis, the ETF with the biggest outflow was the First Trust NASDAQ-100 Ex-Technology Sector Index Fund ( QQXT ), which lost 1,450,000 of its units, representing a 35.8% decline in outstanding units compared to the week prior.
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Among the largest underlying components of QQXT, in morning trading today American Airlines Group ( AAL ) is up about 1.4%, and CSX Corporation ( CSX ) is higher by about 1%. Looking at units outstanding versus one week prior within the universe of ETFs covered at ETF Channel, the biggest outflow was seen in the iShares Gold Trust ( IAU ), where 8,200,000 units were destroyed, or a 1.2% decrease week over week. And on a percentage change basis, the ETF with the biggest outflow was the First Trust NASDAQ-100 Ex-Technology Sector Index Fund ( QQXT ), which lost 1,450,000 of its units, representing a 35.8% decline in outstanding units compared to the week prior.
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7717.0
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2016-12-16 00:00:00 UTC
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Delta Air Lines (DAL) Up on Bullish Investor Day Update
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AAL
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https://www.nasdaq.com/articles/delta-air-lines-dal-up-on-bullish-investor-day-update-2016-12-16
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nan
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nan
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Shares of Delta Air LinesDAL have been on an uptrend in recent times. The stock has comfortably outpaced the Zacks categorized Transportation-Airline industry over the last three months. The stock gained almost 34.42% compared with the industry, which advanced just 22% over the same period.
Continuing its trend of bullish performance, the Atlanta, GA-based airline behemoth presented a rosy picture at its Investor Day. The stock gained 1.36% on Dec 15, to close the trading session at $50.50 after the update. The carrier sounded bullish about its ability to reach long-term targets. Delta expects to perform well in 2017 ("a transition year") driven by the uptick in business travel demand after the presidential election.
The carrier issued an improved outlook for passenger revenue per available seat miles (PRASM: a key measure of unit revenue) for the current quarter and expects the metric to decline by approximately 3% (earlier outlook had called for a decline in the band of 3% to 5%). Delta now expects fourth-quarter operating margin in the band of 10.5% to 11% (earlier outlook had projected the metric in the band of 9.5% to 10.5%).
The improving trends with respect to unit revenues are very encouraging. Delta, which carries a Zacks Rank # 3 (Hold), had initially expected return to positive unit revenue growth by mid-2016 but its plans were subsequently postponed by about six months. Multiple factors like unfavorable foreign currency movements pressurized yield.
Delta expects PRASM to be flat in the first quarter of 2017 on the back of the improving trends in many regions, particularly Latin America. The carrier expects non-fuel unit costs to increase in the range of 2-3% in 2017. We note that labor costs are surging not only at Delta but also at its peers like American Airlines Group AAL , JetBlue JBLU and United Continental Holdings UAL due to recent labor deals.
Consolidated capacity is projected to expand by 1% in 2017. Domestic capacity is projected to expand 2% and the same on the international front is projected to decline 1%. With oil prices rising, Delta foresees fuel prices to increase year-over-year for the first time since 2014.
Delta, which is constantly working toward reducing its debt (net) levels, also stated that it remains focused on rewarding shareholders through dividends and buybacks. The carrier expects to complete the $5 billion buyback program by mid 2017. Moreover, it intends to return at least 70% of free cash flow to its investors over the next two years.
You can see the complete list of today's Zacks #1 Rank stocks here .
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JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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We note that labor costs are surging not only at Delta but also at its peers like American Airlines Group AAL , JetBlue JBLU and United Continental Holdings UAL due to recent labor deals. Click to get this free report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Continuing its trend of bullish performance, the Atlanta, GA-based airline behemoth presented a rosy picture at its Investor Day.
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We note that labor costs are surging not only at Delta but also at its peers like American Airlines Group AAL , JetBlue JBLU and United Continental Holdings UAL due to recent labor deals. Click to get this free report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Click to get this free report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. We note that labor costs are surging not only at Delta but also at its peers like American Airlines Group AAL , JetBlue JBLU and United Continental Holdings UAL due to recent labor deals. The carrier issued an improved outlook for passenger revenue per available seat miles (PRASM: a key measure of unit revenue) for the current quarter and expects the metric to decline by approximately 3% (earlier outlook had called for a decline in the band of 3% to 5%).
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We note that labor costs are surging not only at Delta but also at its peers like American Airlines Group AAL , JetBlue JBLU and United Continental Holdings UAL due to recent labor deals. Click to get this free report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The carrier issued an improved outlook for passenger revenue per available seat miles (PRASM: a key measure of unit revenue) for the current quarter and expects the metric to decline by approximately 3% (earlier outlook had called for a decline in the band of 3% to 5%).
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7718.0
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2016-12-16 00:00:00 UTC
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E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight
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AAL
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https://www.nasdaq.com/articles/e-cigarette-battery-sparks-fire-american-airlines-group-inc-aal-flight-2016-12-16
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nan
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nan
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips
An e-cigarette caught fire and caused an American Airlines Group Inc (NASDAQ: AAL ) plane to make an emergency landing on Thursday.
The Federal Aviation Administration (FAA) is investigating the matter to learn why the e-cigarette caught fire. The items aren't allowed in checked luggage. However, they can be brought onto a plane via a carry-on bag.
Inspectors have already looked at the American Airlines Group Inc plane that the fire started in. There is no damage to the aircraft . All passengers and crew on the flight were unharmed. Passengers were taken from the plane and moved to a new one to finish their flight.
The flight with the malfunctioning e-cigarette was originally making its way to Indianapolis when the fire broke out. The emergency landing was made at the Clinton National Airport located in Little Rock, Ark., reports ABC News .
The fire in the American Airlines Group Inc flight started in the plane's bathroom. It happened after one of the passengers took their e-cigarette into the bathroom to use it. The fire was quickly put out by flight attendants. According to FFA rules, passengers aren't allowed to charge or use e-cigarette during flights.
"There was just a lot of panic in the plane and we just really quickly realized that we were going to do a quick descent," Cindy Nelson, one of the passengers on the flight, told WRTV Indianapolis . "We still didn't know what was going on and so we made the fastest descent I have ever experienced."
More From InvestorPlace
The 10 Biggest Stock Market Successes of 2016
5 Blue-Chip Stocks to Sell for December
The 10 Best Healthcare Stocks to Buy for 2017
The post E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips An e-cigarette caught fire and caused an American Airlines Group Inc (NASDAQ: AAL ) plane to make an emergency landing on Thursday. More From InvestorPlace The 10 Biggest Stock Market Successes of 2016 5 Blue-Chip Stocks to Sell for December The 10 Best Healthcare Stocks to Buy for 2017 The post E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight appeared first on InvestorPlace . The Federal Aviation Administration (FAA) is investigating the matter to learn why the e-cigarette caught fire.
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips An e-cigarette caught fire and caused an American Airlines Group Inc (NASDAQ: AAL ) plane to make an emergency landing on Thursday. More From InvestorPlace The 10 Biggest Stock Market Successes of 2016 5 Blue-Chip Stocks to Sell for December The 10 Best Healthcare Stocks to Buy for 2017 The post E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight appeared first on InvestorPlace . The fire in the American Airlines Group Inc flight started in the plane's bathroom.
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips An e-cigarette caught fire and caused an American Airlines Group Inc (NASDAQ: AAL ) plane to make an emergency landing on Thursday. More From InvestorPlace The 10 Biggest Stock Market Successes of 2016 5 Blue-Chip Stocks to Sell for December The 10 Best Healthcare Stocks to Buy for 2017 The post E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight appeared first on InvestorPlace . The fire in the American Airlines Group Inc flight started in the plane's bathroom.
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InvestorPlace InvestorPlace - Stock Market News, Stock Advice & Trading Tips An e-cigarette caught fire and caused an American Airlines Group Inc (NASDAQ: AAL ) plane to make an emergency landing on Thursday. More From InvestorPlace The 10 Biggest Stock Market Successes of 2016 5 Blue-Chip Stocks to Sell for December The 10 Best Healthcare Stocks to Buy for 2017 The post E-Cigarette Battery Sparks Fire on American Airlines Group Inc (AAL) Flight appeared first on InvestorPlace . According to FFA rules, passengers aren't allowed to charge or use e-cigarette during flights.
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7719.0
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2016-12-15 00:00:00 UTC
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IBM Corp's MobileFirst for iOS Continues to Win Customers
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AAL
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https://www.nasdaq.com/articles/ibm-corps-mobilefirst-for-ios-continues-to-win-customers-2016-12-15
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nan
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nan
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International Business Machines Corp 's IBM MobileFirst for iOS and cloud-based solutions continues to win airline customers. Recently, IBM collaborated with Japan Airlines (JAL) to jointly develop an improved aircraft maintenance solution based on its MobileFirst for iOS platform.
By using IBM MobileFirst on Apple's AAPL iPad Pro and iPhone aircraft engineers can easily access tools and processes that speed up aircraft maintenance process. The solution will aid JAL aircraft engineers to focus on higher-level issues by saving more time on routine maintenance checks. The app eliminates the need of manual-based processes and saves time on preparing and reporting technical issues.
Recently, Finland's largest airline Finnair entered into an agreement with the company to use Mobile at Scale for iOS, which allows clients to deploy multiple iOS apps over a multi-year period. The airline will rollout the first application for aircraft line maintenance in early 2017.
Meanwhile, IBM's cloud platform was selected by the American Airlines Group AAL to enhance its enterprise scalability, flexibility and reliability. (Read More: IBM's Cloud Platform Selected by American Airlines Group )
Notably, in Oct 2015, IBM had won a ten-year technology services agreement worth approximately $700 million from Etihad Airways. The agreement included plans for the creation of a new cloud data centre in Abu Dhabi.
INTL BUS MACH Price and Consensus
INTL BUS MACH Price and Consensus | INTL BUS MACH Quote
Cloud & Acquisitions Key Catalyst for IBM
IBM's strategic imperatives (cloud, analytics, mobility and security) are its long-term growth drivers. In the latest quarter, revenues from strategic imperatives increased 16% on a year-over-year basis to $8.3 billion. Notably, cloud revenues jumped 44%.
We note that IBM continues to expand its cloud footprint by announcing new cloud centers in South Korea, Norway and UK. The company now has more than 50 cloud centers globally. Further, IBM's partnership with Workday and VMware VMW is expected to drive cloud adoption going ahead.
Moreover, aggressive acquisitions boost IBM's growth prospects and competitive position. Recent addition of Sanovi Technologies and Promontory Financial Group into the company's business will strengthen footprint in different industries like continuity & hybrid cloud recovery and risk management & regulatory compliance.
Notably, IBM has underperformed the broader Zacks Computer Integrated Systems industry on a year-to-date basis. While the industry generated a return of 31%, the stock returned 22.5%. However, strong growth from strategic initiatives and acquisitions will aid the stock to rebound in the quarters ahead.
Zacks Rank & Key Pick
Currently, IBM carries a Zacks Rank #3 (Hold). VMware with Zacks Rank #2 (Buy) is a better-ranked stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
INTL BUS MACH (IBM): Free Stock Analysis Report
APPLE INC (AAPL): Free Stock Analysis Report
VMWARE INC-A (VMW): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Meanwhile, IBM's cloud platform was selected by the American Airlines Group AAL to enhance its enterprise scalability, flexibility and reliability. Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report VMWARE INC-A (VMW): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. International Business Machines Corp 's IBM MobileFirst for iOS and cloud-based solutions continues to win airline customers.
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Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report VMWARE INC-A (VMW): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Meanwhile, IBM's cloud platform was selected by the American Airlines Group AAL to enhance its enterprise scalability, flexibility and reliability. (Read More: IBM's Cloud Platform Selected by American Airlines Group ) Notably, in Oct 2015, IBM had won a ten-year technology services agreement worth approximately $700 million from Etihad Airways.
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Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report VMWARE INC-A (VMW): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Meanwhile, IBM's cloud platform was selected by the American Airlines Group AAL to enhance its enterprise scalability, flexibility and reliability. (Read More: IBM's Cloud Platform Selected by American Airlines Group ) Notably, in Oct 2015, IBM had won a ten-year technology services agreement worth approximately $700 million from Etihad Airways.
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Meanwhile, IBM's cloud platform was selected by the American Airlines Group AAL to enhance its enterprise scalability, flexibility and reliability. Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report VMWARE INC-A (VMW): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Recently, IBM collaborated with Japan Airlines (JAL) to jointly develop an improved aircraft maintenance solution based on its MobileFirst for iOS platform.
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7720.0
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2016-12-15 00:00:00 UTC
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Is American Airlines Group (AAL) Stock a Solid Choice Right Now?
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AAL
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https://www.nasdaq.com/articles/is-american-airlines-group-aal-stock-a-solid-choice-right-now-2016-12-15
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nan
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nan
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One stock that might be an intriguing choice for investors right now is American Airlines Group Inc.AAL . This is because this security in the Transportation - Airline space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
This is important because, often times, a rising tide will lift all boats in an industry, as there can be broad trends taking place in a segment that are boosting securities across the board. This is arguably taking place in the Transportation - Airline space as it currently has a Zacks Industry Rank of 56 out of more than 250 industries, suggesting it is well-positioned from this perspective, especially when compared to other segments out there.
Meanwhile, American Airlines Group is actually looking pretty good on its own too. The firm has seen solid earnings estimate revision activity over the past month, suggesting analysts are becoming a bit more bullish on the firm's prospects in both the short and long term.
AMER AIRLINES Price and Consensus
AMER AIRLINES Price and Consensus | AMER AIRLINES Quote
In fact, over the past month, current quarter estimates have risen from 67 cents per share to 58 cents per share, while current year estimates have risen from $5.44 per share to $5.53 per share. The company currently carries a Zacks Rank #3 (Hold), which is also a favorable signal. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
So, if you are looking for a decent pick in a strong industry, consider American Airlines Group. Not only is its industry currently in the top third, but it is seeing solid estimate revisions as of late, suggesting it could be a very interesting choice for investors seeking a name in this great industry segment.
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AMER AIRLINES (AAL): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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One stock that might be an intriguing choice for investors right now is American Airlines Group Inc.AAL . Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This is because this security in the Transportation - Airline space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
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One stock that might be an intriguing choice for investors right now is American Airlines Group Inc.AAL . Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This is because this security in the Transportation - Airline space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
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One stock that might be an intriguing choice for investors right now is American Airlines Group Inc.AAL . Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This is arguably taking place in the Transportation - Airline space as it currently has a Zacks Industry Rank of 56 out of more than 250 industries, suggesting it is well-positioned from this perspective, especially when compared to other segments out there.
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One stock that might be an intriguing choice for investors right now is American Airlines Group Inc.AAL . Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. This is because this security in the Transportation - Airline space is seeing solid earnings estimate revision activity, and is in great company from a Zacks Industry Rank perspective.
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7721.0
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2016-12-15 00:00:00 UTC
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Consumer Sector Update for 12/15/2016: SKYW,AAL,BBD-B.TO,PIR,RLH
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AAL
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https://www.nasdaq.com/articles/consumer-sector-update-12152016-skywaalbbd-btopirrlh-2016-12-15
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Top Consumer Stocks
WMT +0.06%
MCD -0.09%
DIS +1.12%
CVS -1.41%
KO +0.85%
Consumer stocks were slightly higher this afternoon, with shares of consumer staples companies in the S&P 500 adding about 0.4% in value today while shares of consumer discretionary firms in the S&P 500 were climbing about 0.2%.
In company news, Skywest ( SKYW ) shares climbed to a new all-time high on Thursday after analysts at Cowen today increased their price target for the discount airline by $6 to $40 a share, also reiterating their outperform overall rating for the stock.
The move follows Skywest earlier today saying it was cancelling an order for 76 CRJ200 passenger jets from Bombardier (BBD-B.TO) as part of its ongoing fleet transition slated for completion in 2017. Bombardier has agreed to pay a $90 million termination fee by next month, Skywest said, adding it has placed 12 of its dual-class CRJ200 aircraft with American Airlines ( AAL ) through a multiple-year contract by its ExpressJet leasing unit.
SKYW shares were up more than 7% today at $39.25 apiece, retracing much of a prior advance to a best-ever $39.30 earlier today. AAL shares also were higher today, increasing almost 3% to $49.19 each following a 4.2% rise this morning to $49.95 a share.
In other sector news,
(+) PIR, (+37.2%) Adjusted Q3 EPS of $0.22 beats by $0.09. Net sales fall 0.4% to $475.9 mln, topping consensus by $9.1 mln. Raises Q4 results above Street views. Names Terry London CEO. Johnson Rice upgrade to Accumulate. Wedbush doubles price target to $8 while Telsey Advisory Group bumps price target by $1.50 to $7 a share.
(-) RLH, (-12.1%) Prices $16.9 mln public offering of 2.25 mln shares at $8 each, a 12.1% discount to Wednesday's closing price.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Bombardier has agreed to pay a $90 million termination fee by next month, Skywest said, adding it has placed 12 of its dual-class CRJ200 aircraft with American Airlines ( AAL ) through a multiple-year contract by its ExpressJet leasing unit. AAL shares also were higher today, increasing almost 3% to $49.19 each following a 4.2% rise this morning to $49.95 a share. In company news, Skywest ( SKYW ) shares climbed to a new all-time high on Thursday after analysts at Cowen today increased their price target for the discount airline by $6 to $40 a share, also reiterating their outperform overall rating for the stock.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Bombardier has agreed to pay a $90 million termination fee by next month, Skywest said, adding it has placed 12 of its dual-class CRJ200 aircraft with American Airlines ( AAL ) through a multiple-year contract by its ExpressJet leasing unit. AAL shares also were higher today, increasing almost 3% to $49.19 each following a 4.2% rise this morning to $49.95 a share.
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Bombardier has agreed to pay a $90 million termination fee by next month, Skywest said, adding it has placed 12 of its dual-class CRJ200 aircraft with American Airlines ( AAL ) through a multiple-year contract by its ExpressJet leasing unit. AAL shares also were higher today, increasing almost 3% to $49.19 each following a 4.2% rise this morning to $49.95 a share. Consumer stocks were slightly higher this afternoon, with shares of consumer staples companies in the S&P 500 adding about 0.4% in value today while shares of consumer discretionary firms in the S&P 500 were climbing about 0.2%.
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Bombardier has agreed to pay a $90 million termination fee by next month, Skywest said, adding it has placed 12 of its dual-class CRJ200 aircraft with American Airlines ( AAL ) through a multiple-year contract by its ExpressJet leasing unit. AAL shares also were higher today, increasing almost 3% to $49.19 each following a 4.2% rise this morning to $49.95 a share. In company news, Skywest ( SKYW ) shares climbed to a new all-time high on Thursday after analysts at Cowen today increased their price target for the discount airline by $6 to $40 a share, also reiterating their outperform overall rating for the stock.
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7722.0
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2016-12-14 00:00:00 UTC
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These Factors Show Why Buffett Likes Airlines Again
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AAL
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https://www.nasdaq.com/articles/these-factors-show-why-buffett-likes-airlines-again-2016-12-14
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By Frank Holmes :
Last month we learned that Warren Buffett bought shares of American Airlines ( AAL ), Delta Air Lines ( DAL ) and United Airlines ( UAL ), according to Berkshire Hathaway's ([[BRK.A]], [[BRK.B]]) third-quarter regulatory filings. He also confirmed that he purchased Southwest Airlines ( LUV ) stock. If we look at the Dow Jones U.S. Airlines Index year to date, these allocations appear to have been well-timed.
(click to enlarge)
Buffett is universally recognized as one of the most influential investors of all time, so his decision to book a flight on airlines, after blasting the industry for years, is worth examining more closely.
Protected by an Economic Moat
We can mention a couple of things upfront. Most everyone knows Buffett is a value investor. He seeks equity in companies that the market has undervalued, including airlines. As I've pointed out before, if we use price-to-earnings as our valuation metric, airlines are among the least expensive in the industrials sector.
He also likes companies that are protected by what he calls a "moat" - the "something" that prevents new competitors from disrupting the industry, giving the veteran players a clear advantage in the marketplace. This is why Buffett has always been attracted to railroads. Because rail is prohibitively capital-intensive, the barriers to entry are high and competition is limited, giving companies greater market power.
We see a similar moat protecting U.S. airlines. Since the industry consolidated a decade ago after a wave of bankruptcies, a vast majority of the market share is now concentrated in the big four carriers. In 2015, American, Delta, United and Southwest controlled about 77 percent of U.S. airline revenue.
These are pretty high-level factors to consider. When we delve deeper into the factors Buffett uses to assess equities, the airlines group becomes even more attractive.
Airlines Crushed the Broader Market
What you see below are the top 10 U.S. airlines compared to the S&P 500 Index, using four of Buffett's favorite financial metrics: return on equity, cash flow return on invested capital, net income margin and free cash flow per share. As of the third quarter, the airlines group trounced the broader market in all four areas for the 12-month period. This might have contributed to Buffett's decision to rotate back into a space he spent a couple of decades deriding.
(click to enlarge)
You can find the definitions of these factors on Investopedia, but they're pretty self-explanatory.
Return on equity (ROE) measures how much profit a company generates with shareholders' money. Whereas the S&P 500 returned about 14 percent during the 12-month period, airlines returned 36 percent of equity.
Cash flow return on invested capital (CFROIC) tells investors how much cash flow a company produces as a percentage of its total capital. CFROIC was 35.60 percent for carriers and 14.90 percent for blue-chip stocks.
Net income margin, simply put, is the percent difference between a company's sales and its net profits. In the past, airlines were notorious for having razor-thin margins. That's all changed thanks to industry consolidation, restructuring of businesses and the addition of new revenue streams. The top 10 airlines saw margins of more than 12 percent, while S&P 500 margins were 9.8 percent.
Finally, free cash flow per share is exactly what it sounds like. It's sometimes used as a proxy for earnings per share, but it specifically measures a company's ability to pay back loans, taxes and other expenses on a per share basis. Airlines beat the S&P 500, $4.1 per share to $3.3 per share.
Airlines have definitely come a long way since Buffett invested in - and lost money on - US Airways back in 1989.
All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.
Dow Jones U.S. Total Market Airlines Index is constructed and weighted using free-float market capitalization and the index is quotes in USD.
The S&P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in U.S. companies.
The price-earnings ratio (P/E ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings. The price-earnings ratio can be calculated as: market value per share / earnings per share.
Holdings may change daily. Holdings are reported as of the most recent quarter-end. The following securities mentioned in the article were held by one or more accounts managed by U.S. Global Investors as of 9/30/2016: Alaska Air Group Inc., Allegiant Travel Co., American Airlines Group Inc., Delta Air Lines Inc., Hawaiian Holdings Inc., JetBlue Airways Corp., Southwest Airlines Co., Spirit Airlines Inc., United Continental Holdings Inc., Virgin America Inc.
U.S. Global Investors, Inc. is an investment adviser registered with the Securities and Exchange Commission ("SEC"). This does not mean that we are sponsored, recommended, or approved by the SEC, or that our abilities or qualifications in any respect have been passed upon by the SEC or any officer of the SEC.
This commentary should not be considered a solicitation or offering of any investment product.
Certain materials in this commentary may contain dated information. The information provided was current at the time of publication.
See also Treasuries Melt Down, Junk Bonds Boom, Yield Spreads Collapse on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Frank Holmes : Last month we learned that Warren Buffett bought shares of American Airlines ( AAL ), Delta Air Lines ( DAL ) and United Airlines ( UAL ), according to Berkshire Hathaway's ([[BRK.A]], [[BRK.B]]) third-quarter regulatory filings. (click to enlarge) Buffett is universally recognized as one of the most influential investors of all time, so his decision to book a flight on airlines, after blasting the industry for years, is worth examining more closely. He also likes companies that are protected by what he calls a "moat" - the "something" that prevents new competitors from disrupting the industry, giving the veteran players a clear advantage in the marketplace.
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By Frank Holmes : Last month we learned that Warren Buffett bought shares of American Airlines ( AAL ), Delta Air Lines ( DAL ) and United Airlines ( UAL ), according to Berkshire Hathaway's ([[BRK.A]], [[BRK.B]]) third-quarter regulatory filings. Airlines Crushed the Broader Market What you see below are the top 10 U.S. airlines compared to the S&P 500 Index, using four of Buffett's favorite financial metrics: return on equity, cash flow return on invested capital, net income margin and free cash flow per share. Cash flow return on invested capital (CFROIC) tells investors how much cash flow a company produces as a percentage of its total capital.
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By Frank Holmes : Last month we learned that Warren Buffett bought shares of American Airlines ( AAL ), Delta Air Lines ( DAL ) and United Airlines ( UAL ), according to Berkshire Hathaway's ([[BRK.A]], [[BRK.B]]) third-quarter regulatory filings. Airlines Crushed the Broader Market What you see below are the top 10 U.S. airlines compared to the S&P 500 Index, using four of Buffett's favorite financial metrics: return on equity, cash flow return on invested capital, net income margin and free cash flow per share. Global Investors as of 9/30/2016: Alaska Air Group Inc., Allegiant Travel Co., American Airlines Group Inc., Delta Air Lines Inc., Hawaiian Holdings Inc., JetBlue Airways Corp., Southwest Airlines Co., Spirit Airlines Inc., United Continental Holdings Inc., Virgin America Inc. U.S.
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By Frank Holmes : Last month we learned that Warren Buffett bought shares of American Airlines ( AAL ), Delta Air Lines ( DAL ) and United Airlines ( UAL ), according to Berkshire Hathaway's ([[BRK.A]], [[BRK.B]]) third-quarter regulatory filings. Protected by an Economic Moat We can mention a couple of things upfront. Most everyone knows Buffett is a value investor.
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7723.0
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2016-12-13 00:00:00 UTC
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Why Warren Buffett Is Investing In Airlines
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AAL
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https://www.nasdaq.com/articles/why-warren-buffett-investing-airlines-2016-12-13
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Warren Buffett has gone on record numerous times as being adamantly against investing in airline companies, yet last month Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) disclosed that it had invested in four of the world's largest airline companies: American Airlines (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) .
In this clip, Motley Fool analyst Sean O'Reilly and contributor Adam Levine-Weinberg explain why Buffett had despised airlines in the past, what's changed in the past few years to make these airline companies compelling investments for Berkshire, and how macro-trends in the airline industry will affect consumers and companies going forward.
A full transcript follows the video.
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This podcast was recorded on Dec. 1, 2016.
Sean O'Reilly: This is a slightly older story than I would prefer, we had the holidays and everything, but I immediately messaged you on Slack when this news hit the wires. Berkshire Hathaway owns shares of the four largest airlines. I recently turned 30, sorry to say --
Adam Levine-Weinberg: It happens to all of us.
O'Reilly: Yeah, it happens to the best of us. I've been reading about Warren Buffett and investing for half of my life now. I wander into the library and I see these books, "Warren Buffett Way," and all that stuff, and all of them talk about, Buffett does invest in airlines. He's done it before, he gets burned. He did the preferred shares in US Airways. He always gets burned, and it is the quintessential example of a Warren Buffett mistake in that it's a commodity business. Then this hits the wires, and I just give up. I'm done. I'm just going to go quit and live on an island. What did you think? Give us some context, what's going on here?
Levine-Weinberg: I'd say, this news was much more surprising to me than the OPEC production cut.
O'Reilly: Boom, yeah. (laughs)
Levine-Weinberg: Yeah. (laughs) Because, Warren Buffett really has, for a good 20 years now, warned off investors at every opportunity from airline stocks. Even when airlines have been profitable, he said forget it, they're not sustainable businesses, stay away.
O'Reilly: What's that quote? Had a capitalist who wanted to make money been at Kitty Hawk with Wilbur and Orville Wright --
Levine-Weinberg: He would have shot down the plane to stop the airlines.
O'Reilly: (laughs) That's kind of harsh, man.
Levine-Weinberg: It's harsh. What he was saying was basically, investors have found this allure in airline stocks for decades, and they have poured billions and billions and billions of dollars into the industry, and that's just money that's been lost, not money that has been invested. You look over the whole history of the airline industry, it has been unprofitable.
O'Reilly: And you're talking about the 90-year history.
Levine-Weinberg: Yeah. That's decades and decades. So, it's not a bad industry cycle, that's just been the business, for history. So, it was definitely surprising to see Berkshire Hathaway buy these airline stocks. Now, it's important to recognize that at this point, Berkshire is a really big conglomerate, Buffett does not control all of the investing. He has two lieutenants who invest most of the excess money that Berkshire Hathaway has. It's most likely that one of those two guys bought the first three airline stock --
O'Reilly: What's the position sizes of these things?
Levine-Weinberg: It's not that big. In total, the investment seems to be under $1 billion. That's a lot of money for you and I, but for Berkshire Hathaway that's small change.
O'Reilly: What do you mean, Adam? What are you saying? (laughs)
Levine-Weinberg: (laughs) The first investments were in American Airlines, which is the largest position, then Delta Air Lines and United Continental. Those are the three biggest carriers, the remains of the legacy airline business. Those were probably not made by Buffett himself. According to Buffett, at least, he was at a conference or something, and Herb Kelleher, who's the founder of Southwest Airlines, was there, and they're old friends, so they got to talking, and Buffett got back and kind of felt bad that they'd invested in three out of four and not Southwest Airlines, so he was like, "Let's buy some Southwest Airlines, too."
O'Reilly: Oh, no. Is that what Buffett's doing? Has he been doing this for the last fifty years, and I just don't know it?
Levine-Weinberg: Hopefully not.
O'Reilly: Is that what he's been doing, and he's just been really lucky?
Levine-Weinberg: I just think, in this case, it was a small amount of money and he felt like --
O'Reilly: He didn't care, yeah.
Levine-Weinberg: -- if his guys thought the other three were good investments, he figured, why not Southwest as well.
O'Reilly: Really quick side note, I want to get your thoughts, I'm sure you're aware that another brilliant investment manager, David Tepper, he runs Appaloosa Management, he's personally worth $10 [billion] to $11 billion. Not bad. He made a bunch of money buying the airlines right after the Great Recession, but not immediately --
Levine-Weinberg: He was really early.
O'Reilly: Like 2010. He made almost three times his money on American, at least. I wanted to know what you thought about that, and why is Buffett late to the game on this, what's going on?
Levine-Weinberg: I think, Buffett obviously was late to the game because he had this long-standing position.
O'Reilly: Bias, we'll call it bias for now. (laughs)
Levine-Weinberg: All right, let's call it a bias, against airlines. He'd said, several years ago ... I'll get the quote here, this is from the 2007 Berkshire Hathaway investor letter. "The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines."
So, he just saw these businesses as constantly wanting to grow, growing so fast that they need to buy lots of planes. Planes cost tens of millions of dollars, in some cases, over $100 million apiece. And after they spent all this money to get started, they wouldn't actually make money in the long run.
O'Reilly: You're subject to the vagaries of ticket prices --
Levine-Weinberg: And OPEC.
O'Reilly: Or OPEC, yeah.
Levine-Weinberg: Yeah. It's demand, it's oil prices , it's whether you have labor troubles, almost all of these airlines have a high percentage of their workers that unionize, and every time you start to make money, the unions say, "We want a bigger share of the profits." And to some extent, the airlines have to give in. They're customer service businesses. For a couple years, they can push back, but they can't have dissatisfied workers for a really long time or it's going to start to have a major impact on their profit, either way that they go. Anyway, I think Tepper obviously saw much earlier than Buffett that there have been some changes in the airline industry that are really promising. What it really comes down to is, airlines aren't trying to just pursue growth, especially the larger airlines. They recognize that they need to be businesses, and they need to make a reasonable return for their investors. So, what you've seen is, when they're doing really well, they'll grow at a 4% to 5% rate, among these larger airlines. As soon as their profits start to take a hit, they pull back on capacity. You're seeing right now, during the second half of 2016, airline profits are starting to pull back up a bit, and most airlines have already announced that for 2017, they're going to grow 1% to 2%. That slower growth means you don't need to spend as much money on new planes.
O'Reilly: For our listeners, when you say growth, do you mean expanding routes? Buying new planes? Capex? What do you mean?
Levine-Weinberg: That's a good point. By growth I mean capacity growth.
O'Reilly: So, seats. (laughs)
Levine-Weinberg: Seats, and also distance. Sending one seat from New York to Beijing, obviously a lot more capacity than sending one seat from New York to Miami.
O'Reilly: This is an important airline industry term, like with restaurants, same-store sales growth?
Levine-Weinberg: Yeah. So, in terms of this capacity growth, the technical term is available seat miles.
O'Reilly: Insert eye roll.
Levine-Weinberg: Yeah. How many miles you send each seat, and add that up across the cross all the seats in your fleet. So, you have about a 2% growth rate or less for the three biggest airlines -- American, Delta, and United. And those are stocks that Tepper, I believe, has invested in in the past, made a lot of money there, and that's where Buffett's lieutenants made their first investments during the third quarter. With that slower growth, you have a better ability to keep fares higher, that you can earn double-digit margins or close to it, which is something that the airline industry never really did, looking back into previous cycles.
O'Reilly: With everything you've been saying, they're finally realizing they need to make money. Is the airline industry, after 80 to 90 years, finally maturing? What does this mean?
Levine-Weinberg: Yeah, I think it is maturing. Certainly, a lot of the problems that you saw back in the '90s and 2000s was, the U.S. airline industry was regulated up until the late '70s. So, after 1978, you had all of these airlines whose fares had previously been set by the government, essentially. Their costs were really high, they didn't have to compete on cost, so they didn't. So it's taken this long for the whole industry to shake itself out.
O'Reilly: That's a big deal, yeah.
Levine-Weinberg: And the thing is, you've had Southwest Airlines competing for a long time, but even as recently as 2000, they had something like $5 billion of revenue, which was less than 5% of the industry. Even with a company like Southwest Airlines -- a vigorous competitor, very low costs -- they didn't have the ability to completely overturn industry pricing at that point in time. Now, you have enough of these smaller airlines in addition to Southwest. You have the ultra low-cost carriers like Spirit Airlines and Frontier Airlines, you have people in the middle like JetBlue or Virgin America . With all of these companies, they forced the legacy carriers to get their costs to the point where they're not at parity, but they have a reasonable cost structure where they can make money year-in and year-out.
O'Reilly: Got it. Really quick, do any of the smaller carriers charge money for oxygen?
Levine-Weinberg: (laughs) Not yet.
O'Reilly: Not yet? OK, we'll find out.
Adam Levine-Weinberg owns shares of JetBlue Airways and Spirit Airlines. Adam Levine-Weinberg has the following options: long January 2017 $17 calls on JetBlue Airways, long January 2017 $40 calls on Delta Air Lines, and long December 2016 $30 calls on Spirit Airlines. Sean O'Reilly has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). The Motley Fool recommends JetBlue Airways and Spirit Airlines. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Warren Buffett has gone on record numerous times as being adamantly against investing in airline companies, yet last month Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) disclosed that it had invested in four of the world's largest airline companies: American Airlines (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) . Had a capitalist who wanted to make money been at Kitty Hawk with Wilbur and Orville Wright -- Levine-Weinberg: He would have shot down the plane to stop the airlines. With that slower growth, you have a better ability to keep fares higher, that you can earn double-digit margins or close to it, which is something that the airline industry never really did, looking back into previous cycles.
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Warren Buffett has gone on record numerous times as being adamantly against investing in airline companies, yet last month Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) disclosed that it had invested in four of the world's largest airline companies: American Airlines (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) . In this clip, Motley Fool analyst Sean O'Reilly and contributor Adam Levine-Weinberg explain why Buffett had despised airlines in the past, what's changed in the past few years to make these airline companies compelling investments for Berkshire, and how macro-trends in the airline industry will affect consumers and companies going forward. Adam Levine-Weinberg has the following options: long January 2017 $17 calls on JetBlue Airways, long January 2017 $40 calls on Delta Air Lines, and long December 2016 $30 calls on Spirit Airlines.
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Warren Buffett has gone on record numerous times as being adamantly against investing in airline companies, yet last month Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) disclosed that it had invested in four of the world's largest airline companies: American Airlines (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) . In this clip, Motley Fool analyst Sean O'Reilly and contributor Adam Levine-Weinberg explain why Buffett had despised airlines in the past, what's changed in the past few years to make these airline companies compelling investments for Berkshire, and how macro-trends in the airline industry will affect consumers and companies going forward. According to Buffett, at least, he was at a conference or something, and Herb Kelleher, who's the founder of Southwest Airlines, was there, and they're old friends, so they got to talking, and Buffett got back and kind of felt bad that they'd invested in three out of four and not Southwest Airlines, so he was like, "Let's buy some Southwest Airlines, too."
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Warren Buffett has gone on record numerous times as being adamantly against investing in airline companies, yet last month Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) disclosed that it had invested in four of the world's largest airline companies: American Airlines (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) . (laughs) Because, Warren Buffett really has, for a good 20 years now, warned off investors at every opportunity from airline stocks. Think airlines."
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7724.0
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2016-12-13 00:00:00 UTC
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How Did JetBlue Perform Operationally In November?
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AAL
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https://www.nasdaq.com/articles/how-did-jetblue-perform-operationally-november-2016-12-13
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nan
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JetBlue Corporation ( JBLU ) continued to perform well in its key metrics in the month of November. As in October, the carrier grew its capacity moderately at 5.2% y-o-y, when compared to previous months of 2016. Including this month, year to date capacity is up as much as 9.4% for JetBlue, highest in the industry. Further, the capacity was being used efficiently as indicated by the 150 bps gain in the load factor.
The capacity discipline, in addition to positive passenger yield in Latin America, helped the company turn around its unit revenues, which registered no change in the month. Moreover, due to the expectation of unit revenue growth turning positive in December, the company expects only a 1%-2% decline for the fourth quarter.
Its passenger traffic and passengers boarded increased by 7.1% and 6.2% respectively, in the month, bringing the year to date figures to 9.9% and 6.8%, respectively.
Have more questions about JetBlue Corporation ( JBLU )? See the links below:
Millennials And Their Increasing Contribution Toward Air Travel
How Did JetBlue Perform Operationally In October?
Higher Expenses Weigh On JetBlue's Q3'16 Results, Even As Unit Revenues Improve
JetBlue's Q3'16 Earnings Preview: Reduction In Capacity Expansion To Arrest The Decline In Unit Revenues
How Did JetBlue Perform Operationally In September?
How Has The State Of Air Travel In The U.S. Changed Over The Years?
How Has JetBlue's Financial Position Improved Over The Last Few Years?
Is Renewable Diesel The Way Forward For The U.S. Aviation Industry?
How Did JetBlue Perform Operationally In August?
Can Passenger Airlines Revive The Growth In The Air Cargo Industry?
How Are The U.S. Carriers Taking Advantage Of The Restoration Of Diplomatic Ties Between U.S. And Mexico/Cuba?
Why Has Trefis Revised Its Price Estimate For JetBlue To $18 Per Share?
Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM
JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results
What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value?
How Are US Air Fares Correlated To Crude Oil Prices?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for JetBlue Corporation
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The capacity discipline, in addition to positive passenger yield in Latin America, helped the company turn around its unit revenues, which registered no change in the month. See the links below: Millennials And Their Increasing Contribution Toward Air Travel How Did JetBlue Perform Operationally In October? For precise figures, please refer to our complete analysis for JetBlue Corporation View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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Higher Expenses Weigh On JetBlue's Q3'16 Results, Even As Unit Revenues Improve JetBlue's Q3'16 Earnings Preview: Reduction In Capacity Expansion To Arrest The Decline In Unit Revenues How Did JetBlue Perform Operationally In September? Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Including this month, year to date capacity is up as much as 9.4% for JetBlue, highest in the industry. Higher Expenses Weigh On JetBlue's Q3'16 Results, Even As Unit Revenues Improve JetBlue's Q3'16 Earnings Preview: Reduction In Capacity Expansion To Arrest The Decline In Unit Revenues How Did JetBlue Perform Operationally In September? Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value?
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Including this month, year to date capacity is up as much as 9.4% for JetBlue, highest in the industry. Higher Expenses Weigh On JetBlue's Q3'16 Results, Even As Unit Revenues Improve JetBlue's Q3'16 Earnings Preview: Reduction In Capacity Expansion To Arrest The Decline In Unit Revenues How Did JetBlue Perform Operationally In September? How Has The State Of Air Travel In The U.S. Changed Over The Years?
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7725.0
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2016-12-12 00:00:00 UTC
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Guidance Flies Higher at American Airlines and United Continental
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AAL
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https://www.nasdaq.com/articles/guidance-flies-higher-american-airlines-and-united-continental-2016-12-12
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nan
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nan
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In sizing up the top three U.S. airlines in terms of profitability, Delta Air Lines (NYSE: DAL) has been the clear winner for some time. That has left American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) to compete for second place.
United Airlines has been the least profitable major airline recently. Image source: The Motley Fool.
Back in October, both American and United gave fairly downbeat margin forecasts for Q4. However, conditions have improved as the quarter has progressed, leading both companies to raise their forecasts significantly.
Airline investors get a scare
Airlines' profits have soared since late 2014 because of the collapse of oil prices . However, some of the cost savings have been offset by unit revenue declines. Over the past two years, many investors have worried that this downward unit revenue trend would negatively affect airline profit margins once oil prices stabilized.
Oil prices bottomed out earlier this year, so most airlines are facing year-over-year fuel price increases now. Sure enough, profitability is starting to erode for both American Airlines and United Continental.
Early in the quarter, United Continental projected a fairly steep 4%-6% unit revenue decline for Q4. American Airlines expected a relatively moderate 1%-3% decrease in revenue per available seat mile (RASM), but it's currently plagued by runaway costs. The net result was the same in both cases: a sharp plunge of their pre-tax profit margins into single-digit territory.
American Airlines forecast that it would post a 4%-6% pre-tax margin in Q4, down from 13.4% in Q4 2015 . United's guidance wasn't much better: It forecast that its pre-tax margin would slip to a range of 5%-7% from 10.4% a year earlier.
Demand is bouncing back
Fortunately for American Airlines and United Continental shareholders, air travel demand is finally strengthening. This is driving better-than-expected revenue results across the industry. A month ago, American Airlines bumped up its RASM guidance range by 0.5 percentage points and raised its pre-tax margin guidance to a range of 5%-7%.
American Airlines has raised its Q4 margin guidance twice since November. Image source: American Airlines.
Last week, investors got even more good news. American Airlines now expects RASM to be roughly flat year over year in Q4, plus or minus 1 percentage point. As a result, it revised its pre-tax margin guidance to a range of 6%-8%, up a full 2 percentage points since late October.
The outlook is also improving at United Continental, which now estimates that unit revenue will decline 3%-4% this quarter. That improvement allowed United to raise its pre-tax margin guidance to a range of 7.5%-8.5%, putting it slightly ahead of American Airlines again.
This will be the second straight quarter that both American and United post unit revenue results at or above the high end of their original guidance ranges. That's an encouraging sign for investors weary of the airlines' long string of unit revenue declines.
Delta remains the leader
Two months ago, Delta Air Lines projected that its Q4 operating margin would be 14%-16%. That outlook implied that its pre-tax margin would be roughly 13%-15%. Thus, Delta expected its Q4 profit margin to be more than double those of its two main rivals.
Delta is still the most profitable of the legacy carriers. Image source: Delta Air Lines.
Since then, American and United have both raised their margin forecasts. By contrast, Delta recently slashed its operating margin guidance range to 9.5%-10.5% after handing out big pay raises to its pilots.
However, as part of their new contract, Delta's pilots will receive $380 million of retroactive pay this quarter. Excluding this retroactive pay, Delta's profit margin would be about 4 percentage points higher. Thus, on a like-for-like basis, Delta Air Lines remains well above American Airlines and United Continental in terms of profitability.
Delta will probably lose some ground to its two main rivals this quarter. That's not too surprising, considering it faced the toughest year-over-year revenue comparisons.
That said, as revenue comparisons get easier for Delta in the coming year, its unit revenue performance is likely to improve dramatically. The industry's nascent revenue recovery is mitigating what would otherwise be substantial margin declines at American Airlines and United Continental. But they will still be fighting for second place for the foreseeable future.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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That has left American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) to compete for second place. In sizing up the top three U.S. airlines in terms of profitability, Delta Air Lines (NYSE: DAL) has been the clear winner for some time. Over the past two years, many investors have worried that this downward unit revenue trend would negatively affect airline profit margins once oil prices stabilized.
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That has left American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) to compete for second place. A month ago, American Airlines bumped up its RASM guidance range by 0.5 percentage points and raised its pre-tax margin guidance to a range of 5%-7%. Delta remains the leader Two months ago, Delta Air Lines projected that its Q4 operating margin would be 14%-16%.
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That has left American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) to compete for second place. A month ago, American Airlines bumped up its RASM guidance range by 0.5 percentage points and raised its pre-tax margin guidance to a range of 5%-7%. That improvement allowed United to raise its pre-tax margin guidance to a range of 7.5%-8.5%, putting it slightly ahead of American Airlines again.
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That has left American Airlines (NASDAQ: AAL) and United Continental (NYSE: UAL) to compete for second place. American Airlines forecast that it would post a 4%-6% pre-tax margin in Q4, down from 13.4% in Q4 2015 . As a result, it revised its pre-tax margin guidance to a range of 6%-8%, up a full 2 percentage points since late October.
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7726.0
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2016-12-12 00:00:00 UTC
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How Did United Continental Perform Operationally In November?
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AAL
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https://www.nasdaq.com/articles/how-did-united-continental-perform-operationally-november-2016-12-12
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nan
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nan
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After a lukewarm third quarter due to weakness in passenger yields in the Atlantic (9.7%) and Pacific (2.6%) regions, United Continental maintained strict capacity discipline internationally in October in hopes to turn around its unit revenues. Continuing this trend in November, capacity only grew 1.6% y-o-y. Including this month, so far in the year, capacity is up only 1.3% for United. A marked improvement was also seen in the load factor or occupancy rate in November, owing to a cut in international capacity. The number of passengers onboarded continued to increase by 2.6% y-o-y in November, likely owing to its stellar operational performance in terms of on-time arrival and fewest cancellations.
Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to subside. It has revised its expected guidance from a decline of 4%-6% to 3%-4% in the final quarter of the year, mainly due to strong bookings in the second half of the quarter.
Have more questions about United Continental ( UAL )? See the links below:
How Will United Continental's Re-fleeting Initiatives Contribute To Its Earnings?
How Will United Continental Benefit From Segmentation And Fee Bundling?
How Does United Continental Plan To Optimize Its Network Potential?
How Did United Continental Perform Operationally In October?
United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump
United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM
How Did United Continental Perform Operationally In September?
What Is United Continental's New Fleet Plan?
Is China The New Growth Market For United Continental?
How Did United Continental Perform Operationally In August?
Why Are Airline Manufacturers Witnessing A Slowdown In Commercial Orders?
How Is United Continental Driving Cost Efficiency?
What Has Led To A 15% Fall In United's Stock Price Since The Beginning Of The Year?
What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly?
Is A Turnaround In The Cards For United Continental?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for United Continental
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The number of passengers onboarded continued to increase by 2.6% y-o-y in November, likely owing to its stellar operational performance in terms of on-time arrival and fewest cancellations. Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to subside. For precise figures, please refer to our complete analysis for United Continental View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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How Did United Continental Perform Operationally In October? United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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After a lukewarm third quarter due to weakness in passenger yields in the Atlantic (9.7%) and Pacific (2.6%) regions, United Continental maintained strict capacity discipline internationally in October in hopes to turn around its unit revenues. United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly?
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The number of passengers onboarded continued to increase by 2.6% y-o-y in November, likely owing to its stellar operational performance in terms of on-time arrival and fewest cancellations. United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com 2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively.
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7727.0
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2016-12-12 00:00:00 UTC
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How Did Southwest Perform Operationally In November?
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AAL
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https://www.nasdaq.com/articles/how-did-southwest-perform-operationally-november-2016-12-12
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nan
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nan
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After a disappointing third quarter, given a 3.4% y-o-y drop in revenues and a -5% decline in unit revenues, the company showcased some improvement in its October metric. Continuing with the uptrend, in November, the company was seen performing well in its key metrics. Keeping with its guidance of 5%-6% expansion in capacity in the year, Southwest's available seat miles in the month of November 2016 were up 4.9%. Including this month, so far in the year capacity is up as much as 5.8%. The occupancy rate improved by 1.8 percentage points on an annual basis to 85.1%, but was up only 50 bps for the full year. In terms of passenger traffic, the growth was 7.2%. The carrier remains hopeful to turn its revenues around in January due to impressive bookings it has received for the month and reduced capacity in 2017. However, the recently ratified labor contract will increase the company's operating costs by 3.5% in Q4'16. Consequently, we may see some adverse affect on the bottom line.
In terms of unit revenue, the company expects the decline to persist, with unit revenues down 4%-5% in the final quarter of the year, due to the timings of the Christmas holiday and regional price wars.
Have more questions about Southwest Airlines ( LUV )? See the links below:
Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak
Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings
How Did Southwest Airlines Perform Operationally In September?
Will International Expansion Be A Big Part Of Southwest's Future Growth Strategy?
How Did Southwest Airlines Perform Operationally In August?
What Are The Factors That Have Strengthened Southwest's Domestic Presence?
Why Are Airline Manufacturers Witnessing A Slowdown In Commercial Orders?
Has Southwest Been Able To Provide Meaningful Returns To Its Investors?
How Has Southwest's Cost Efficiency Improved?
Tracking Southwest's Capital Expenditure: How Has It Trended?
How Has Southwest Utilized Its Cash Flows?
How Will The New Labor Contract Affect Southwest?
Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share
Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018
Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Southwest Airlines
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Keeping with its guidance of 5%-6% expansion in capacity in the year, Southwest's available seat miles in the month of November 2016 were up 4.9%. The carrier remains hopeful to turn its revenues around in January due to impressive bookings it has received for the month and reduced capacity in 2017. For precise figures, please refer to our complete analysis for Southwest Airlines View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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See the links below: Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings How Did Southwest Airlines Perform Operationally In September? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things. Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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See the links below: Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings How Did Southwest Airlines Perform Operationally In September? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things. For precise figures, please refer to our complete analysis for Southwest Airlines View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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How Did Southwest Airlines Perform Operationally In August? How Will The New Labor Contract Affect Southwest? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things.
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7728.0
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2016-12-12 00:00:00 UTC
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American Airlines Gains on Bullish Q4 Unit Revenue View
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AAL
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https://www.nasdaq.com/articles/american-airlines-gains-on-bullish-q4-unit-revenue-view-2016-12-12
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nan
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nan
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Shares of American Airlines GroupAAL have been on an uptrend in recent times. The stock comfortably outperformed the Zacks-categorized Transportation-Airline industry over the last three months. The stock gained 32.83% compared with the industry which advanced 23.44% in the same timeframe.
Continuing its impressive performance, the stock gained 3.31% on Dec 10 to close the trading session at $49.64. The upsurge followed the bullish guidance unveiled by the company for the fourth quarter of 2016 with respect to total revenue per available seat mile (TRASM: a key measure of unit revenue). The metric is projected in the band of -1% to +1% in the fourth quarter. The view represents a marked improvement from the guidance issued last month when it expected the metric to decline in the band of 0.5-2.5%.
If American Airlines records TRASM growth in the fourth quarter, it will be the first carrier to do so in two years. The bullish guidance not only resulted in American Airlines' shares appreciating, but also those of other U.S. carriers like United Continental Holdings UAL , Delta Air Lines DAL and SkyWest, Inc. SKYW . Consequently, the NYSE ARCA Airline Index gained 1.52% to close Friday's trading session at $113.34.
We note that SkyWest carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
American Airlines, which carries a Zacks Rank #3 (Hold), not only provided an improved view for TRASM, but the guidance for pre-tax margin excluding special items has also been raised on the basis of higher yields. Pre-tax margin for the fourth quarter is now expected in the band of 6-8% compared with the prior guidance 5-7%.
The bullish views were revealed by the company while unveiling its November traffic data. Consolidated traffic measured in revenue passenger miles (RPMs) declined 0.2% on a year-over-year basis to $16.82 billion. The downside was primarily attributable to the 1.8% decline in domestic traffic.
Consolidated capacity (available seat miles/ASMs) inched up 0.1% to 20.79 billion in the month mainly due to 39.5% growth in ASMs, in the transpacific market. However, the load factor or the percentage of seats filled by passengers decreased 30 basis points (bps) to 80.9% in Nov 2016. This was primarily because capacity expanded while traffic contracted, leading to empty planes. Cargo miles improved 9% in November.
In the first 11 months of 2016, American Airlines recorded 0.3% growth in RPMs to 205.3 billion, while ASMs climbed 1.9% to 250.8 billion, both on a year-over-year basis. Also, load factor declined 130 bps to 81.8%. Moreover, total passenger count (Enplanements) slipped 1.1% for the same period.
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DELTA AIR LINES (DAL): Free Stock Analysis Report
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AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of American Airlines GroupAAL have been on an uptrend in recent times. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The view represents a marked improvement from the guidance issued last month when it expected the metric to decline in the band of 0.5-2.5%.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Shares of American Airlines GroupAAL have been on an uptrend in recent times. The bullish guidance not only resulted in American Airlines' shares appreciating, but also those of other U.S. carriers like United Continental Holdings UAL , Delta Air Lines DAL and SkyWest, Inc. SKYW .
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Shares of American Airlines GroupAAL have been on an uptrend in recent times. The upsurge followed the bullish guidance unveiled by the company for the fourth quarter of 2016 with respect to total revenue per available seat mile (TRASM: a key measure of unit revenue).
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Shares of American Airlines GroupAAL have been on an uptrend in recent times. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The stock gained 32.83% compared with the industry which advanced 23.44% in the same timeframe.
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7729.0
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2016-12-12 00:00:00 UTC
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United Airlines to Introduce New Boeing Aircraft to Fleet
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AAL
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https://www.nasdaq.com/articles/united-airlines-to-introduce-new-boeing-aircraft-to-fleet-2016-12-12
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nan
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nan
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United Airlines, the subsidiary of United Continental Holdings Inc.UAL , announced that it will launch the new Boeing 777-300ER aircraft for its flights scheduled in 2017. The company has added the aircraft to its schedule for the coming year. Notably, one of the key features of this offering will be the company's new United Polaris business class, which is scheduled to start regular service from February next year.
United Airlines recently reported its November traffic results. The company recorded an impressive increase in traffic and load factor. Consequently, shares of the company gained 3.34% since the release of its November performance and improved outlook for the fourth quarter. We note that the company has been performing well over the past few months and has comfortably surpassed the Zacks categorized Transportation-Airline industry over the last three months. The stock has gained over 41.16% compared with the industry, which has advanced just 20.45% over the same period.
New Aircraft Features and Plans
Passengers of United Airlines have several reasons to be excited about the new aircraft. In addition to United Polaris, the new planes will also contain the latest wide-body cabin design by the company. The interiors will have a modern look, which has been conceptualized in partnership with the popular design firm, PriestmanGoode. United Polaris offers privacy to passengers along with direct aisle access. Moreover, it comes with a 180-degree flat bed and mood lighting to provide passengers a sleep-enhancing experience - a desirable feature, especially for frequent travelers.
The Economy segment will be equipped with 102 seats and 34 inches of pitch in United Economy Plus and 204 seats with 31 inches of pitch in United Economy. Both will have a 3-4-3 seat configuration. Passengers would be able to enjoy two United Private Screening Options, in-seat power outlets, and the option to purchase satellite Wi-Fi.
Equipped with some of the latest desirable features, the new offering by United Airlines is expected to give tough competition to peers like American Airlines Group Inc. AAL , Delta Air Lines Inc. DAL , and Southwest Airlines Co. LUV .
Planned Routes for New Aircraft
The company expects to put all of its new Boeing 777-300ER aircrafts into service in 2017. The company intends to use the aircraft for one round trip from Newark Liberty International Airport to San Francisco International Airport, six days a week, in the Feb 16- May 4 period next year. Additionally, intercontinental service is scheduled to start from Mar 25, between San Francisco and Hong Kong. It should be noted that flight and aircraft schedules and dates are subject to changes.
Zacks Rank
United Continental currently has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today's most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
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AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Equipped with some of the latest desirable features, the new offering by United Airlines is expected to give tough competition to peers like American Airlines Group Inc. AAL , Delta Air Lines Inc. DAL , and Southwest Airlines Co. LUV . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Notably, one of the key features of this offering will be the company's new United Polaris business class, which is scheduled to start regular service from February next year.
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Equipped with some of the latest desirable features, the new offering by United Airlines is expected to give tough competition to peers like American Airlines Group Inc. AAL , Delta Air Lines Inc. DAL , and Southwest Airlines Co. LUV . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The Economy segment will be equipped with 102 seats and 34 inches of pitch in United Economy Plus and 204 seats with 31 inches of pitch in United Economy.
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Equipped with some of the latest desirable features, the new offering by United Airlines is expected to give tough competition to peers like American Airlines Group Inc. AAL , Delta Air Lines Inc. DAL , and Southwest Airlines Co. LUV . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. United Airlines, the subsidiary of United Continental Holdings Inc.UAL , announced that it will launch the new Boeing 777-300ER aircraft for its flights scheduled in 2017.
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Equipped with some of the latest desirable features, the new offering by United Airlines is expected to give tough competition to peers like American Airlines Group Inc. AAL , Delta Air Lines Inc. DAL , and Southwest Airlines Co. LUV . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. United Airlines recently reported its November traffic results.
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7730.0
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2016-12-09 00:00:00 UTC
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Nasdaq 100 Movers: LRCX, BIIB
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AAL
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https://www.nasdaq.com/articles/nasdaq-100-movers-lrcx-biib-2016-12-09
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nan
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nan
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In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 5.5%. Year to date, Biogen has lost about 0.3% of its value.
And the worst performing Nasdaq 100 component thus far on the day is Lam Research ( LRCX ), trading down 2.2%. Lam Research is showing a gain of 32.0% looking at the year to date performance.
Two other components making moves today are Skyworks Solutions ( SWKS ), trading down 1.9%, and American Airlines Group ( AAL ), trading up 4.5% on the day.
VIDEO: Nasdaq 100 Movers: LRCX, BIIB
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are Skyworks Solutions ( SWKS ), trading down 1.9%, and American Airlines Group ( AAL ), trading up 4.5% on the day. And the worst performing Nasdaq 100 component thus far on the day is Lam Research ( LRCX ), trading down 2.2%. Lam Research is showing a gain of 32.0% looking at the year to date performance.
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Two other components making moves today are Skyworks Solutions ( SWKS ), trading down 1.9%, and American Airlines Group ( AAL ), trading up 4.5% on the day. And the worst performing Nasdaq 100 component thus far on the day is Lam Research ( LRCX ), trading down 2.2%. VIDEO: Nasdaq 100 Movers: LRCX, BIIB The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are Skyworks Solutions ( SWKS ), trading down 1.9%, and American Airlines Group ( AAL ), trading up 4.5% on the day. In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 5.5%. And the worst performing Nasdaq 100 component thus far on the day is Lam Research ( LRCX ), trading down 2.2%.
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Two other components making moves today are Skyworks Solutions ( SWKS ), trading down 1.9%, and American Airlines Group ( AAL ), trading up 4.5% on the day. In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 5.5%. And the worst performing Nasdaq 100 component thus far on the day is Lam Research ( LRCX ), trading down 2.2%.
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7731.0
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2016-12-09 00:00:00 UTC
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S&P 500 Movers: GRMN, BIIB
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AAL
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https://www.nasdaq.com/articles/sp-500-movers-grmn-biib-2016-12-09
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nan
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nan
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In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the S&P 500 index, trading up 5.1%. Year to date, Biogen has lost about 0.7% of its value.
And the worst performing S&P 500 component thus far on the day is Garmin ( GRMN ), trading down 2.5%. Garmin is showing a gain of 35.2% looking at the year to date performance.
Two other components making moves today are AFLAC ( AFL ), trading down 2.3%, and American Airlines Group ( AAL ), trading up 4.4% on the day.
VIDEO: S&P 500 Movers: GRMN, BIIB
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are AFLAC ( AFL ), trading down 2.3%, and American Airlines Group ( AAL ), trading up 4.4% on the day. And the worst performing S&P 500 component thus far on the day is Garmin ( GRMN ), trading down 2.5%. Garmin is showing a gain of 35.2% looking at the year to date performance.
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Two other components making moves today are AFLAC ( AFL ), trading down 2.3%, and American Airlines Group ( AAL ), trading up 4.4% on the day. And the worst performing S&P 500 component thus far on the day is Garmin ( GRMN ), trading down 2.5%. VIDEO: S&P 500 Movers: GRMN, BIIB The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are AFLAC ( AFL ), trading down 2.3%, and American Airlines Group ( AAL ), trading up 4.4% on the day. In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the S&P 500 index, trading up 5.1%. VIDEO: S&P 500 Movers: GRMN, BIIB The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are AFLAC ( AFL ), trading down 2.3%, and American Airlines Group ( AAL ), trading up 4.4% on the day. In early trading on Friday, shares of Biogen ( BIIB ) topped the list of the day's best performing components of the S&P 500 index, trading up 5.1%. And the worst performing S&P 500 component thus far on the day is Garmin ( GRMN ), trading down 2.5%.
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7732.0
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2016-12-08 00:00:00 UTC
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Why Shares of the 3 Most Valuable U.S. Airlines Soared in November
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AAL
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https://www.nasdaq.com/articles/why-shares-3-most-valuable-us-airlines-soared-november-2016-12-08
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nan
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nan
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Delta Air Lines (NYSE: DAL) , Southwest Airlines (NYSE: LUV) , and American Airlines (NASDAQ: AAL) are the three most valuable airlines in the country. Their market capitalizations range from $25 billion all the way up to $37 billion. All three stocks surged during November, posting double-digit share price gains.
Southwest Airlines stock had the biggest increase, rising 16.4% last month. Delta and American weren't far behind, posting monthly gains of 15.3% and 14.4%, respectively, according to data from S&P Global Market Intelligence .
Delta Air Lines, American Airlines, and Southwest Airlines November Stock Performance, data by YCharts .
Mixed signals on the unit revenue front
Airline stocks gradually fell out of favor during 2015 and the first half of 2016, as airlines seemed unable to stem a series of unit revenue declines. However, in recent months, many airlines have indicated that they see a light at the end of the tunnel, with unit revenue likely to start growing again by early 2017. This has driven a sharp recovery in airline stocks.
During November itself, airline investors got mixed news on the unit revenue front. On the positive side, American Airlines raised its fourth-quarter unit revenue guidance range by 0.5 percentage points. It now expects revenue per available seat mile (RASM) to decline 0.5%-2.5% year over year for the full quarter.
On the other hand, in early November, Delta Air Lines reported a 6.5% decline in passenger revenue per available seat mile for the prior month. The company had already warned investors that its October unit revenue would be weak, but this result was still disappointing. Meanwhile, Southwest maintained its downbeat guidance for Q4 RASM to decline 4%-5% year over year.
It's all about Buffett
Thus, improving fundamentals weren't a major driver of rising stock prices at Delta Air Lines, Southwest Airlines, and American Airlines last month.
Instead, news that Warren Buffett's Berkshire Hathaway had invested in all four of the largest U.S. airlines was a key catalyst for the rally in major airline stocks. On Nov. 14, regulatory filings revealed that Berkshire had invested in American and Delta -- as well as United Continental -- during Q3. Warren Buffett quickly announced that the conglomerate had added shares of Southwest Airlines more recently.
Major Airlines Stock Performnace, June 26-December 7: data by YCharts .
Despite this strong stock performance, unit revenue has continued to decline at all three airlines. In fact, only American Airlines has made notable progress toward returning to unit revenue growth. Meanwhile, fuel prices have started to rise again and all three airlines have handed out big pay raises to various labor groups.
Thus, it's time for American Airlines, Delta Air Lines, and Southwest Airlines to deliver on investors' expectations. Unless they start reporting solid unit revenue growth within the next few quarters, the recent share price gains may prove to be short lived.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of Nov. 7, 2016
Adam Levine-Weinberg is long January 2017 $40 calls on Delta Air Lines. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Delta Air Lines (NYSE: DAL) , Southwest Airlines (NYSE: LUV) , and American Airlines (NASDAQ: AAL) are the three most valuable airlines in the country. On the positive side, American Airlines raised its fourth-quarter unit revenue guidance range by 0.5 percentage points. On the other hand, in early November, Delta Air Lines reported a 6.5% decline in passenger revenue per available seat mile for the prior month.
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Delta Air Lines (NYSE: DAL) , Southwest Airlines (NYSE: LUV) , and American Airlines (NASDAQ: AAL) are the three most valuable airlines in the country. Delta Air Lines, American Airlines, and Southwest Airlines November Stock Performance, data by YCharts . It's all about Buffett Thus, improving fundamentals weren't a major driver of rising stock prices at Delta Air Lines, Southwest Airlines, and American Airlines last month.
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Delta Air Lines (NYSE: DAL) , Southwest Airlines (NYSE: LUV) , and American Airlines (NASDAQ: AAL) are the three most valuable airlines in the country. Mixed signals on the unit revenue front Airline stocks gradually fell out of favor during 2015 and the first half of 2016, as airlines seemed unable to stem a series of unit revenue declines. It's all about Buffett Thus, improving fundamentals weren't a major driver of rising stock prices at Delta Air Lines, Southwest Airlines, and American Airlines last month.
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Delta Air Lines (NYSE: DAL) , Southwest Airlines (NYSE: LUV) , and American Airlines (NASDAQ: AAL) are the three most valuable airlines in the country. Delta Air Lines, American Airlines, and Southwest Airlines November Stock Performance, data by YCharts . During November itself, airline investors got mixed news on the unit revenue front.
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7733.0
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2016-12-07 00:00:00 UTC
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Alaska Air Group a Step Closer to Buying Virgin America
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AAL
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https://www.nasdaq.com/articles/alaska-air-group-a-step-closer-to-buying-virgin-america-2016-12-07
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nan
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nan
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Shares of Alaska Air GroupALK have been on an uptrend in recent times. The stock has comfortably outpaced the Zacks categorized Transportation-Airline industry over the last three months. The stock gained almost 19% compared with the industry, which advanced just 10.45% over the same period.
The Seattle, WA-based carrier, received further good news as it moved a step closer to buying the California based low-cost carrier Virgin America VA , following the receipt of the antitrust clearance from the U.S. Department of Justice (DOJ). Alaska Air Group intends to acquire Virgin America for approximately $57 per share. The deal , which is valued approximately at $4 billion, inclusive of debt and capitalized aircraft operating leases, was announced in April.
Attached Rider
The anti-trust clearance is however not free of conditions. Although Alaska Air Group won't have to sell any assets, it will have to reduce the scope of its code-sharing agreement with American Airlines Group AAL . Alaska Air Group currently derives around $190 million revenues annually from the agreement.
According to a report on Wall Street Journal , the modification of the agreement implies that Alaska Air Group would have to forego code-sharing revenues in about 45 markets, which amounts to $15 million to $20 million annually. The routes where the DOJ has prohibited the Alaska Air/American Airlines code sharing pertain to the ones where Virgin America and American Airlines currently compete. The same is also prohibited on routes where Alaska Air Group was likely to launch operations (in combination with American Airlines) following the closure of the deal. Alaska Air Group was not too perturbed by the condition and appeared confident of recovering the lost revenues.
However, Alaska Air Group's code-sharing deal with another heavy-weight airline - Delta Air Lines DAL - which accounts for approximately $65 million of Alaska Air Group's top line annually - was left untouched by the DOJ.
DOJ's Approval Did Not Come Easily
The DOJ's approval did not come immediately. The deal was initially expected to be closed by Sep 30. However, that was not the case as the companies agreed not to close the deal before Oct 17, to allow the antitrust division of the DOJ more time to review the proposed merger. Delays continued even after Oct 17, making its fate uncertain.
This approval is a positive step toward the completion of the deal, which is expected "in the very near future." Now, the lone hurdle that remains, is the ongoing lawsuit in the federal court of San Francisco, which was probably the reason why a date for closure was not mentioned. However, Alaska Air Group remains confident about the successful resolution of the dispute. Consequently, we expect investor focus to remain on updates regarding the lawsuit, the resolution of which would help the deal to close. This would then create the fifth largest U.S. airline (in terms of passenger traffic).
Zacks Rank
Alaska Air Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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DELTA AIR LINES (DAL): Free Stock Analysis Report
ALASKA AIR GRP (ALK): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
VIRGIN AMERICA (VA): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Although Alaska Air Group won't have to sell any assets, it will have to reduce the scope of its code-sharing agreement with American Airlines Group AAL . Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report VIRGIN AMERICA (VA): Free Stock Analysis Report To read this article on Zacks.com click here. The same is also prohibited on routes where Alaska Air Group was likely to launch operations (in combination with American Airlines) following the closure of the deal.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report VIRGIN AMERICA (VA): Free Stock Analysis Report To read this article on Zacks.com click here. Although Alaska Air Group won't have to sell any assets, it will have to reduce the scope of its code-sharing agreement with American Airlines Group AAL . However, Alaska Air Group's code-sharing deal with another heavy-weight airline - Delta Air Lines DAL - which accounts for approximately $65 million of Alaska Air Group's top line annually - was left untouched by the DOJ.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report VIRGIN AMERICA (VA): Free Stock Analysis Report To read this article on Zacks.com click here. Although Alaska Air Group won't have to sell any assets, it will have to reduce the scope of its code-sharing agreement with American Airlines Group AAL . However, Alaska Air Group's code-sharing deal with another heavy-weight airline - Delta Air Lines DAL - which accounts for approximately $65 million of Alaska Air Group's top line annually - was left untouched by the DOJ.
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Although Alaska Air Group won't have to sell any assets, it will have to reduce the scope of its code-sharing agreement with American Airlines Group AAL . Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report VIRGIN AMERICA (VA): Free Stock Analysis Report To read this article on Zacks.com click here. The routes where the DOJ has prohibited the Alaska Air/American Airlines code sharing pertain to the ones where Virgin America and American Airlines currently compete.
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7734.0
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2016-12-07 00:00:00 UTC
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The Alaska Air-Virgin America Merger Is (Almost) Cleared for Takeoff
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AAL
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https://www.nasdaq.com/articles/alaska-air-virgin-america-merger-almost-cleared-takeoff-2016-12-07
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nan
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nan
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After a delay of several months, U.S. antitrust regulators finally approved Alaska Air 's(NYSE: ALK) planned acquisition of smaller rival Virgin America (NASDAQ: VA) on Tuesday. This removes one of the last major obstacles to closing this deal by the end of 2016.
The Alaska Air-Virgin America merger took a big step forward on Tuesday. Image source: Alaska Airlines.
As expected, the DOJ did extract some concessions from Alaska Air. Most notably, the company agreed to scale back its codeshare arrangement with top U.S. carrier American Airlines (NASDAQ: AAL) . However, the merger still has lots of upside potential for Alaska Air.
Modest concessions seal the deal
As the DOJ's antitrust review dragged on this fall, some observers began to wonder whether the government would demand big concessions from Alaska Air. One possibility was that the DOJ would force the company to give up some slots or gates at key congested airports.
However, the agreement finalized this week doesn't include any divestitures. Instead, there are two key conditions.
First, Alaska Air will need DOJ approval if it wants to sell or lease out any of the gates and slots that American Airlines divested to Virgin America as part of its merger with US Airways. The DOJ insisted on this condition to ensure that Alaska doesn't sell any of those gates or slots back to a legacy carrier.
Second, Alaska will have to stop codesharing with American Airlines on 45 routes. For the most part, these are routes where either Alaska Air or Virgin America competes with American Airlines today. Alaska and American will also have to stop codesharing on a handful of routes to each other's hubs.
The idea behind this restriction is that the DOJ believes that Alaska treats American Airlines as more of a partner than a competitor in some markets. Scaling back the codeshare agreement is meant to force Alaska Air to compete more vigorously with American where feasible.
Alaska Air will stop codesharing with American Airlines on some routes. Image source: American Airlines.
Alaska Air's management reassured investors on Tuesday that the codesharing restrictions won't hurt much. Alaska generated $190 million of revenue from codesharing with American over the past year. The impacted routes only represent $60 million of that total, and Alaska expects to recapture $40 million-$45 million of revenue by tapping into other sources of travel demand. Thus, the net revenue impact will be a modest $15 million-$20 million.
No divestitures is a good thing -- for customers and investors
The DOJ's merger conditions are very reasonable and won't impact the economics of the merger agreement. Indeed, Alaska reiterated its target to achieve $175 million of annual revenue synergies and $50 million of annual cost synergies by 2020.
By contrast, major divestitures could have been harmful to consumers as well as investors. Alaska and Virgin America utilize their gate space fairly intensely in key markets like Seattle, San Francisco, and Los Angeles. If they had been forced to give up gate space at any of those airports, they may have had to cut some flights and certainly wouldn't have been able to grow any further.
Obviously, flight cutbacks would crimp profits. And even if the gates went to other low-fare carriers, consumers might be worse off -- especially in San Francisco, where post-merger Alaska Airlines will be the only airline with enough scale to compete effectively with market leader United Continental .
The merger should close soon
With the DOJ approval in hand, Alaska Air should be able to close its acquisition of Virgin America by year-end. That's good news for investors, as Alaska Air is already paying interest on more than $1.5 billion of debt that it raised a few months ago to cover most of the purchase price.
The only major barrier still standing in Alaska's way is a consumer lawsuit in federal court that aims to block the merger on the grounds that it would harm competition. Last month, the judge overseeing that case ruled that Alaska Air and Virgin America must give the court at least seven days' notice following the antitrust review before closing the merger.
Now that federal antitrust regulators are satisfied that the merger will be pro-competitive, it's much less likely that anything will come of the consumer lawsuit. Barring a stunning turn of events, Virgin America's history as an independent company will soon be at an end.
10 stocks we like better than Alaska Air Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Alaska Air Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of Nov. 7, 2016
Adam Levine-Weinberg owns shares of Alaska Air Group. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Most notably, the company agreed to scale back its codeshare arrangement with top U.S. carrier American Airlines (NASDAQ: AAL) . After a delay of several months, U.S. antitrust regulators finally approved Alaska Air 's(NYSE: ALK) planned acquisition of smaller rival Virgin America (NASDAQ: VA) on Tuesday. First, Alaska Air will need DOJ approval if it wants to sell or lease out any of the gates and slots that American Airlines divested to Virgin America as part of its merger with US Airways.
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Most notably, the company agreed to scale back its codeshare arrangement with top U.S. carrier American Airlines (NASDAQ: AAL) . After a delay of several months, U.S. antitrust regulators finally approved Alaska Air 's(NYSE: ALK) planned acquisition of smaller rival Virgin America (NASDAQ: VA) on Tuesday. For the most part, these are routes where either Alaska Air or Virgin America competes with American Airlines today.
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Most notably, the company agreed to scale back its codeshare arrangement with top U.S. carrier American Airlines (NASDAQ: AAL) . First, Alaska Air will need DOJ approval if it wants to sell or lease out any of the gates and slots that American Airlines divested to Virgin America as part of its merger with US Airways. For the most part, these are routes where either Alaska Air or Virgin America competes with American Airlines today.
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Most notably, the company agreed to scale back its codeshare arrangement with top U.S. carrier American Airlines (NASDAQ: AAL) . For the most part, these are routes where either Alaska Air or Virgin America competes with American Airlines today. No divestitures is a good thing -- for customers and investors The DOJ's merger conditions are very reasonable and won't impact the economics of the merger agreement.
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7735.0
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2016-12-06 00:00:00 UTC
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Why Is Alaska Air Betting Big On California?
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AAL
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https://www.nasdaq.com/articles/why-alaska-air-betting-big-california-2016-12-06
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nan
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nan
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Alaska Air ( ALK ), through its $2.6 billion acquisition of Virgin America, is aiming big at California. Although we are yet to hear on the final date of closing the deal, a spokesperson from the airline said that the deal is on track to close by the end of this year. The deal is expected to not only add $1.5 billion to the company's top line, but also help Alaska establish a powerful West Coast network by giving access to California's large customer base.
In the following note, we talk about Alaska's big bet on the Californian market for future growth.
1. California Is Almost Thrice The Size of Alaska's Three Top Markets
2. Alaska Has Huge Growth Potential In California Given Its Limited Market Share Of 7%
Before:
After:
3. California Is The Highest Ranking State In Terms Of GSP, Signifying Purchasing Power, and Ultimately Growth In Demand For Air Travel
4. Increased Access To Gates On West Coast To Make Alaska The Market Leader In LAX and SFO
5. A Vast Network Across The West Coast To Help Compete With Peers
See Our Complete Analysis For Alaska Air Here
Have more questions about Alaska Air ( ALK )? See the following links:
Airlines And The Federal Minimum Wage
How Did Alaska Air Perform Operationally In October?
Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion
Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings
How Did Alaska Air Perform Operationally In September?
Why Has Alaska Air's Stock Price Fallen 20% Since The Beginning Of The Year?
Will The Alaska Air-Virgin America Deal Get Delayed?
Why Are The Air Fares Offered By The U.S. Airlines Falling?
How Did Alaska Air Perform Operationally In August?
What Is The Role Of Passenger Airlines In The Air Cargo Industry?
Why Have We Revised Alaska Air's Price Estimate To $69 Per Share?
Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs
Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings
How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program?
Will Alaska Air-Virgin America Face Antitrust Issues?
How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital?
How Will Alaska Air's Market Share Change Post The Virgin America Deal?
Why Is Alaska Air Acquiring Virgin America?
How Will Alaska Air Benefit From The Virgin America Deal Operationally?
How Will The Expected Return On The Alaska Air-Virgin America Merger Compare With The Previous Deals In The Sector?
How Will The Virgin America Deal Alter Alaska Air's Capital Structure?
Has Alaska Air Paid A Fair Price For Acquiring Virgin America?
Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Alaska Air Group
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The deal is expected to not only add $1.5 billion to the company's top line, but also help Alaska establish a powerful West Coast network by giving access to California's large customer base. Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs Notes: 1) The purpose of these analyses is to help readers focus on a few important things. For precise figures, please refer to our complete analysis for Alaska Air Group View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings How Did Alaska Air Perform Operationally In September? Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A Vast Network Across The West Coast To Help Compete With Peers See Our Complete Analysis For Alaska Air Here Have more questions about Alaska Air ( ALK )? Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings How Did Alaska Air Perform Operationally In September? Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program?
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The deal is expected to not only add $1.5 billion to the company's top line, but also help Alaska establish a powerful West Coast network by giving access to California's large customer base. How Will Alaska Air's Market Share Change Post The Virgin America Deal? How Will Alaska Air Benefit From The Virgin America Deal Operationally?
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7736.0
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2016-12-05 00:00:00 UTC
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How Did Alaska Air Perform Operationally In November?
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AAL
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https://www.nasdaq.com/articles/how-did-alaska-air-perform-operationally-november-2016-12-05
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In the month of November, Alaska Air ( ALK ) saw all its key metrics improve. Keeping with the company's guidance to increase capacity by 10% in the year, the carrier saw its capacity rise 2.8%, bringing the year to date capacity to 9.2%. This makes the low cost carrier the only player in the industry continuing to expand its capacity, even in the face of pressure on unit revenues. Alaska's passenger traffic continued to impress at 7.0 growth, while the occupancy rate rose almost 3.4 percentage points to 85.1%. For the full year, traffic was up as much as 9.4%. However, Alaska's unit revenues are expected to remain in the negative territory, at -8%, for the full year, correcting itself the middle of next year, as macroeconomic conditions all over the world improve, and it completes its merger with Virgin America.
See Our Complete Analysis For Alaska Air Here
Have more questions about Alaska Air ( ALK )? See the following links:
Airlines And The Federal Minimum Wage
How Did Alaska Air Perform Operationally In October?
Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion
Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings
How Did Alaska Air Perform Operationally In September?
Why Has Alaska Air's Stock Price Fallen 20% Since The Beginning Of The Year?
Will The Alaska Air-Virgin America Deal Get Delayed?
Why Are The Air Fares Offered By The U.S. Airlines Falling?
How Did Alaska Air Perform Operationally In August?
What Is The Role Of Passenger Airlines In The Air Cargo Industry?
Why Have We Revised Alaska Air's Price Estimate To $69 Per Share?
Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs
Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings
How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program?
Will Alaska Air-Virgin America Face Antitrust Issues?
How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital?
How Will Alaska Air's Market Share Change Post The Virgin America Deal?
Why Is Alaska Air Acquiring Virgin America?
How Will Alaska Air Benefit From The Virgin America Deal Operationally?
How Will The Expected Return On The Alaska Air-Virgin America Merger Compare With The Previous Deals In The Sector?
How Will The Virgin America Deal Alter Alaska Air's Capital Structure?
Has Alaska Air Paid A Fair Price For Acquiring Virgin America?
Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Alaska Air Group
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This makes the low cost carrier the only player in the industry continuing to expand its capacity, even in the face of pressure on unit revenues. Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs Notes: 1) The purpose of these analyses is to help readers focus on a few important things. For precise figures, please refer to our complete analysis for Alaska Air Group View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings How Did Alaska Air Perform Operationally In September? Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program? Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs Notes: 1) The purpose of these analyses is to help readers focus on a few important things.
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See Our Complete Analysis For Alaska Air Here Have more questions about Alaska Air ( ALK )? Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings How Did Alaska Air Perform Operationally In September? Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program?
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Keeping with the company's guidance to increase capacity by 10% in the year, the carrier saw its capacity rise 2.8%, bringing the year to date capacity to 9.2%. Alaska Air Reports A Solid September Quarter On The Back Of Continued Capacity Expansion Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings How Did Alaska Air Perform Operationally In September? How Will Alaska Air Benefit From The Virgin America Deal Operationally?
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7737.0
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2016-12-01 00:00:00 UTC
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The Zacks Analyst Blog Highlights: American Airlines Group, JetBlue Airways, Delta Air Lines, United Continental Holdings and Lufthansa
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-american-airlines-group-jetblue-airways-delta-air-lines
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For Immediate Release
Chicago, IL - December 01, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Lufthansa (OTCMKTS: DLAKY - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Wednesday's Analyst Blog:
Airline Stock Roundup: AAL, JBLU, DAL, DLAKY
The past week saw U.S. based carriers like American Airlines Group (NASDAQ: AAL - Free Report ), JetBlue Airways (NASDAQ: JBLU - Free Report ) and United Continental Holdings (NYSE: UAL - Free Report ) commencing regularly scheduled commercial flights to Havana after more than five decades.
Germany's Lufthansa (OTCMKTS: DLAKY - Free Report ) also grabbed headlines, albeit for the wrong reasons. The carrier's operations are hampered significantly due to strikes by its pilots. The strikes, which have been ongoing for the past few days, are estimated to have hurt revenues to the tune of 10-15 million euros on a daily basis.
Pilots at Delta Air Lines (NYSE: DAL - Free Report ) , who are currently in the process of voting on a new labor deal, are apparently against the usage of big regional jets. The past week also saw United Continental's subsidiary, United Airlines, opening a new club at the Los Angeles International Airport (LAX).
Transportation - Airline Industry Price Index
(Read the last Airline Stock Roundup for Nov 23, 2016 ).
Recap of the Past Week's Most Important Stories
1. American Airlines was the first U.S. carrier to operate a commercial scheduled flight to the Cuban capital in more than five decades. JetBlue and United Continental were the other carriers to start such services. The American Airlines flight was from Miami, while the JetBlue flight took off from New York's John F. Kennedy International Airport. The United Continental flight departed from Newark Liberty International Airport (Read more: U.S. Air Carriers Bound for Cuba Amid Uncertainty ).
2. According to a report published on Reuters , the pilots of Atlanta, GA-based Delta are unlikely to alter the present rules and fly planes exceeding a certain weight on regional routes (Read more: Big Regional Jets: Still a No for Delta Pilots? ). The airline behemoth was also in the news when it imposed a life-time ban on an abusive passenger on one of its flights. The carrier apologized to the other passengers on the flight for the inconvenience.
3. In a customer-friendly move, United Airlines launched a new club at LAX. The latest "United Club" is part of the company's $573 million project to revamp its customer-facing spaces in Terminal 7 and Concourse 8 at the airport (Read more: United Continental Inaugurates United Club in Los Angeles ).
4. Labor troubles continued to hurt operations at Lufthansa with its pilots on strike over pay-related matters. The ongoing strike, the 15 th since early 2014, has significantly hurt operations, causing the carrier to cancel multiple flights each day. This has caused untold harassments, misery to its passengers of this Zacks Rank #1 (Strong Buy) company. You can see the complete list of today's Zacks #1 Rank stocks here .
5. In its first significant use of public cloud technology, American Airlines inked a cloud computing related deal with International Business Machines Corporation. According to the deal, the carrier can utilize the IBM Cloud for building new cloud-based applications. Going forward, IBM's analytics services will also be accessible to American Airlines as it aims to improve technology efficiency and flexibility. The two companies have a long-standing relationship and the latest deal further cements their ties.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free .
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Get the full Report on AAL - FREE
Get the full Report on JBLU - FREE
Get the full Report on DAL - FREE
Get the full Report on UAL - FREE
Get the full Report on DLAKY - FREE
Follow us on Twitter: https://twitter.com/zacksresearch
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com/
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.
This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AMER AIRLINES (AAL): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
LUFTHANSA -ADR (DLAKY): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Lufthansa (OTCMKTS: DLAKY - Free Report ). Here are highlights from Wednesday's Analyst Blog: Airline Stock Roundup: AAL, JBLU, DAL, DLAKY The past week saw U.S. based carriers like American Airlines Group (NASDAQ: AAL - Free Report ), JetBlue Airways (NASDAQ: JBLU - Free Report ) and United Continental Holdings (NYSE: UAL - Free Report ) commencing regularly scheduled commercial flights to Havana after more than five decades. Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on DLAKY - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Lufthansa (OTCMKTS: DLAKY - Free Report ). Here are highlights from Wednesday's Analyst Blog: Airline Stock Roundup: AAL, JBLU, DAL, DLAKY The past week saw U.S. based carriers like American Airlines Group (NASDAQ: AAL - Free Report ), JetBlue Airways (NASDAQ: JBLU - Free Report ) and United Continental Holdings (NYSE: UAL - Free Report ) commencing regularly scheduled commercial flights to Havana after more than five decades. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report LUFTHANSA -ADR (DLAKY): Free Stock Analysis Report To read this article on Zacks.com click here.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Lufthansa (OTCMKTS: DLAKY - Free Report ). Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on DLAKY - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report LUFTHANSA -ADR (DLAKY): Free Stock Analysis Report To read this article on Zacks.com click here.
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Here are highlights from Wednesday's Analyst Blog: Airline Stock Roundup: AAL, JBLU, DAL, DLAKY The past week saw U.S. based carriers like American Airlines Group (NASDAQ: AAL - Free Report ), JetBlue Airways (NASDAQ: JBLU - Free Report ) and United Continental Holdings (NYSE: UAL - Free Report ) commencing regularly scheduled commercial flights to Havana after more than five decades. Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Lufthansa (OTCMKTS: DLAKY - Free Report ). Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on DLAKY - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7738.0
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2016-11-30 00:00:00 UTC
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The Zacks Analyst Blog Highlights: American Airlines Group, JetBlue Airways, Delta Air Lines, United Continental Holdings and Southwest Airlines
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-american-airlines-group-jetblue-airways-delta-air-0
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nan
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For Immediate Release
Chicago, IL - November 30, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Tuesday's Analyst Blog:
U.S. Air Carriers Bound for Cuba Amid Uncertainty
A 50-year wait comes to an end, with U.S. carriers American Airlines Group Inc. (NASDAQ: AAL - Free Report ) and JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ) commencing flights to Havana, Cuba. American Airlines was the first U.S. carrier to operate a commercial flight to the Cuban capital in over five decades, followed by JetBlue. The American Airlines flight was from Miami, while the JetBlue flight took off from New York's John F. Kennedy International Airport. Both flights have already landed in Havana.
Launch Coincides with Cuba Mourning Fidel Castro
The commencement of direct flights to Havana comes at a time when Cuba is mourning the death of its former leader, Fidel Castro. We remind investors that diplomatic ties between the nations were severed by the U.S. in 1961 after Fidel Castro overthrew the Cuban government to set up a socialist state and in the process started to establish strong relations with the erstwhile Soviet Union. In late 2014, President Obama called for the restoration of diplomatic ties with the nation after consulting his Cuban counterpart Raul Castro (Fidel Castro's brother).
U.S. flights to other Cuban cities are already in operation, following the decision of the U.S. Department of Transportation (DOT) to authorize six U.S.-based carriers to operate scheduled flights to nine second-tier Cuban cities. After the announcement in June this year, the first commercial flight to Cuba from the U.S. was operated by JetBlue.
Havana Approval
However, the approval to fly to Havana came two months later - in August. The Havana routes were highly in demand among U.S. carriers as they collectively applied for the approval to operate nearly 60 flights to Havana on a daily basis. The agreement allowed for only 20 daily roundtrip flights between the nations.
On Aug 31, the U.S. DOT granted approval to eight carriers, including American, JetBlue, Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ) - to operate direct flights to Havana. American Airlines was the biggest winner as the carrier gained approval to operate 35 weekly flights. All the above-mentioned publicly traded carriers carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
With American Airlines and JetBlue having already commenced flights to Cuba, the other carriers are expected to follow suit. The top line of carriers should benefit significantly from operations to the new destination as Havana is a favorite tourist spot.
Transportation - Airline Industry Price Index
The Trump Impact
Despite the optimism surrounding the move, it remains to be seen what stance President-elect Donald Trump takes for Cuba, when he assumes office in January.
In fact, a report appearing on the Reuters mentioned that the President-elect recently tweeted that he may terminate the deal in the event of Cuba not doing enough for its people. Hence, the U.S. carriers are expected to chalk out schemes to ensure that the deal remains intact.
We expect investor focus to remain on this burning issue going forward.
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Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information >>
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free .
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Get the full Report on AAL - FREE
Get the full Report on JBLU - FREE
Get the full Report on DAL - FREE
Get the full Report on UAL - FREE
Get the full Report on LUV - FREE
Follow us on Twitter: https://twitter.com/zacksresearch
Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com/
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.
This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AMER AIRLINES (AAL): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
SOUTHWEST AIR (LUV): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ). Here are highlights from Tuesday's Analyst Blog: U.S. Air Carriers Bound for Cuba Amid Uncertainty A 50-year wait comes to an end, with U.S. carriers American Airlines Group Inc. (NASDAQ: AAL - Free Report ) and JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ) commencing flights to Havana, Cuba. Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on LUV - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ). Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report SOUTHWEST AIR (LUV): Free Stock Analysis Report To read this article on Zacks.com click here. Here are highlights from Tuesday's Analyst Blog: U.S. Air Carriers Bound for Cuba Amid Uncertainty A 50-year wait comes to an end, with U.S. carriers American Airlines Group Inc. (NASDAQ: AAL - Free Report ) and JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ) commencing flights to Havana, Cuba.
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Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ). Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on LUV - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report SOUTHWEST AIR (LUV): Free Stock Analysis Report To read this article on Zacks.com click here.
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Here are highlights from Tuesday's Analyst Blog: U.S. Air Carriers Bound for Cuba Amid Uncertainty A 50-year wait comes to an end, with U.S. carriers American Airlines Group Inc. (NASDAQ: AAL - Free Report ) and JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ) commencing flights to Havana, Cuba. Stocks recently featured in the blog include American Airlines Group Inc. (NASDAQ: AAL - Free Report ), JetBlue Airways Corp. (NASDAQ: JBLU - Free Report ), Delta Air Lines (NYSE: DAL - Free Report ), United Continental Holdings (NYSE: UAL - Free Report ) and Southwest Airlines Co. (NYSE: LUV - Free Report ). Get the full Report on AAL - FREE Get the full Report on JBLU - FREE Get the full Report on DAL - FREE Get the full Report on UAL - FREE Get the full Report on LUV - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7739.0
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2016-11-30 00:00:00 UTC
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U.S. Airlines Descend on Havana
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AAL
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https://www.nasdaq.com/articles/us-airlines-descend-havana-2016-11-30
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nan
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nan
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After finishing up the busy Thanksgiving travel weekend, a host of U.S. airlines are turning to a new project this week: opening up service to Havana.
American Airlines (NASDAQ: AAL) and JetBlue (NASDAQ: JBLU) operated their first scheduled flights to the Cuban capital on Monday. United Continental joined them on Tuesday, with more new routes from Delta Air Lines , Spirit Airlines (NASDAQ: SAVE) , and Frontier Airlines coming on Thursday. Southwest Airlines will join the fray in two weeks, with Alaska Air rounding out the pack in early 2017.
American Airlines operated its first scheduled flight to Havana this week. Image source: American Airlines.
The resumption of scheduled flights to Cuba (and especially Havana) after a more than 50-year hiatus is a historic event. However, some pundits may be misjudging the impact of these new routes. Indeed, airlines face a long, tough road to make their routes to Cuba profitable.
Cuba isn't like other markets
Cuba may seem similar to other Caribbean markets at first glance. But while tourism is a key driver of passenger traffic between the U.S. and other Caribbean islands (along with visiting friends and relatives), U.S. residents are still banned from traveling to Cuba for tourism.
Instead, Americans wanting to visit Cuba must certify that their trip will fall within one of 12 permitted categories of travel. These include family visits, educational or religious activities, cultural exchange programs, and humanitarian projects (among other things). Even if tourism were permitted, Cuba currently lacks the infrastructure to support a surge in tourist arrivals.
It's not easy to make a profit
Without being able to draw on pent-up tourist demand, airlines may have trouble making money on flights to Cuba. Retrenchment has already begun for routes to Cuba's secondary cities. In February, American Airlines will drop one of two daily flights in three secondary cities that it serves.
There is much more demand for flights to Havana. That said, U.S. airlines are adding 20 flights a day to Havana -- all on mainline planes -- in the span of five weeks. This will surely lead to substantial overcapacity in the market, keeping a lid on fares.
Indeed, JetBlue advertised introductory fares to Havana of $99 one-way from New York and $54 one-way from Florida. While fares are higher (and flights are nearly full) during the holiday peak season, JetBlue has sold less than half of the seats on most of its flights for the next three weeks, despite offering these bargain fares.
JetBlue's Havana flights have lots of empty seats despite rock-bottom fares. Image source: JetBlue Airways.
Prices need to go dramatically higher for airlines to make money. Indeed, Spirit Airlines is offering $155 roundtrip flights from Fort Lauderdale to Havana for just about any day in the next few weeks. Taxes and government fees account for more than 70% of the stated ticket price, though. Spirit will only keep a measly $43 of the total.
At least Spirit Airlines can fall back on its various ancillary revenue streams in an effort to break even. On many days, JetBlue is offering lower fares than Spirit from Florida to Havana, in some cases bringing in just a few dollars of revenue after deducting taxes and government fees. That will lead to steep losses.
The Trump administration could rewrite the rules
Of the airlines starting service to Havana, American Airlines and Spirit Airlines are the most likely to turn profitable within a reasonable period. Spirit has the lowest costs in the industry and can supplement its ticket sales with ancillary revenue. Meanwhile, American will benefit from its market-leading position in Miami and its unique ability to serve connecting traffic from cities without nonstop service to Cuba.
However, any progress they make could be quickly undone. President-elect Donald Trump has been critical of President Barack Obama's decision to restore U.S.-Cuba ties without demanding big concessions from Cuba. Thus, there is a significant chance that the incoming Trump administration will crack down on travel to Cuba.
Even if the government doesn't revoke the airlines' Cuban route authorities, it could tighten enforcement of the permitted categories of travel. This would likely reduce travel demand, hurting all of the U.S. airlines that serve Cuba.
Airlines are staking long-term claims
Airline executives recognize that the cost of operating in Cuba is high and that demand will take time to materialize. That's why airlines have been cautious about offering flights to smaller cities in Cuba (and why American Airlines is reducing service to some secondary cities).
However, for the foreseeable future, U.S. airlines will be limited to 20 daily flights to Havana. Most airlines are willing to take their lumps for the time being in order to get a share of those 20 daily flights. There's certainly some risk that demand for travel to Havana never really takes off. But it's a risk worth taking in light of the considerable long-term upside for U.S.-Havana travel.
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Adam Levine-Weinberg owns shares of Alaska Air Group, JetBlue Airways, and Spirit Airlines and is long January 2017 $17 calls on JetBlue Airways, long January 2017 $40 calls on Delta Air Lines, and long December 2016 $30 calls on Spirit Airlines. The Motley Fool recommends JetBlue Airways and Spirit Airlines. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (NASDAQ: AAL) and JetBlue (NASDAQ: JBLU) operated their first scheduled flights to the Cuban capital on Monday. On many days, JetBlue is offering lower fares than Spirit from Florida to Havana, in some cases bringing in just a few dollars of revenue after deducting taxes and government fees. Meanwhile, American will benefit from its market-leading position in Miami and its unique ability to serve connecting traffic from cities without nonstop service to Cuba.
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American Airlines (NASDAQ: AAL) and JetBlue (NASDAQ: JBLU) operated their first scheduled flights to the Cuban capital on Monday. United Continental joined them on Tuesday, with more new routes from Delta Air Lines , Spirit Airlines (NASDAQ: SAVE) , and Frontier Airlines coming on Thursday. That's why airlines have been cautious about offering flights to smaller cities in Cuba (and why American Airlines is reducing service to some secondary cities).
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American Airlines (NASDAQ: AAL) and JetBlue (NASDAQ: JBLU) operated their first scheduled flights to the Cuban capital on Monday. The Trump administration could rewrite the rules Of the airlines starting service to Havana, American Airlines and Spirit Airlines are the most likely to turn profitable within a reasonable period. That's why airlines have been cautious about offering flights to smaller cities in Cuba (and why American Airlines is reducing service to some secondary cities).
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American Airlines (NASDAQ: AAL) and JetBlue (NASDAQ: JBLU) operated their first scheduled flights to the Cuban capital on Monday. American Airlines operated its first scheduled flight to Havana this week. There is much more demand for flights to Havana.
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7740.0
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2016-11-30 00:00:00 UTC
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IBM's Cloud Platform Selected by American Airlines Group
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AAL
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https://www.nasdaq.com/articles/ibms-cloud-platform-selected-by-american-airlines-group-2016-11-30
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International Business Machines CorpIBM recently announced that its cloud platform, has been chosen by American Airlines Group Inc. AAL to enhance its enterprise scalability, flexibility and reliability.
The move will not only enable American Airlines to switch some of its enterprise applications to the cloud but also allow it to leverage IBM Cloud's global footprint that consists of more than 50 data centers across the world. Additionally, the airlines company will be able to take advantage of IBM Bluemix's application development capabilities. To top it all, American Airlines will have access to IBM's cognitive technologies that enable it to offer enhanced customer experience.
INTL BUS MACH Price
INTL BUS MACH Price | INTL BUS MACH Quote
What this Means for IBM?
In third-quarter 2016, IBM's total software revenue increased 3% year over year to $5.7 billion. Cognitive Solutions (solutions software and transaction processing software) revenues grew 4.5% year over year to $4.24 billion. Software solutions registered growth of 8%, driven primarily by analytics (Watson platform, Big Data, Information Integration). Cloud was up an impressive 74%.
With CEO Ginni Rometty's "strategic imperatives" in place, cloud remains a key focus area for IBM's revenue growth. Moreover, as per an IDC report, worldwide spending on public cloud services is estimated to reach $195 billion by 2020 that is currently growing at a CAGR of 20.4%.
These partnerships augur well for the company in the long run given the huge scope for cloud.
However, intensifying competition in the cloud space with the presence of major players such as Amazon.com, Inc.'s AMZN AWS and Microsoft's Azure remain a concern for IBM going ahead.
Stock Performance Overview
We note that IBM's stock price has underperformed the broader Zacks Computer Integrated Systems Industry over the last one year. While the stock generated a return of 18.83%, the sector generated a return of 27.89%.
The underperformance of the stock could be due to the ongoing and heavily time-consuming business model transition to cloud. Further, sluggish IT spending particularly on on-premise and data center hardware and foreign exchange volatility remain concerns. Moreover, intensifying competition in the cloud is a major headwind.
Nevertheless, IBM's strategic growth initiatives, including its Big Data & business analytics, cloud computing, mobile and social business are expected to drive growth in the future.
Zacks Rank and Key Picks
At present, IBM carries a Zacks Rank #3 (Hold).
A better ranked stock in the broader technology space is Diebold Inc DBD , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Notably, the consensus estimate for Diebold's current year has remained stable at $1.20 over the last seven days.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today's most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
INTL BUS MACH (IBM): Free Stock Analysis Report
DIEBOLD INC (DBD): Free Stock Analysis Report
AMAZON.COM INC (AMZN): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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International Business Machines CorpIBM recently announced that its cloud platform, has been chosen by American Airlines Group Inc. AAL to enhance its enterprise scalability, flexibility and reliability. Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report DIEBOLD INC (DBD): Free Stock Analysis Report AMAZON.COM INC (AMZN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. With CEO Ginni Rometty's "strategic imperatives" in place, cloud remains a key focus area for IBM's revenue growth.
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Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report DIEBOLD INC (DBD): Free Stock Analysis Report AMAZON.COM INC (AMZN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. International Business Machines CorpIBM recently announced that its cloud platform, has been chosen by American Airlines Group Inc. AAL to enhance its enterprise scalability, flexibility and reliability. INTL BUS MACH Price INTL BUS MACH Price | INTL BUS MACH Quote What this Means for IBM?
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Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report DIEBOLD INC (DBD): Free Stock Analysis Report AMAZON.COM INC (AMZN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. International Business Machines CorpIBM recently announced that its cloud platform, has been chosen by American Airlines Group Inc. AAL to enhance its enterprise scalability, flexibility and reliability. The move will not only enable American Airlines to switch some of its enterprise applications to the cloud but also allow it to leverage IBM Cloud's global footprint that consists of more than 50 data centers across the world.
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International Business Machines CorpIBM recently announced that its cloud platform, has been chosen by American Airlines Group Inc. AAL to enhance its enterprise scalability, flexibility and reliability. Click to get this free report INTL BUS MACH (IBM): Free Stock Analysis Report DIEBOLD INC (DBD): Free Stock Analysis Report AMAZON.COM INC (AMZN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The move will not only enable American Airlines to switch some of its enterprise applications to the cloud but also allow it to leverage IBM Cloud's global footprint that consists of more than 50 data centers across the world.
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7741.0
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2016-11-29 00:00:00 UTC
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The Zacks Analyst Blog Highlights: Bristol-Myers, Google, Deere, Halliburton and American Airlines
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-bristol-myers-google-deere-halliburton-and-american
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For Immediate Release
Chicago, IL - November 29, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ), Deere (NYSE: DE - Free Report ), Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Monday's Analyst Blog:
Top Research Reports for Tuesday
Today's Research Daily features new research reports on 16 major stocks, including Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ) and Deere (NYSE: DE - Free Report ).
Bristol-Myers shares have underperformed the broader market as well as the large cap pharma group this year, though the stock has turned around a bit since the election. Concerns about generic competition for several of its key products, particularly the HCV franchise, remain a major headwind for the stock. These issues notwithstanding, the analyst points out in the updated research reprot issued today Bristol-Myers' efforts to develop its pipeline and strengthen its product portfolio, primarily through acquisitions and deals. An operating model focused on accelerating pipeline development and streamlining infrastructure bodes well for growth. (You can read the full research report on Bristol-Myers here>> )
Google's parent Alphabet shares continued to lag the Tech sector as well as the broader market this year, but the company remains well positioned for the long run given its dominant share in a competitive, fast-growing search market. The analyst discusses the pros & cons of investing in Alphabet shares at present in the updated research report issued today. On the positive side, the analyst points out the company's focus on innovation, strategic acquisitions and Android OS should continue to generate strong cash flows. Its diversification strategy is also positive, but requires significant investment and involves uncertain payback periods, particularly since these efforts are at the cutting edge of technology. Additionally, growing competition and legal hassles could intensify with Brexit. (You can read the full research report on Google here>> )
Buy rated Deere shares have surged 36% over the year, handily beating the broader market as well as the farming machinery industry. The analyst emphasizes that the company has benefited from the proper execution of its operating plans, disciplined cost management as well as its broad product portfolio. It stands firm on its commitment to reduce structural costs through indirect and direct material cost reduction, reduced headcount and other initiatives. Increase in construction spending, improvement in political conditions in Brazil and positive conditions in India is likely to lead to better results. (You can read the full research report on Deere here>> )
Other noteworthy reports we are featuring today include Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ).
Confidential: Best Trades from Zacks Research
Would you like to see a hand-picked "all-star" selection of investment ideas from the man who heads up Zacks' trading and investing services? Steve Reitmeister knows when key trades are about to be triggered and which of our experts has the hottest hand. He is now prepared to pass them along to you. Today Steve is also opening up Zacks' 7 Best Stocks for October, 2016 free of charge. From 220 Zacks Rank #1 Strong Buys, this Special tabs 7 for immediate breakout. Click to access these private picks>>
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free .
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Get the full Report on BMY - FREE
Get the full Report on GOOGL - FREE
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Get the full Report on AAL - FREE
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.
This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
BRISTOL-MYERS (BMY): Free Stock Analysis Report
ALPHABET INC-A (GOOGL): Free Stock Analysis Report
DEERE & CO (DE): Free Stock Analysis Report
HALLIBURTON CO (HAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ), Deere (NYSE: DE - Free Report ), Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ). (You can read the full research report on Deere here>> ) Other noteworthy reports we are featuring today include Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ). Get the full Report on BMY - FREE Get the full Report on GOOGL - FREE Get the full Report on DE - FREE Get the full Report on HAL - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ), Deere (NYSE: DE - Free Report ), Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ). Click to get this free report BRISTOL-MYERS (BMY): Free Stock Analysis Report ALPHABET INC-A (GOOGL): Free Stock Analysis Report DEERE & CO (DE): Free Stock Analysis Report HALLIBURTON CO (HAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. (You can read the full research report on Deere here>> ) Other noteworthy reports we are featuring today include Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ).
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Get the full Report on BMY - FREE Get the full Report on GOOGL - FREE Get the full Report on DE - FREE Get the full Report on HAL - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report BRISTOL-MYERS (BMY): Free Stock Analysis Report ALPHABET INC-A (GOOGL): Free Stock Analysis Report DEERE & CO (DE): Free Stock Analysis Report HALLIBURTON CO (HAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Stocks recently featured in the blog include Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ), Deere (NYSE: DE - Free Report ), Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ).
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Stocks recently featured in the blog include Bristol-Myers (NYSE: BMY - Free Report ), Google (NASDAQ: GOOGL - Free Report ), Deere (NYSE: DE - Free Report ), Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ). (You can read the full research report on Deere here>> ) Other noteworthy reports we are featuring today include Halliburton (NYSE: HAL - Free Report ) and American Airlines (NASDAQ: AAL - Free Report ). Get the full Report on BMY - FREE Get the full Report on GOOGL - FREE Get the full Report on DE - FREE Get the full Report on HAL - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7742.0
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2016-11-23 00:00:00 UTC
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Southwest Airlines Announces Tentative Deal Ratification
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AAL
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https://www.nasdaq.com/articles/southwest-airlines-announces-tentative-deal-ratification-2016-11-23
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Southwest Airlines Co.LUV declared that its Appearance Technicians have ratified a four-year tentative deal with it. Aircraft Mechanics Fraternal Association ("AMFA") represents over 200 technicians of the company. Notably, 88% percent of the total votes were in favor of the deal that take effect immediately.
Southwest Airlines' Vice President of Maintenance Operations mentioned that the new contract is favorable for both the Agreement Technicians and the company. The deal not only offers increased pay and benefits to employees but also maintains the company's long-term business plan.
Recent Agreements Update
Southwest Airlines has lately seen progress in a number of decisions on key employee agreements. Earlier this month, the company's pilots ratified a new agreement. Per the Southwest Airlines Pilots' Association ("SWAPA"), the deal received approval from 84.26% of the voting pilots. Negotiations for this deal had started in 2012 and were guided by the National Mediation Board ("NMB")since 2014. The ratified agreement will become amenable in Nov 2020.
Southwest Airlines saw another tentative agreement being ratified in October. Represented by Transport Workers Union ("TWU") Local 556, the company's flight attendants voted in favor of the tentative deal outlined in Sep 2016. Per the Union, 53.86% of the voters were in favor of the deal.
Employee contracts are an integral part for smooth functioning of the airline especially since it faces intense competition from peers such as JetBlue Airways Co. JBLU , American Airlines Group Inc. AAL and Delta Air Lines Inc. DAL .
Zacks Rank
Southwest Airlines carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today's most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
SOUTHWEST AIR (LUV): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Employee contracts are an integral part for smooth functioning of the airline especially since it faces intense competition from peers such as JetBlue Airways Co. JBLU , American Airlines Group Inc. AAL and Delta Air Lines Inc. DAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Southwest Airlines' Vice President of Maintenance Operations mentioned that the new contract is favorable for both the Agreement Technicians and the company.
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Employee contracts are an integral part for smooth functioning of the airline especially since it faces intense competition from peers such as JetBlue Airways Co. JBLU , American Airlines Group Inc. AAL and Delta Air Lines Inc. DAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Employee contracts are an integral part for smooth functioning of the airline especially since it faces intense competition from peers such as JetBlue Airways Co. JBLU , American Airlines Group Inc. AAL and Delta Air Lines Inc. DAL . Southwest Airlines Co.LUV declared that its Appearance Technicians have ratified a four-year tentative deal with it.
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Employee contracts are an integral part for smooth functioning of the airline especially since it faces intense competition from peers such as JetBlue Airways Co. JBLU , American Airlines Group Inc. AAL and Delta Air Lines Inc. DAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Southwest Airlines' Vice President of Maintenance Operations mentioned that the new contract is favorable for both the Agreement Technicians and the company.
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7743.0
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2016-11-22 00:00:00 UTC
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3 Stocks Billionaires Are Buying
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AAL
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https://www.nasdaq.com/articles/3-stocks-billionaires-are-buying-2016-11-22
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Warren Buffett, George Soros, and Carl Icahn are among the most successful investors of all time, so following in their footsteps could prove profit-friendly. Fortunately, these gurus file 13F reports with the Securities and Exchange Commission every quarter that show exactly what they've been stashing away in their portfolios. Since 13F reports can be a treasure trove of new investment ideas, let's take a closer look at their most recent disclosures and see what these billionaire money managers have been buying lately.
AAL Net Income (TTM) data by YCharts .
Berkshire's managers appear to believe that this profit-first mentality will continue to pay off, especially if jet fuel prices remain in check. Jet fuel accounts for over 20% of an airline's operating costs, and lower jet fuel prices this year are providing a $21 billion tailwind for the industry globally, according to the International Air Transport Association.
That's good news for airlines, and perhaps a big reason why Berkshire has become fond of them.
Henry Hub Natural Gas Spot Price data by YCharts .
Soros bought 3.1 million shares in Williams Companies last quarter to gain exposure to pipeline capacity serving some of the most prolific natural gas regions in the country. Williams Companies' Transco pipeline, for example, runs up and down the East Coast, from South Texas to New York City, transporting natural gas from the Gulf Coast, mid-continent, and Appalachia to Southeastern, mid-Atlantic, and Northeastern states. Transco is major source of natural gas to the Northeast, so Williams Companies could benefit if cold-weather-related demand boosts natural gas prices and volume.
In the long term, Williams Companies could deliver growth to investors if its decision to cut its dividend to accelerate its expansion plans pays off. The company's slate of pipeline projects includes Atlantic Sunrise, a project that could increase natural gas takeaway in Pennsylvania's highly productive Marcellus shale. When it's complete, Atlantic Sunrise will add 1.7 billion cubic feet per day of capacity to the region.
Currently, the Atlantic Sunrise project is being delayed by regulators seeking more input from residents. However, hurdles could become more easily overcome now that Donald Trump is heading to the White House. On the campaign trail, Trump proposed reducing regulation and increasing energy infrastructure and energy production. If he follows through on those plans, the benefit for Williams Companies would be significant.
Admittedly, George Soros doesn't typically hold on to his stocks for very long, so Williams Companies could disappear from his portfolio as quickly as it appeared. Nevertheless, investors might not want to ignore Williams Companies, because if demand for natural gas increases and it can execute on its expansion plans, it may be able to restart its dividend more quickly than hoped.
Image source: Carl Icahn via Twitter.
Carl Icahn boosts a big bet
Carl Icahn is famous for taking big and concentrated positions in stocks so that he can lobby for shareholder-friendly actions, such as dividend payouts and divestitures. In the case of Carl Icahn's big investment in Herbalife (NYSE: HLF) , his interest may be more catalyst-driven.
Herbalife has long been in the crosshair of hedge fund money manager Bill Ackman, who is short the company and has been a big critic of Herbalife's business model. Ackman has painted a picture of Herbalife as a Ponzi scheme that's reliant on securing new people to distribute its nutritional products, rather than retail sales.
Ackman's ongoing criticism eventually led to a Federal Trade Commission (FTC) investigation of Herbalife, and the potential to settle that investigation may have been why Icahn established a massive 18% stake in the company.
In July, Herbalife agreed to a $200 million settlement that includes a restructuring of its business. After Herbalife settled with the FTC, rumors emerged that Icahn might be interested in selling his Herbalife shares. However, rather than selling, Icahn bought even more shares. Icahn reports owning 19.6 million shares in Herbalife as of Sept. 30, up 15.36% from the end of June.
It's anyone's guess how long Icahn will remain a Herbalife investor, but he hasn't shown much interest (yet) in selling, and Ackman continues to be short. Perhaps Icahn hopes Ackman and other short-sellers will cover their positions, sending shares even higher. If so, then this story's end may be determined by who blinks first. If Icahn sells his stake, shares could drop. But if Ackman covers his short first, shares could pop. That dynamic makes Herbalife a bit of a binary investment, so investors ought to approach it cautiously.
10 stocks we like better than Williams Companies
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Williams Companies wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of November 7, 2016
Todd Campbell has no position in any stocks mentioned.Todd owns E.B. Capital Markets, LLC. E.B. Capital's clients may have positions in the companies mentioned.Like this article? Follow him on Twitter where he goes by the handle @ebcapitalto see more articles like this.
The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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AAL Net Income (TTM) data by YCharts . Soros bought 3.1 million shares in Williams Companies last quarter to gain exposure to pipeline capacity serving some of the most prolific natural gas regions in the country. Admittedly, George Soros doesn't typically hold on to his stocks for very long, so Williams Companies could disappear from his portfolio as quickly as it appeared.
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AAL Net Income (TTM) data by YCharts . Soros bought 3.1 million shares in Williams Companies last quarter to gain exposure to pipeline capacity serving some of the most prolific natural gas regions in the country. Transco is major source of natural gas to the Northeast, so Williams Companies could benefit if cold-weather-related demand boosts natural gas prices and volume.
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AAL Net Income (TTM) data by YCharts . Transco is major source of natural gas to the Northeast, so Williams Companies could benefit if cold-weather-related demand boosts natural gas prices and volume. Carl Icahn boosts a big bet Carl Icahn is famous for taking big and concentrated positions in stocks so that he can lobby for shareholder-friendly actions, such as dividend payouts and divestitures.
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AAL Net Income (TTM) data by YCharts . Nevertheless, investors might not want to ignore Williams Companies, because if demand for natural gas increases and it can execute on its expansion plans, it may be able to restart its dividend more quickly than hoped. Icahn reports owning 19.6 million shares in Herbalife as of Sept. 30, up 15.36% from the end of June.
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7744.0
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2016-11-19 00:00:00 UTC
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Warren Buffett's Berkshire Hathaway Just Made 2 Big Stock Moves
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AAL
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https://www.nasdaq.com/articles/warren-buffetts-berkshire-hathaway-just-made-2-big-stock-moves-2016-11-19
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nan
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DAL data by YCharts .
In addition, the airline business has changed significantly since Buffett last dipped his toes in the water. Airlines have done a good job of keeping expenses in check in recent years, and have produced strong margins. All are generating strong cash flow, and have been aggressive about returning capital to shareholders.
A not-so-surprising sale
In a less-surprising move, Berkshire reported that it got rid of about 70% of its stake in Wal-Mart Stores (NYSE: WMT) , a large amount of stock that is valued at about $2.1 billion as I write this.
I say that this isn't much of a surprise for a couple of reasons. First, Berkshire has been disposing of its Wal-Mart stake in recent quarters. The previous sales have been much smaller, but it has become clear that Berkshire has a somewhat bearish view of Wal-Mart right now.
While we don't know for sure exactly why Berkshire is getting rid of Wal-Mart, I can say with confidence that it is becoming less of a "Buffett stock." Specifically, it has been gradually losing the competitive advantage it enjoyed in the pre-internet economy. In its prime, Wal-Mart was able to undercut virtually every other retailer, thanks to its scale, no-frills store design, and efficient distribution network.
These days, this simply isn't the case. Internet retailers, particularly Amazon.com, can operate just as efficiently as Wal-Mart, and as a result, Wal-Mart's market share has begun to erode. To be perfectly clear, Wal-Mart will be just fine as a business, but an eroding market share and competitive advantage are the exact opposite of what Warren Buffett likes to see in his stock investments.
Should you follow Buffett?
Not necessarily. I wouldn't go so far as to call the airlines a bad investment right now, but it's safe to say that they're significantly more expensive than the price Buffett paid for them. And Wal-Mart still has a bright future ahead of it, in my opinion, so I'd be reluctant to sell if I were already a shareholder.
It can be a great idea to follow the moves of billionaire investors -- not necessarily to make the same moves, but for the investing lessons that can be learned. For example, in Wal-Mart's case, the lesson is "when the reasons you originally bought a stock no longer apply, it's time to reevaluate your investment." There are valuable lessons you can learn from all of Buffett's investment activity, so it's important to read between the lines when he (or another billionaire) buys or sells a stock.
Forget the 2016 Election: 10 stocks we like better than Berkshire Hathaway (A shares)
Donald Trump was just elected president, and volatility is up. But here's why you should ignore the election:
Investing geniuses Tom and David Gardner have spent a long time beating the market no matter who's in the White House. In fact, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Berkshire Hathaway (A shares) wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as ofNovember 7, 2016
Matthew Frankel owns shares of Berkshire Hathaway (B shares). The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A not-so-surprising sale In a less-surprising move, Berkshire reported that it got rid of about 70% of its stake in Wal-Mart Stores (NYSE: WMT) , a large amount of stock that is valued at about $2.1 billion as I write this. To be perfectly clear, Wal-Mart will be just fine as a business, but an eroding market share and competitive advantage are the exact opposite of what Warren Buffett likes to see in his stock investments. But here's why you should ignore the election: Investing geniuses Tom and David Gardner have spent a long time beating the market no matter who's in the White House.
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To be perfectly clear, Wal-Mart will be just fine as a business, but an eroding market share and competitive advantage are the exact opposite of what Warren Buffett likes to see in his stock investments. It can be a great idea to follow the moves of billionaire investors -- not necessarily to make the same moves, but for the investing lessons that can be learned. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares).
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While we don't know for sure exactly why Berkshire is getting rid of Wal-Mart, I can say with confidence that it is becoming less of a "Buffett stock." To be perfectly clear, Wal-Mart will be just fine as a business, but an eroding market share and competitive advantage are the exact opposite of what Warren Buffett likes to see in his stock investments. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Berkshire Hathaway (A shares) wasn't one of them!
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While we don't know for sure exactly why Berkshire is getting rid of Wal-Mart, I can say with confidence that it is becoming less of a "Buffett stock." To be perfectly clear, Wal-Mart will be just fine as a business, but an eroding market share and competitive advantage are the exact opposite of what Warren Buffett likes to see in his stock investments. It can be a great idea to follow the moves of billionaire investors -- not necessarily to make the same moves, but for the investing lessons that can be learned.
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7745.0
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2016-11-19 00:00:00 UTC
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American Airlines (AAL) Has Been Soaring Since Earnings, Can It Continue?
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AAL
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https://www.nasdaq.com/articles/american-airlines-aal-has-been-soaring-since-earnings-can-it-continue-2016-11-19
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nan
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nan
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A month has gone by since the last earnings report for American Airlines (AAL). Shares have added about 18 % in the past month, easily outpacing the S&P 500 in that time frame.
Will the recent positive trend continue leading up to their next earnings release, or is the stock due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Recent Earnings
Third Quarter Earnings
American Airlines reported better-than-expected earnings in the third quarter of 2016. The company posted adjusted earnings per share of $2.80 that comfortably beat the Zacks Consensus Estimate of $1.68. Quarterly earnings increased more than 1% year over year.
Revenues of $10,594 million were 1.1% below the year-ago figure but edged past the Zacks Consensus Estimate of $10,549 million. Consolidated passenger revenue per available seat mile declined 3.3% to 12.72 cents in the reported quarter. Consolidated yield dipped 0.6% to 15.27 cents. Total revenue per available seat mile declined 2.2% to 14.73 cents.
Traffic was down 1.6%, whereas capacity was up 1.2%. This resulted in relatively empty planes. Consolidated load factor declined as traffic contracted while capacity expanded. Load factor deteriorated to 83.3% from the comparable year-ago figure of 85.6%.
Total operating expenses rose 5.2% to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company and an $86 million accrual pertaining to the carrier's profit sharing program contributed to the increase in expenses.
Fuel price per gallon (mainline) for the fourth quarter is projected in the band of $1.59 to $1.64. Fuel price per gallon (regional) for the fourth quarter is projected in the band of $1.65 to $1.70. The carrier expects consolidated fuel costs to witness a year-over-year decline of approximately $1.2 billion in 2016.
How have estimates been moving since then?
It turns out, fresh estimates have trended downward during the past month. There have been two revisions higher for the current quarter compared to three lower in the month since the earnings report came out. The consensus estimate has shifted by -5.6 % due to these changes, and the move lower is evident in this chart below, even though shares of AAL have gone in the right direction:
AMER AIRLINES Price and Consensus
AMER AIRLINES Price and Consensus | AMER AIRLINES Quote
VGM Scores
At this time, American Airlines' stock has a nice Growth score of 'B', though it is lagging on the momentum front with a 'D'. However, the stock was allocated a grade of 'A' on the value side, putting it in the first quintile for this investment strategy. Overall, the stock looks pretty impressive from a fundamental look, as the company has a VGM score of 'A', putting it into the 20% of all the companies we research.
Outlook
Overall estimate activity has been mixed for AAL stock. Yes, short term figures aren't great, but if you look a little further out the expectations are more impressive. Due to this back and forth nature, we have shares of AAL at a Zacks Rank # 3 (hold), meaning we are expecting an in-line return from AALin the next few months. However, investors focused on value will likely appreciate the story in American Airlines stock more than most.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Due to this back and forth nature, we have shares of AAL at a Zacks Rank # 3 (hold), meaning we are expecting an in-line return from AALin the next few months. A month has gone by since the last earnings report for American Airlines (AAL). The consensus estimate has shifted by -5.6 % due to these changes, and the move lower is evident in this chart below, even though shares of AAL have gone in the right direction: AMER AIRLINES Price and Consensus AMER AIRLINES Price and Consensus | AMER AIRLINES Quote VGM Scores At this time, American Airlines' stock has a nice Growth score of 'B', though it is lagging on the momentum front with a 'D'.
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The consensus estimate has shifted by -5.6 % due to these changes, and the move lower is evident in this chart below, even though shares of AAL have gone in the right direction: AMER AIRLINES Price and Consensus AMER AIRLINES Price and Consensus | AMER AIRLINES Quote VGM Scores At this time, American Airlines' stock has a nice Growth score of 'B', though it is lagging on the momentum front with a 'D'. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. A month has gone by since the last earnings report for American Airlines (AAL).
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The consensus estimate has shifted by -5.6 % due to these changes, and the move lower is evident in this chart below, even though shares of AAL have gone in the right direction: AMER AIRLINES Price and Consensus AMER AIRLINES Price and Consensus | AMER AIRLINES Quote VGM Scores At this time, American Airlines' stock has a nice Growth score of 'B', though it is lagging on the momentum front with a 'D'. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. A month has gone by since the last earnings report for American Airlines (AAL).
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A month has gone by since the last earnings report for American Airlines (AAL). The consensus estimate has shifted by -5.6 % due to these changes, and the move lower is evident in this chart below, even though shares of AAL have gone in the right direction: AMER AIRLINES Price and Consensus AMER AIRLINES Price and Consensus | AMER AIRLINES Quote VGM Scores At this time, American Airlines' stock has a nice Growth score of 'B', though it is lagging on the momentum front with a 'D'. Outlook Overall estimate activity has been mixed for AAL stock.
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7746.0
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2016-11-18 00:00:00 UTC
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Like Buffett, Why You Should Find Value in Airline ETF
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AAL
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https://www.nasdaq.com/articles/buffett-why-you-should-find-value-airline-etf-2016-11-18
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nan
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nan
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Who doesn't want to invest likethe Oracle of Omaha or Warren Buffett? After all, this Wall Street guru has successfully put his money in the right place and continues to reap huge returns. Buffett's Berkshire Hathaway Inc. BRK.B is up about 19% so far this year (as of November 16, 2016) and added over 115% in the last five years compared to the S&P 500's 6.5% gains this year and an 87.9% five-year return.
Following an investor of this aptitude will surely be anybody's dream. Normally, Buffett takes interest in companies trading below what he believes is their intrinsic value. He aims long-term outperformance and apparently ignores short-term downturns.
Probably this is why this investment veteran recently picked up some airlines stocks that are currently overlooked by investors. The sector is in the bottom 39% of the Zacks Industry Rank at the time of this writing (read: If Oil Continues to Soar, These 7 ETFs May Fall ).
The stocks that Buffett bought are American Airlines AAL , Delta Airlines DAL and United Continental Holdings Inc. UAL . As per sources, Buffett also bought Southwest Airlines Co . LUV recently.
Why Buffett Catches Airlines?
This shows a tectonic shift in preference as Buffet has stayed away from airline stocks for long. But the latest surge in interest can be credited to a decent level of share buybacks by airlines, as per Market Watch . The industry's profitability and efficiency ratios have also improved in recent times, barring some exceptions.
In the latest reporting cycle too, the beat ratios show that the corporate strength in the airlines industry is not as bleak as the stock trend. Plus, most of the airlines are restraining capacity growth , which should improve unit revenues (read: Brexit or Earnings: What Will Decide the Route Map for Airline ETF? ).
Investors should also note that UAL, AAL and DAL carry a Zacks Rank #3 (Hold) each with a VGM score of A, which is a combination of value, growth and momentum characteristics. The trio especially has a Value score of 'A' . Though LUV is not in our favored list with a Zacks Rank #5 (Strong Sell), it still has a VGM score of B with the same value score. Since Buffet is a fan of value investing, his sudden interest in airline stocks is self-explanatory.
Below we elucidate how cheap these four stocks are compared to the air transportation industry and the S&P 500 using various valuation metrics:
If these were not enough, airlines expect a 2.5% surge in travelers in the thanksgiving weekend and accordingly beefed up the number of flights and seats. All in all, investors intending to follow Buffett's latest move on airlines stocks and having faith in the industry fundamentals may find U.S. Global Jets ETFJETS an intriguing choice (see all industrial ETFs here ).
JETS in Focus
The $49.7 million-fund holds over 34 stocks in its portfolio and is concentrated on a few individual securities. United Continental (13.26%), Delta Airlines (13.11%), Southwest Airlines (12.78%) and American Airlines (12.61%) are the top four elements in the basket. The product charges 60 bps in fees. The fund gained about 5.2% in the last five trading sessions (as of November 17, 2016).
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SOUTHWEST AIR (LUV): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Investors should also note that UAL, AAL and DAL carry a Zacks Rank #3 (Hold) each with a VGM score of A, which is a combination of value, growth and momentum characteristics. The stocks that Buffett bought are American Airlines AAL , Delta Airlines DAL and United Continental Holdings Inc. UAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here.
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The stocks that Buffett bought are American Airlines AAL , Delta Airlines DAL and United Continental Holdings Inc. UAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Investors should also note that UAL, AAL and DAL carry a Zacks Rank #3 (Hold) each with a VGM score of A, which is a combination of value, growth and momentum characteristics.
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The stocks that Buffett bought are American Airlines AAL , Delta Airlines DAL and United Continental Holdings Inc. UAL . Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Investors should also note that UAL, AAL and DAL carry a Zacks Rank #3 (Hold) each with a VGM score of A, which is a combination of value, growth and momentum characteristics.
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The stocks that Buffett bought are American Airlines AAL , Delta Airlines DAL and United Continental Holdings Inc. UAL . Investors should also note that UAL, AAL and DAL carry a Zacks Rank #3 (Hold) each with a VGM score of A, which is a combination of value, growth and momentum characteristics. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here.
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7747.0
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2016-11-18 00:00:00 UTC
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The Zacks Analyst Blog Highlights: American Airlines Group, United Continental Holdings, Alaska Air Group, SkyWest and JetBlue Airways
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-american-airlines-group-united-continental-holdings
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For Immediate Release
Chicago, IL - November 18, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include American Airlines Group (NASDAQ: AAL - Free Report ), United Continental Holdings Inc. (NYSE: UAL - Free Report ), Alaska Air Group (NYSE: ALK - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and JetBlue Airways (NASDAQ: JBLU - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Thursday's Analyst Blog:
Warren Buffett Bets on 4 U.S. Airline Carriers - Should You?
The tide seems to be turning for the airlines sector as Warren Buffett's Berkshire Hathaway recently bought stakes in four major U.S. carriers - American Airlines Group (NASDAQ: AAL - Free Report ) and United Continental Holdings Inc. (NYSE: UAL - Free Report ). The move naturally found favor with investors since Buffett, the founder and CEO of Berkshire Hathaway, is commonly regarded as one of the greatest (if not the greatest) investors of all time.
According to the Omaha, NE-based company's third quarter 13-F filing, Buffet has invested in Delta Air Lines, American Airlines and United Continental. The fact that the iconic investor has also betted on low-cost carrier Southwest Airlines was revealed via a CNBC report .
Unexpected Move
The move has come as a complete surprise since Buffett historically did not favor airline stocks. According to media reports, his last involvement with the airlines sector was way back in the 1980s when he invested in U.S. Airways. The experience was anything but sweet and consequently Buffet turned his back on airlines.
He was so disgruntled with the sector that he once said that "it has eaten up capital over the past century like almost no other business." No doubt his move to buy stakes in major U.S. airline stocks was completely unexpected and consequently has attracted a lot of attention.
The move is all the more surprising since it comes at a time when carriers are facing multiple headwinds like declining air fare, low demand for travel due to security fears, technological problems and Brexit-induced uncertainty to name a few.
Recent Tailwinds
Despite being plagued by headwinds, the third quarter (which recently concluded for airline stocks) did see quite a few airline players including the four in which Buffett has put his money on, reporting better-than-expected earnings per share - though undoubtedly aided by low expectations.
In fact, carriers like United Continental Holdings, American Airlines, Alaska Air Group (NYSE: ALK - Free Report ) and SkyWest, Inc. (NASDAQ: SKYW - Free Report ) , have not only topped earnings expectations but have also outperformed in terms of revenues. In fact, SkyWest's Zacks Rank #1 (Strong Buy) bears evidence of the improving condition. You can see the complete list of today's Zacks #1 Rank stocks here . The better-than-expected third-quarter performance can be gauged by the 9.2% gain the NYSE ARCA Airline Index over the last one month.
Industry Price Index
Moreover, woes related to unit revenues that have hurt airline stocks for quite some time seem to be easing. American Airlines recently unveiled a bullish outlook on unit revenues for the fourth quarter of 2016. The carrier now expects total revenue per available seat mile (TRASM: a key measure of unit revenues) to decline in the band of 0.5% to 2.5% in the fourth quarter. The view represents a marked improvement from the guidance issued last month when the metric was expected to decline in the band of 1-3%.
Delta expects to return to positive unit revenue growth early next year. Moreover, RASM at JetBlue Airways (NASDAQ: JBLU - Free Report ) decreased 3.5% in the third quarter. This indicates an improvement from the 8.2% decline in the second quarter.
Also, fears related to overcapacity have been plaguing airline investors for quite some time. However, the bullish capacity-related updates recently provided by several carriers are putting to rest such fears. In September, Southwest Airlines announced that it expects 2017 capacity to expand less than 4% on a year-over-year basis.
The projection compares favorably with the view for 2016, wherein capacity is estimated to increase in the range of 5% to 6%. Furthermore, while releasing its third-quarter results, Delta said that it expects 2017 capacity to expand merely 1%, in line with the projection for the fourth quarter.
Moreover, the current scenario of rising oil prices could turn out to be favorable for airlines. This is because carriers are likely to hike air fares in such a scenario. This will ultimately augment the top line.
Additionally, the approval granted by the U.S. Transportation Department to eight U.S. carriers, including the four favored by Buffett, is a positive. Once operational, the top line of the concerned carriers should be boosted significantly as Havana is a favorite tourist spot.
The improving scenario for the airline industry can be further gauged by fact that the current Zacks Industry Rank of 161 (among more than 260 groups) for the Transportation-Airline division is much more favorable than the 200+ rank carried a month ago.
Given the recent improvements, the involvement of one of the most revered investors of all times will undoubtedly usher in better days for the sector. While we expect these developments to rekindle the interest of investors in the aviation space, the picture will become clearer only with the passage of time.
See our relevant video article here .
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Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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AMER AIRLINES (AAL): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
SKYWEST INC (SKYW): Free Stock Analysis Report
ALASKA AIR GRP (ALK): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include American Airlines Group (NASDAQ: AAL - Free Report ), United Continental Holdings Inc. (NYSE: UAL - Free Report ), Alaska Air Group (NYSE: ALK - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and JetBlue Airways (NASDAQ: JBLU - Free Report ). The tide seems to be turning for the airlines sector as Warren Buffett's Berkshire Hathaway recently bought stakes in four major U.S. carriers - American Airlines Group (NASDAQ: AAL - Free Report ) and United Continental Holdings Inc. (NYSE: UAL - Free Report ). Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on ALK - FREE Get the full Report on JBLU - FREE Get the full Report on SKYW - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include American Airlines Group (NASDAQ: AAL - Free Report ), United Continental Holdings Inc. (NYSE: UAL - Free Report ), Alaska Air Group (NYSE: ALK - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and JetBlue Airways (NASDAQ: JBLU - Free Report ). The tide seems to be turning for the airlines sector as Warren Buffett's Berkshire Hathaway recently bought stakes in four major U.S. carriers - American Airlines Group (NASDAQ: AAL - Free Report ) and United Continental Holdings Inc. (NYSE: UAL - Free Report ). Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report To read this article on Zacks.com click here.
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Stocks recently featured in the blog include American Airlines Group (NASDAQ: AAL - Free Report ), United Continental Holdings Inc. (NYSE: UAL - Free Report ), Alaska Air Group (NYSE: ALK - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and JetBlue Airways (NASDAQ: JBLU - Free Report ). Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on ALK - FREE Get the full Report on JBLU - FREE Get the full Report on SKYW - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report To read this article on Zacks.com click here.
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The tide seems to be turning for the airlines sector as Warren Buffett's Berkshire Hathaway recently bought stakes in four major U.S. carriers - American Airlines Group (NASDAQ: AAL - Free Report ) and United Continental Holdings Inc. (NYSE: UAL - Free Report ). Stocks recently featured in the blog include American Airlines Group (NASDAQ: AAL - Free Report ), United Continental Holdings Inc. (NYSE: UAL - Free Report ), Alaska Air Group (NYSE: ALK - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and JetBlue Airways (NASDAQ: JBLU - Free Report ). Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on ALK - FREE Get the full Report on JBLU - FREE Get the full Report on SKYW - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7748.0
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2016-11-16 00:00:00 UTC
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Buffett's Big New Buys Are Soaring
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AAL
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https://www.nasdaq.com/articles/buffetts-big-new-buys-are-soaring-2016-11-16
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nan
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nan
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Warren Buffett is arguably the best investor of our generation, and while Buffett openly admits to having made mistakes in the past, tracking the stocks he's buying can be a great way to discover compelling new ideas for your own portfolio. With that in mind, a review of Berkshire Hathaway 's(NYSE: BRK-B) (NYSE: BRK-A) third-quarter 13-F filing shows that Berkshire bought shares in three of the country's biggest airlines: American Airlines Group (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , and United Continental Holdings (NYSE: UAL) . CNBC reports that Berkshire Hathaway also bought shares in discount carrier Southwest Airlines (NYSE: LUV) last quarter.
So far, cozying up to airlines last quarter is paying off. On average, these four stocks have rallied an impressive 21.6% since Sept. 30. Can airline stocks continue to climb? Read on to find out why these stocks have been added to Berkshire Hathaway's $132 billion portfolio, and to see if they might be worth adding to yours, too.
DAL Operating Margin (TTM) data by YCharts .
The industry's improving profitability is even more enticing given that airline stocks continue to trade at some of the lowest P/E ratios in the stock market. The trailing P/E ratio of all four of these stocks is in the low double or high single digits. Considering that the trailing P/E ratio on the S&P 500 is about 25, an argument can be made that airlines aren't outlandishly expensive.
DAL PE Ratio (TTM) data by YCharts .
Looking up
In the third quarter, airlines reported flat to lower revenue, but streamlined business operations still allowed them to make money. At American Airlines, $10.6 billion in revenue translated into net profit of $737 million. Delta Air's $10.5 billion in revenue translated into adjusted net income of $1.26 billion. And United Continental's $9.9 billion in revenue translated into adjusted net income of $997 million. Southwest's sales of $5.14 billion resulted in adjusted net income of $582 million.
In the future, airline stock performance will depend on passenger counts and fuel prices; the latter represent about 20% to 30% of the industry's costs, depending on the year. Fortunately, both of those inputs could have tailwinds.
The number of airline passengers worldwide will almost double to 7.2 billion people by 2035, up a compounded 3.7% annually, according to theInternational Air Transport Association (IATA) . Growth will be best in developing markets, but North America is still expected to increase by 2.8% per year over the period.
Jet fuel prices could continue to have a positive impact on profitability, too. Currently, jet fuel is about 5.5% cheaper than it was a year ago, and that has the IATA estimating that lower jet fuel prices will save the industry $21 billion this year. Longer-term, President-elect Donald Trump's campaign promise to open up access to federal lands for oil exploration could help keep jet fuel prices in check.
Overall, it's anyone's guess whether or not airlines have truly overcome their past struggles, making this industry worth investing in for the long term. Berkshire Hathaway is willing to bet a little of its money that better times are ahead, but investors may want to keep Berkshire's bet in perspective. Assuming the company's Southwest stake is similar to those in Delta and United Continental, airlines represent only about 1.8% of Berkshire's equity portfolio.
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Todd Campbell has no position in any stocks mentioned. Todd owns E.B. Capital Markets, LLC. E.B. Capital's clients may have positions in the companies mentioned.Like this article? Follow him on Twitter where he goes by the handle @ebcapitalto see more articles like this .
The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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With that in mind, a review of Berkshire Hathaway 's(NYSE: BRK-B) (NYSE: BRK-A) third-quarter 13-F filing shows that Berkshire bought shares in three of the country's biggest airlines: American Airlines Group (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , and United Continental Holdings (NYSE: UAL) . The number of airline passengers worldwide will almost double to 7.2 billion people by 2035, up a compounded 3.7% annually, according to theInternational Air Transport Association (IATA) . Longer-term, President-elect Donald Trump's campaign promise to open up access to federal lands for oil exploration could help keep jet fuel prices in check.
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With that in mind, a review of Berkshire Hathaway 's(NYSE: BRK-B) (NYSE: BRK-A) third-quarter 13-F filing shows that Berkshire bought shares in three of the country's biggest airlines: American Airlines Group (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , and United Continental Holdings (NYSE: UAL) . Delta Air's $10.5 billion in revenue translated into adjusted net income of $1.26 billion. And United Continental's $9.9 billion in revenue translated into adjusted net income of $997 million.
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With that in mind, a review of Berkshire Hathaway 's(NYSE: BRK-B) (NYSE: BRK-A) third-quarter 13-F filing shows that Berkshire bought shares in three of the country's biggest airlines: American Airlines Group (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , and United Continental Holdings (NYSE: UAL) . The industry's improving profitability is even more enticing given that airline stocks continue to trade at some of the lowest P/E ratios in the stock market. In the future, airline stock performance will depend on passenger counts and fuel prices; the latter represent about 20% to 30% of the industry's costs, depending on the year.
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With that in mind, a review of Berkshire Hathaway 's(NYSE: BRK-B) (NYSE: BRK-A) third-quarter 13-F filing shows that Berkshire bought shares in three of the country's biggest airlines: American Airlines Group (NASDAQ: AAL) , Delta Air Lines (NYSE: DAL) , and United Continental Holdings (NYSE: UAL) . The industry's improving profitability is even more enticing given that airline stocks continue to trade at some of the lowest P/E ratios in the stock market. That's right -- they think these 10 stocks are even better buys.
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7749.0
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2016-11-16 00:00:00 UTC
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Are the Airlines Really Value Stocks?
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AAL
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https://www.nasdaq.com/articles/are-airlines-really-value-stocks-2016-11-16
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nan
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Welcome to Episode #18 of the Value Investor Podcast
Every week, Zacks value stock strategist and the Editor of Zacks Value Investor portfolio service, Tracey Ryniec, talks about all things happening in the value stock universe, including her top stock picks.
It was recently revealed that Warren Buffett's Berkshire Hathaway bought shares in 4 airline stocks.
This was shocking because Buffett has railed against the airline stocks for decades. He first bought into the industry in 1989 when he invested in US Airways and it did not end well. He has been so anti-airline over the years he has called them "death traps" for investors.
But new quarterly filings show that Berkshire has bought shares in:
1. Delta Air Lines, Inc. (DAL): forward P/E of 8.5
2. United Airlines (UAL): forward P/E of 8
3. American Airlines (AAL): forward P/E of 7.9
4. Southwest Airlines Co. (LUV): forward P/E of 12.4
Are the airlines still value stocks? Should value investors be following Berkshires lead?
Tracey examined each of these to see if they are still attractive buys.
Additionally, she looked at a couple other airlines that she does like including Hawaiian Holdings (HA), which is the largest airline serving Hawaii, and Copa Holdings SA (CPA) which is based in Panama and has a niche in Central and South America's emerging middle class.
Tracey also examines why someone would need to buy FOUR airlines stocks. Why not just 1 or 2?
Find out what else Tracey thinks of Buffett's airline buy and more on this week's podcast.
Want more insights from Tracey?
Check out her weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks she thinks are the best bargains now.
Click here to learn more>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
SOUTHWEST AIR (LUV): Free Stock Analysis Report
DELTA AIR LINES (DAL): Free Stock Analysis Report
HAWAIIAN HLDGS (HA): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (AAL): forward P/E of 7.9 4. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. It was recently revealed that Warren Buffett's Berkshire Hathaway bought shares in 4 airline stocks.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines (AAL): forward P/E of 7.9 4. Delta Air Lines, Inc. (DAL): forward P/E of 8.5 2.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines (AAL): forward P/E of 7.9 4. Welcome to Episode #18 of the Value Investor Podcast Every week, Zacks value stock strategist and the Editor of Zacks Value Investor portfolio service, Tracey Ryniec, talks about all things happening in the value stock universe, including her top stock picks.
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American Airlines (AAL): forward P/E of 7.9 4. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report DELTA AIR LINES (DAL): Free Stock Analysis Report HAWAIIAN HLDGS (HA): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Southwest Airlines Co. (LUV): forward P/E of 12.4 Are the airlines still value stocks?
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7750.0
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2016-11-15 00:00:00 UTC
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Stock Futures Buoyed By Oil, Strong Consumer Spending
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AAL
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https://www.nasdaq.com/articles/stock-futures-buoyed-oil-strong-consumer-spending-2016-11-15
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nan
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Stock futures added slightly to their earlier gains on signs that consumer spending remains robust and that the manufacturing sector is improving, pointing to a seventh consecutive gain for the Dow Jones Industrial Average.
Shares were also getting a lift from a sizable gain in oil futures as members of the Organization for Petroleum Exporting Countries try to close the rift between Iran and Iraq. West Texas intermediate crude oil futures were more than 3% higher, matching a gain in Brent crude oil futures.
October retail sales beat Wall Street expectations with a solid gain of 0.8%, while September was revised sharply higher to +1.0% from +0.6%.
Excluding automobiles, sales were up 0.8%, and rose 0.6% excluding the sale of both autos and gas, twice the increase the market was expecting. September was revised higher as well.
Additionally, the Empire State manufacturing index improved to a positive 1.5 in November from negative 6.8, beating expectations for a gain to just negative 2.3.
Lastly, import prices were up 0.5% last month while export prices rose 0.2%, both beating estimates for a gain of 0.4% and 0.1%, respectively.
In other news, airline stocks were rallying ahead of Tuesday's open in reaction to Warren Buffett's bet on the industry. According to the most recent 13-F filed by Berkshire Hathaway, Buffett took a sizable position in American Airlines ( AAL ), United Continental ( UAL ) and Delta Airlines ( DAL ), all of which were trading 3% to 4% higher in Tuesday's pre-market.
Coming up next is September business inventories, projected to increase 0.2%.
-Dow Jones Industrial up 0.06%
-S&P 500 futures up 0.20%
-Nasdaq 100 futures up 0.47%
SENTIMENT
Nikkei down 0.03%
Hang Seng up 0.46%
Shanghai Composite down 0.11%
FTSE-100 up 0.49%
DAX-30 up 0.01%
PRE-MARKET SECTOR WATCH
(+) Large cap tech: Higher
(+/-) Chip stocks: Flat
(+) Software stocks: Higher
(+) Hardware stocks: Higher
(+) Internet stocks: Higher
(+) Oil stocks: Higher
(+/-) Biotech stocks: Mixed
(+) Drug stocks: Higher
(-) Financial stocks: Lower
(+/-) Retail stocks: Mixed
(+/-) Industrial stocks: Mixed
(+) Airlines: Higher
(+) Autos: Higher
UPSIDE MOVERS:
(+) AAP (+14.84%) Q3 results beat Wall Street expectations
(+) RPRX (+9.04%) Reported topline clinical results for Proellex
(+) AAL (+4.26%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL )
DOWNSIDE MOVERS:
(-) BETR (-21.68%) Q3 earnings misses expectations, revenue beats, raises FY16 revenue guidance in-line with street estimates
(-) SSYS (-10.88%) Missed Q3 expectations, lowered FY16 guidance below street projections
(-) TSRO (-10.27%) Announced 1.75 million share offering
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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According to the most recent 13-F filed by Berkshire Hathaway, Buffett took a sizable position in American Airlines ( AAL ), United Continental ( UAL ) and Delta Airlines ( DAL ), all of which were trading 3% to 4% higher in Tuesday's pre-market. (+) AAP (+14.84%) Q3 results beat Wall Street expectations (+) RPRX (+9.04%) Reported topline clinical results for Proellex (+) AAL (+4.26%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) Shares were also getting a lift from a sizable gain in oil futures as members of the Organization for Petroleum Exporting Countries try to close the rift between Iran and Iraq.
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According to the most recent 13-F filed by Berkshire Hathaway, Buffett took a sizable position in American Airlines ( AAL ), United Continental ( UAL ) and Delta Airlines ( DAL ), all of which were trading 3% to 4% higher in Tuesday's pre-market. (+) AAP (+14.84%) Q3 results beat Wall Street expectations (+) RPRX (+9.04%) Reported topline clinical results for Proellex (+) AAL (+4.26%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (+) Large cap tech: Higher (+/-) Chip stocks: Flat (+) Software stocks: Higher (+) Hardware stocks: Higher (+) Internet stocks: Higher (+) Oil stocks: Higher (+/-) Biotech stocks: Mixed (+) Drug stocks: Higher (-) Financial stocks: Lower (+/-) Retail stocks: Mixed (+/-) Industrial stocks: Mixed (+) Airlines: Higher (+) Autos: Higher
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According to the most recent 13-F filed by Berkshire Hathaway, Buffett took a sizable position in American Airlines ( AAL ), United Continental ( UAL ) and Delta Airlines ( DAL ), all of which were trading 3% to 4% higher in Tuesday's pre-market. (+) AAP (+14.84%) Q3 results beat Wall Street expectations (+) RPRX (+9.04%) Reported topline clinical results for Proellex (+) AAL (+4.26%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) October retail sales beat Wall Street expectations with a solid gain of 0.8%, while September was revised sharply higher to +1.0% from +0.6%.
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According to the most recent 13-F filed by Berkshire Hathaway, Buffett took a sizable position in American Airlines ( AAL ), United Continental ( UAL ) and Delta Airlines ( DAL ), all of which were trading 3% to 4% higher in Tuesday's pre-market. (+) AAP (+14.84%) Q3 results beat Wall Street expectations (+) RPRX (+9.04%) Reported topline clinical results for Proellex (+) AAL (+4.26%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) Stock futures added slightly to their earlier gains on signs that consumer spending remains robust and that the manufacturing sector is improving, pointing to a seventh consecutive gain for the Dow Jones Industrial Average.
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7751.0
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2016-11-15 00:00:00 UTC
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Berkshire Hathaway Takes Large Stakes in Airlines
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AAL
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https://www.nasdaq.com/articles/berkshire-hathaway-takes-large-stakes-airlines-2016-11-15
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nan
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nan
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Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) now owns 21.8 million shares of American Airlines ( AAL ), over 4.5 million shares of United Continental ( UAL ) and over 6.3 million shares of Delta Airlines ( DAL ).
And Berkshire also took a stake in Southwest Airlines ( LUV ), according to CNBC,
As a result of Tuesday's news, shares within the sector are higher with AAL up over 2%, UAL higher by over 2%, and LUV trading with a nearly 2% gain. DAL has since surrendered its 2.0% premarket gain to trade up just 0.4%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) now owns 21.8 million shares of American Airlines ( AAL ), over 4.5 million shares of United Continental ( UAL ) and over 6.3 million shares of Delta Airlines ( DAL ). And Berkshire also took a stake in Southwest Airlines ( LUV ), according to CNBC, As a result of Tuesday's news, shares within the sector are higher with AAL up over 2%, UAL higher by over 2%, and LUV trading with a nearly 2% gain. DAL has since surrendered its 2.0% premarket gain to trade up just 0.4%.
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Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) now owns 21.8 million shares of American Airlines ( AAL ), over 4.5 million shares of United Continental ( UAL ) and over 6.3 million shares of Delta Airlines ( DAL ). The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. And Berkshire also took a stake in Southwest Airlines ( LUV ), according to CNBC, As a result of Tuesday's news, shares within the sector are higher with AAL up over 2%, UAL higher by over 2%, and LUV trading with a nearly 2% gain.
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Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) now owns 21.8 million shares of American Airlines ( AAL ), over 4.5 million shares of United Continental ( UAL ) and over 6.3 million shares of Delta Airlines ( DAL ). And Berkshire also took a stake in Southwest Airlines ( LUV ), according to CNBC, As a result of Tuesday's news, shares within the sector are higher with AAL up over 2%, UAL higher by over 2%, and LUV trading with a nearly 2% gain. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And Berkshire also took a stake in Southwest Airlines ( LUV ), according to CNBC, As a result of Tuesday's news, shares within the sector are higher with AAL up over 2%, UAL higher by over 2%, and LUV trading with a nearly 2% gain. Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) now owns 21.8 million shares of American Airlines ( AAL ), over 4.5 million shares of United Continental ( UAL ) and over 6.3 million shares of Delta Airlines ( DAL ). The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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7752.0
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2016-11-15 00:00:00 UTC
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Did Buffett Buy American Airlines Group Inc (AAL) Stock? Not Exactly.
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AAL
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https://www.nasdaq.com/articles/did-buffett-buy-american-airlines-group-inc-aal-stock-not-exactly.-2016-11-15
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nan
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InvestorPlaceInvestorPlace - Stock Market News, Stock Advice & Trading Tips
Warren Buffett has long hated two things: gold, and airline stocks. The Oracle of Omaha has described the airline industry as a "death trap," "capital destructor" and other similar phrases of horror. And he's been pretty right … which is why his recent 21.8 million-share purchase of American Airlines Group Inc (NASDAQ: AAPL ) and its airline brethren have a few people scratching their heads.
Source: Oliver Holzbauer via Flickr
Realistically, Berkshire's purchase of AAL stock and others was likely done by one of Buffett's lieutenants in their insurance portfolios. But it still marks a sharp shift in Berkshire Hathaway Inc.'s (NYSE: BRK.A , NYSE: BRK.B ) overall strategy.
Or does it?
As weird as it seem, AAL and the other airline stocks actually fit the bill pretty well. At the very least, they might be a sign that Berkshire Hathaway's portfolio might just be in good hands after all.
Berkshire Dives Into Airlines
This isn't the first time that Warren Buffett and Berkshire Hathaway have owned airline stocks. Buffett held around $350 million in US Airways' preferred stock back in the late 1980s.
10 Best Cheap Stocks to Buy Now Under $10
Of course, those shares' value cratered nearly instantly, and by the mid-1990's, Berkshire had written the value down to just pennies on the dollar. Buffett had broken his own rule about never losing money. And since that time, airline stocks have been strictly verboten at Berkshire.
But as Bob Dylan likes to say, "The times, they are a-changin'."
In an SEC filing on Monday , Berkshire Hathaway mentioned that it bought shares in the four biggest U.S. airlines - AAL stock, Delta Air Lines, Inc. (NYSE: DAL ), Southwest Airlines Co (NYSE: LUV ) and United Continental Holdings Inc (NYSE: UAL ). And these weren't necessarily small stakes, either. Buffett now owns a stake in AAL worth nearly $800 million, while each of the share counts for the other airlines number in the millions and are worth around $250 million each.
You're looking at about $1.5 billion to $2 billion in total worth of airline shares tucked away inside Berkshire's portfolio. And while that may not seem like much considering the massive size of Buffett's empire, it is important when you think about Buffett's overall disdain for the sector.
The man once said that "He would have done his successors a huge favor by shooting Orville down" in Kitty Hawk.
The fact that Buffett even let his lieutenants think about buying airline stocks, let alone pull the trigger, is astounding.
And smart.
AAL Stock Is a Very Shrewd Call
The thing is, Buffett's stock picking successors may actually be on to something.
Airline stocks aren't necessarily death traps anymore, and you can thank low oil prices for that. High oil prices - and the high costs related to jet fuel that come with them - have been a thorn in the side of AAL and other airline stocks for decades. Fuel costs are the industry's biggest expense, and are one of the biggest limitations to profitability.
That started to change in 2014.
As oil's glut has persisted and prices have traded in a tight range, airlines have gotten a break. Meanwhile, various fees to combat higher oil prices haven't gone away. Consumers still are paying for checked baggage and extra pillows on flights. So now, airline stocks like AAL and LUV are realizing some of their best profit margins ever. That's a complete 180 in just two years.
In fact, things are so good, many of the airline stocks have been able to pay and/or lift dividends - and meaningful ones at that.
If you think about it, airline stocks actually fit into Buffett's narrative of "lower for longer oil prices" and buying those firms that will benefit from the trend. Just like refiner Phillips 66 (NYSE: PSX ), the airline stocks should be able to feast on lower oil prices. They're not as "safe" as PSX, of course, but they still benefit via higher cash flows.
Buffett Bails on Wal-Mart Stores, Inc. (WMT) Stock. Should You?
So, Buffett's lieutenants may have set up Berkshire to start reaping those cash flows for a long time.
Should You Follow Buffett's Lead Into AAL?
The real question for you is whether Buffett's call on AAL and other airlines is right for you.
I'm inclined to say "yes," with an asterisk.
Buffett's buys came over the last three months. At the time, airline stocks still were pretty cheap, and election drama made them cheaper. Today, they can be had for roughly 20 times earnings - not exactly super-cheap. Though nothing really is today.
Given the possibility for failure and risk associated with the sector, that may be a little too rich for investors looking to snag some real dividend growth. And it could example why Buffett may have put the brakes on additional purchases.
But if investors get a chance due to a market dip to snag AAL stock and its rivals, it might be worth taking that shot.
More From InvestorPlace
The 7 Best Dividend Stocks to Buy for 2017
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Apple Inc. (AAPL) Could Launch Apple Glasses by 2018
The post Did Buffett Buy American Airlines Group Inc (AAL) Stock? Not Exactly. appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Source: Oliver Holzbauer via Flickr Realistically, Berkshire's purchase of AAL stock and others was likely done by one of Buffett's lieutenants in their insurance portfolios. But if investors get a chance due to a market dip to snag AAL stock and its rivals, it might be worth taking that shot. As weird as it seem, AAL and the other airline stocks actually fit the bill pretty well.
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More From InvestorPlace The 7 Best Dividend Stocks to Buy for 2017 7 Mutual Funds That Should Be Banished From Your Portfolio Apple Inc. (AAPL) Could Launch Apple Glasses by 2018 The post Did Buffett Buy American Airlines Group Inc (AAL) Stock? Source: Oliver Holzbauer via Flickr Realistically, Berkshire's purchase of AAL stock and others was likely done by one of Buffett's lieutenants in their insurance portfolios. As weird as it seem, AAL and the other airline stocks actually fit the bill pretty well.
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More From InvestorPlace The 7 Best Dividend Stocks to Buy for 2017 7 Mutual Funds That Should Be Banished From Your Portfolio Apple Inc. (AAPL) Could Launch Apple Glasses by 2018 The post Did Buffett Buy American Airlines Group Inc (AAL) Stock? Source: Oliver Holzbauer via Flickr Realistically, Berkshire's purchase of AAL stock and others was likely done by one of Buffett's lieutenants in their insurance portfolios. As weird as it seem, AAL and the other airline stocks actually fit the bill pretty well.
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Source: Oliver Holzbauer via Flickr Realistically, Berkshire's purchase of AAL stock and others was likely done by one of Buffett's lieutenants in their insurance portfolios. As weird as it seem, AAL and the other airline stocks actually fit the bill pretty well. In an SEC filing on Monday , Berkshire Hathaway mentioned that it bought shares in the four biggest U.S. airlines - AAL stock, Delta Air Lines, Inc. (NYSE: DAL ), Southwest Airlines Co (NYSE: LUV ) and United Continental Holdings Inc (NYSE: UAL ).
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7753.0
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2016-11-15 00:00:00 UTC
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Midday Update: Sectors Reverse With Banking Down on Profit-Taking, Tech Higher
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AAL
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https://www.nasdaq.com/articles/midday-update-sectors-reverse-banking-down-profit-taking-tech-higher-2016-11-15
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The major benchmark averages were treading water in paper-thin ranges Tuesday with strong gains in the tech and energy sector offsetting profit-taking in financial stocks. As a result, the Nasdaq Composite and S&P 500 were in the plus column, while the Dow Jones Industrial Average was struggling to stay positive as its six-day rally stalls.
Tuesday's data-dump generated a positive reaction in premarket trading , but could not sustain a move higher for the blue-chip index despite encouraging consumer spending data, and a significant rebound in the manufacturing sector in the New York Fed region. Additionally, import and export prices were higher, while business inventories increased another 0.1% in September and sales jumped 0.7%.
On the Fed front, Boston Fed President Eric Rosengren called a December rate hike "plausible" and that more fiscal stimulus could result in more monetary restriction, while Fed Governor Daniel Tarullo dismissed the risks of a recession, and also sees interest rate policy tied to fiscal policy.
Oil futures are higher for a second day as traders take offensive positions ahead of the Nov 30 meeting of the Organization of Petroleum Exporting Countries. OPEC is expected to orchestrate a production cut to 32.5 million barrels from 33.8 million barrels in October, and attempt to bridge the gap between rivals Iran and Iraq. Brent crude is more than 4% higher while its domestic benchmark, West Texas intermediate, is up by nearly 5% per barrel.
European markets were all higher at the close with France outperforming. UK inflation data missed expectations as October CPI rose by 0.9% in October versus +1.1% estimates. Q3 German and EU GDP were also shy of expectations, but was offset by gains in the ZEW economic indicator which jumped to 13.8 in Germany and 15.8 in the European Union.
Crude oil was up $1.99 to $45.31 per barrel. Natural gas was up $0.02 to $2.96 per 1 million BTU. Gold was up $1.90 to $1,223.60 an ounce, while silver was up $0.17 to $17.06 an ounce. Copper was down $0.03 to $2.50 per pound.
Among energy ETFs, the United States Oil Fund was up 3.45% to $10.21 with the United States Natural Gas Fund was up 1.44% to $7.48. Among precious-metal funds, the Market Vectors Gold Miners ETF was up 2.41% to 21.65 while SPDR Gold Shares were up 0.49% to $116.68. The iShares Silver Trust was up 1.06% to $16.17.
Here's where the markets stand at mid-day:
US MARKETS
NYSE Composite Index was up 6.06 points (+0.06%) to 10,685.47
Dow Jones Industrial Index was down 30.20 points (-0.16%) to 18,837.94
S&P 500 was up 7.42 points (+0.34%) to 2,171.74
Nasdaq Composite Index was up 43.19 points (+0.83%) to 5,261.70
GLOBAL SENTIMENT
FTSE 100 was up 39.56 points (+0.59%) to 6,792.74
DAX was up 41.45 points (+0.39%) to 10,735.14
CAC 40 was up 27.98 points (+0.62%) to 4.536.53
Nikkei 225 was down 4.47 points (-0.03%) to 17,668.15
Hang Seng Index was up 101.69 points (+0.46%) to 22,323.91
Shanghai China Composite Index was down 3.39 points (-0.11%) to 3,206.99
NYSE SECTOR INDICES
NYSE Energy Sector Index was up 252.04 points (+2.39%) to 10,773.06
NYSE Financial Sector Index was down 43.10 points (-0.65%) to 6,634.57
NYSE Healthcare Sector Index was down 20.23 points (-0.17%) to 11,907.28
UPSIDE MOVERS
(+) AAP (+15.89%) Q3 results beat Wall Street expectations
(+) AAL (+3.18%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL )
(+) OCUL (+1.89%) RBC raises price target to $32 from $30, maintain outperform rating
DOWNSIDE MOVERS
(-) SYN (-39.17%) Prices $25 million stock offering at $1 per share
(-) BETR (-23.98%) Q3 earnings misses expectations, revenue beats, raises FY16 revenue guidance in-line with street estimates
(-) SSYS (-16.59%) Missed Q3 expectations, lowered FY16 guidance below street projections
(-) TSRO (-13.29%) Announced 1.75 million share offering
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(+) AAP (+15.89%) Q3 results beat Wall Street expectations (+) AAL (+3.18%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (+) OCUL (+1.89%) RBC raises price target to $32 from $30, maintain outperform rating The major benchmark averages were treading water in paper-thin ranges Tuesday with strong gains in the tech and energy sector offsetting profit-taking in financial stocks. Tuesday's data-dump generated a positive reaction in premarket trading , but could not sustain a move higher for the blue-chip index despite encouraging consumer spending data, and a significant rebound in the manufacturing sector in the New York Fed region.
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(+) AAP (+15.89%) Q3 results beat Wall Street expectations (+) AAL (+3.18%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (+) OCUL (+1.89%) RBC raises price target to $32 from $30, maintain outperform rating NYSE Composite Index was up 6.06 points (+0.06%) to 10,685.47 Dow Jones Industrial Index was down 30.20 points (-0.16%) to 18,837.94 S&P 500 was up 7.42 points (+0.34%) to 2,171.74 Nasdaq Composite Index was up 43.19 points (+0.83%) to 5,261.70 NYSE Energy Sector Index was up 252.04 points (+2.39%) to 10,773.06 NYSE Financial Sector Index was down 43.10 points (-0.65%) to 6,634.57 NYSE Healthcare Sector Index was down 20.23 points (-0.17%) to 11,907.28
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(+) AAP (+15.89%) Q3 results beat Wall Street expectations (+) AAL (+3.18%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (+) OCUL (+1.89%) RBC raises price target to $32 from $30, maintain outperform rating NYSE Composite Index was up 6.06 points (+0.06%) to 10,685.47 Dow Jones Industrial Index was down 30.20 points (-0.16%) to 18,837.94 S&P 500 was up 7.42 points (+0.34%) to 2,171.74 Nasdaq Composite Index was up 43.19 points (+0.83%) to 5,261.70 NYSE Energy Sector Index was up 252.04 points (+2.39%) to 10,773.06 NYSE Financial Sector Index was down 43.10 points (-0.65%) to 6,634.57 NYSE Healthcare Sector Index was down 20.23 points (-0.17%) to 11,907.28
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(+) AAP (+15.89%) Q3 results beat Wall Street expectations (+) AAL (+3.18%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (+) OCUL (+1.89%) RBC raises price target to $32 from $30, maintain outperform rating OPEC is expected to orchestrate a production cut to 32.5 million barrels from 33.8 million barrels in October, and attempt to bridge the gap between rivals Iran and Iraq. NYSE Energy Sector Index was up 252.04 points (+2.39%) to 10,773.06 NYSE Financial Sector Index was down 43.10 points (-0.65%) to 6,634.57 NYSE Healthcare Sector Index was down 20.23 points (-0.17%) to 11,907.28
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7754.0
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2016-11-15 00:00:00 UTC
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Close Update: Tech and Energy Shares Boost Wall Street, Dow Flirts With Record High
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https://www.nasdaq.com/articles/close-update-tech-and-energy-shares-boost-wall-street-dow-flirts-record-high-2016-11-15
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Led by gains in the technology and energy sector, the benchmark averages all closed higher Tuesday with the Dow Jones Industrial Average erasing early losses and flirting with another record high before the close. The Nasdaq Composite outperformed on strength in big-cap tech stocks like Amazon ( AMZN ), Facebook ( FB ) and Alphabet (GOOG, GOOGL), all of which snapped a four day losing streak, and drove the tech index back over its 50-day moving average.
Stocks were treading water at the open with the Dow poised to snap a six-day winning streak on heavy profit-taking losses in the financial sector. Upbeat economic data that included bullish retail sales and the Empire State manufacturing index did not generate much interest, causing the Dow to drift into the red at the open, while the S&P 500 and Nasdaq were buoyed by gains in the tech and energy sector.
Oil futures were as much as 4% higher on expectations that the Organization of Petroleum Exporting Countries will coordinate production cuts at the Nov 30 meeting and mend a rift between Iran and Iraq. Brent crude futures set a nine-day high, gaining as much as $2.36 per barrel from Monday's close.
In corporate news, airline stocks got a substantial boost from a regulatory filing from Berkshire Hathaway (BRK.A/B) indicating the company took a sizable stake in American Airlines ( AAL ), United Continental ( UAL ), Delta Airlines ( DAL ) and Southwest Airlines (LUV). As a result, the Dow Transportation index hit its highest level since April 2015.
Looking ahead, Wednesday's calendar includes the producer price index, industrial production and capacity utilization, the Atlanta Fed business inflation expectations, and the housing market index.
Here's where the markets stood at the close:
US MARKETS
Dow Jones Industrial Index was up 0.29%
S&P 500 was up 0.75%
Nasdaq Composite Index was up 1.1%
GLOBAL SENTIMENT
FTSE 100 was up 0.59%
Nikkei 225 was down 0.03%
Hang Seng Index was up 0.46%
Shanghai China Composite Index was down 0.11%
UPSIDE MOVERS
(+) ESEA (+99.12%) Shipping stocks including SHIP (+74.55%) DCIX (+154.77%) and DRYS (+70.32%) buoyed by outcome to U.S. presidential election, Korea Line Corp awarded Hanjin shipping assets in bankruptcy court
(+) AAP (+15.00%) Q3 results beat Wall Street expectations
(+) AAL (+3.13%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL )
DOWNSIDE MOVERS:
(-) SYN (-37.76%) Prices $25 million stock offering at $1 per share
(-) BETR (-24.35%) Q3 earnings misses expectations, revenue beats, raises FY16 revenue guidance in-line with street estimates
(-) SSYS (-12.44%) Missed Q3 expectations, lowered FY16 guidance below street projections
(-) TSRO (-11.76%) Announced 1.75 million share offering
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In corporate news, airline stocks got a substantial boost from a regulatory filing from Berkshire Hathaway (BRK.A/B) indicating the company took a sizable stake in American Airlines ( AAL ), United Continental ( UAL ), Delta Airlines ( DAL ) and Southwest Airlines (LUV). (+) ESEA (+99.12%) Shipping stocks including SHIP (+74.55%) DCIX (+154.77%) and DRYS (+70.32%) buoyed by outcome to U.S. presidential election, Korea Line Corp awarded Hanjin shipping assets in bankruptcy court (+) AAP (+15.00%) Q3 results beat Wall Street expectations (+) AAL (+3.13%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) Upbeat economic data that included bullish retail sales and the Empire State manufacturing index did not generate much interest, causing the Dow to drift into the red at the open, while the S&P 500 and Nasdaq were buoyed by gains in the tech and energy sector.
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In corporate news, airline stocks got a substantial boost from a regulatory filing from Berkshire Hathaway (BRK.A/B) indicating the company took a sizable stake in American Airlines ( AAL ), United Continental ( UAL ), Delta Airlines ( DAL ) and Southwest Airlines (LUV). (+) ESEA (+99.12%) Shipping stocks including SHIP (+74.55%) DCIX (+154.77%) and DRYS (+70.32%) buoyed by outcome to U.S. presidential election, Korea Line Corp awarded Hanjin shipping assets in bankruptcy court (+) AAP (+15.00%) Q3 results beat Wall Street expectations (+) AAL (+3.13%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) (-) SYN (-37.76%) Prices $25 million stock offering at $1 per share (-) BETR (-24.35%) Q3 earnings misses expectations, revenue beats, raises FY16 revenue guidance in-line with street estimates (-) SSYS (-12.44%) Missed Q3 expectations, lowered FY16 guidance below street projections (-) TSRO (-11.76%) Announced 1.75 million share offering The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(+) ESEA (+99.12%) Shipping stocks including SHIP (+74.55%) DCIX (+154.77%) and DRYS (+70.32%) buoyed by outcome to U.S. presidential election, Korea Line Corp awarded Hanjin shipping assets in bankruptcy court (+) AAP (+15.00%) Q3 results beat Wall Street expectations (+) AAL (+3.13%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) In corporate news, airline stocks got a substantial boost from a regulatory filing from Berkshire Hathaway (BRK.A/B) indicating the company took a sizable stake in American Airlines ( AAL ), United Continental ( UAL ), Delta Airlines ( DAL ) and Southwest Airlines (LUV). Led by gains in the technology and energy sector, the benchmark averages all closed higher Tuesday with the Dow Jones Industrial Average erasing early losses and flirting with another record high before the close.
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In corporate news, airline stocks got a substantial boost from a regulatory filing from Berkshire Hathaway (BRK.A/B) indicating the company took a sizable stake in American Airlines ( AAL ), United Continental ( UAL ), Delta Airlines ( DAL ) and Southwest Airlines (LUV). (+) ESEA (+99.12%) Shipping stocks including SHIP (+74.55%) DCIX (+154.77%) and DRYS (+70.32%) buoyed by outcome to U.S. presidential election, Korea Line Corp awarded Hanjin shipping assets in bankruptcy court (+) AAP (+15.00%) Q3 results beat Wall Street expectations (+) AAL (+3.13%) Warren Buffett disclosed large stake in American Airlines, Delta Airlines ( DAL ) and United Continental ( UAL ) Led by gains in the technology and energy sector, the benchmark averages all closed higher Tuesday with the Dow Jones Industrial Average erasing early losses and flirting with another record high before the close.
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7755.0
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2016-11-15 00:00:00 UTC
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Warren Buffett's Berkshire Hathaway Bets Big on Airlines at the Strangest Time
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AAL
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https://www.nasdaq.com/articles/warren-buffetts-berkshire-hathaway-bets-big-airlines-strangest-time-2016-11-15
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For two decades, Warren Buffett has been decrying airlines as terrible investments. Indeed, Buffett famously observed that a far-sighted capitalist should have shot down Orville Wright's plane at Kitty Hawk to save future investors the billions of dollars they would go on to lose in the airline business.
American Airlines, Delta Air Lines, and United Continental stock performance. Data by YCharts .
However, Warren Buffett is never looking for a quick trade. (These investments were probably picked by one of his two investing lieutenants: Todd Combs and Ted Wechsler. But they both subscribe to the same general investing philosophy as Buffett.) Thus, the question is why these value investors now expect strong long-term gains from airline stocks.
In Berkshire Hathaway's 2007 shareholder letter, Buffett wrote, "The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines."
Over the past few years, American Airlines, Delta Air Lines, and United Continental have turned this logic on its head. They have increased capacity at a very modest rate, maintained double-digit pre-tax margins, and kept a lid on capital spending.
As a result, they are all producing free cash flow: especially Delta and United. All three airlines have also shown a commitment to returning cash to shareholders through buybacks, a practice that Buffett supports. These changes undoubtedly played a big role in making Berkshire Hathaway take a second look at airline stocks.
American Airlines, Delta Air Lines, and United Continental free cash flow (TTM). Data by YCharts .
Why American Airlines?
As the above chart shows, American Airlines produces much less free cash flow than Delta and United. That's because it is in the midst of an aggressive aircraft replacement program. It also has by far the weakest balance sheet of the three. And recently, it has had the lowest profit margin. Thus, American is much closer than either of its peers to the negative stereotype of airlines that Buffett painted in his 2007 Berkshire Hathaway shareholder letter.
Due to American's deteriorating fundamentals, I took advantage of the stock's rally in recent months to sell all my shares last month. Yet of Berkshire Hathaway's recent airline investments, American Airlines was the largest by a wide margin.
This is rather surprising. Of all the major airlines, Delta Air Lines seems closest to the Buffett ideal of a high-quality business. It has a solid balance sheet and produces consistent strong free cash flow. American Airlines is a much more speculative investment, and very out of character for Berkshire Hathaway.
Airline profitability may be peaking
More broadly, this is an odd time to start investing in the legacy carriers, because they are about to face severe margin pressure. For example, American Airlines and United Continental both expect to report adjusted pre-tax margins of 5%-7% this quarter. In Q4 2015, both companies earned double-digit pre-tax margins.
American Airlines expects its profit margin to fall steeply in Q4. Image source: American Airlines.
This margin pressure is likely to continue in 2017 and beyond. Airfares are finally starting to stabilize in the U.S., but the legacy carriers could face pressure on international routes from the strong dollar. To make matters worse, budget carriers are starting to crack the code on international flights, bringing new competition and undermining margins on long-haul routes.
At the same time, American Airlines, Delta Air Lines, and United Continental face surging labor costs. The industry's steady profitability in recent years has emboldened airline labor unions to demand big pay raises to make up for the sacrifices they made in the decade after 9/11. Lastly, oil prices could start rising in the coming years.
This rally could fade
Airlines certainly aren't the worst-looking stocks in the market today. Even after the huge rally of the past several months, shares of all three legacy carriers still trade at reasonable valuations.
That said, they don't look like screaming buys. Not only did I dump my American Airlines stock in October, but I also began to sell some of my United Continental shares last week. If the stocks continue to rise in the next few weeks, I may pare back my airline exposure even further.
Smaller airlines like JetBlue Airways and Alaska Air seem like better investment opportunities right now. These companies trade at similar earnings multiples to their legacy carrier peers. Yet they have higher profit margins and much greater growth opportunities, giving them far more long-term upside.
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Adam Levine-Weinberg owns shares of Alaska Air Group, JetBlue Airways, and United Continental Holdings and is long January 2017 $17 calls on JetBlue Airways and long January 2017 $40 calls on Delta Air Lines. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares). Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Indeed, Buffett famously observed that a far-sighted capitalist should have shot down Orville Wright's plane at Kitty Hawk to save future investors the billions of dollars they would go on to lose in the airline business. In Berkshire Hathaway's 2007 shareholder letter, Buffett wrote, "The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. The industry's steady profitability in recent years has emboldened airline labor unions to demand big pay raises to make up for the sacrifices they made in the decade after 9/11.
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American Airlines, Delta Air Lines, and United Continental free cash flow (TTM). At the same time, American Airlines, Delta Air Lines, and United Continental face surging labor costs. *Stock Advisor returns as of November 7, 2016 Adam Levine-Weinberg owns shares of Alaska Air Group, JetBlue Airways, and United Continental Holdings and is long January 2017 $17 calls on JetBlue Airways and long January 2017 $40 calls on Delta Air Lines.
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American Airlines, Delta Air Lines, and United Continental stock performance. American Airlines, Delta Air Lines, and United Continental free cash flow (TTM). Yet of Berkshire Hathaway's recent airline investments, American Airlines was the largest by a wide margin.
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Think airlines." Thus, American is much closer than either of its peers to the negative stereotype of airlines that Buffett painted in his 2007 Berkshire Hathaway shareholder letter. The Motley Fool owns shares of and recommends Berkshire Hathaway (B shares).
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2016-11-15 00:00:00 UTC
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How Did United Continental Perform Operationally In October?
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https://www.nasdaq.com/articles/how-did-united-continental-perform-operationally-october-2016-11-15-0
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United Continental's third quarter earnings remained under pressure, despite considerable fuel savings. The primary reason behind the continued weakness in the top-line is the heavy declines in passenger revenues in the Atlantic (9.7%) and Pacific (2.6%) regions. The carrier maintained capacity discipline in hopes to turnaround its unit revenues. Continuing this trend in October, capacity only grew 1.8% y-o-y. Including this month, so far in the year, capacity is up only 1.3% for United. However, the system is still plagued by some overcapacity as indicated by the 100 bps decline in the load factor. In contrast to the occupancy rate, the number of passengers onboarded increased by 2.2% y-o-y in October.
Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to continue. The expected decline is 4%-6% in the final quarter of the year, mainly due to yield weakness and timings of the holidays.
Have more questions about United Continental ( UAL )? See the links below:
United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump
United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM
How Did United Continental Perform Operationally In September?
What Is United Continental's New Fleet Plan?
Is China The New Growth Market For United Continental?
How Did United Continental Perform Operationally In August?
Why Are Airline Manufacturers Witnessing A Slowdown In Commercial Orders?
How Is United Continental Driving Cost Efficiency?
What Has Led To A 15% Fall In United's Stock Price Since The Beginning Of The Year?
What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly?
Is A Turnaround In The Cards For United Continental?
United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings
United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results
How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018?
How Will United's Equity Value Be Impacted If The Crude Oil Prices Average At $50 Per Barrel In 2018?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for United Continental
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The primary reason behind the continued weakness in the top-line is the heavy declines in passenger revenues in the Atlantic (9.7%) and Pacific (2.6%) regions. Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to continue. For precise figures, please refer to our complete analysis for United Continental View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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See the links below: United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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See the links below: United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly? United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018?
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Including this month, so far in the year, capacity is up only 1.3% for United. United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com 2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively.
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7757.0
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2016-11-15 00:00:00 UTC
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How Did United Continental Perform Operationally In October?
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AAL
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https://www.nasdaq.com/articles/how-did-united-continental-perform-operationally-october-2016-11-15
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nan
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nan
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United Continental's third quarter earnings remained under pressure, despite considerable fuel savings. The primary reason behind the continued weakness in the top-line is the heavy declines in passenger revenues in the Atlantic (9.7%) and Pacific (2.6%) regions. The carrier maintained capacity discipline in hopes to turnaround its unit revenues. Continuing this trend in October, capacity only grew 1.8% y-o-y. Including this month, so far in the year, capacity is up only 1.3% for United. However, the system is still plagued by some overcapacity as indicated by the 100 bps decline in the load factor. In contrast to the occupancy rate, the number of passengers onboarded increased by 2.2% y-o-y in October.
Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to continue. The expected decline is 4%-6% in the final quarter of the year, mainly due to yield weakness and timings of the holidays.
Have more questions about United Continental ( UAL )? See the links below:
United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump
United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM
How Did United Continental Perform Operationally In September?
What Is United Continental's New Fleet Plan?
Is China The New Growth Market For United Continental?
How Did United Continental Perform Operationally In August?
Why Are Airline Manufacturers Witnessing A Slowdown In Commercial Orders?
How Is United Continental Driving Cost Efficiency?
What Has Led To A 15% Fall In United's Stock Price Since The Beginning Of The Year?
What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly?
Is A Turnaround In The Cards For United Continental?
United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings
United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results
How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018?
How Will United's Equity Value Be Impacted If The Crude Oil Prices Average At $50 Per Barrel In 2018?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for United Continental
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The primary reason behind the continued weakness in the top-line is the heavy declines in passenger revenues in the Atlantic (9.7%) and Pacific (2.6%) regions. Going forward, the company expects the pressure on its passenger revenue average seat miles (PRASM) to continue. For precise figures, please refer to our complete analysis for United Continental View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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See the links below: United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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See the links below: United Continental Q3'16 Earnings Review: Unit Revenues Remain Under The Pump United Continental Q3'16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM How Did United Continental Perform Operationally In September? What Factors Could Likely Affect United's Unit Revenues In The Upcoming (Third) Quarterly? United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018?
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Including this month, so far in the year, capacity is up only 1.3% for United. United Witnessed A Decline In Q2'16 Earnings, Despite Substantial Fuel Cost Savings United Continental Q2'16 Earnings Preview: Higher Oil Prices & Declining PRASM To Weigh On Results How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com 2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively.
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7758.0
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2016-11-11 00:00:00 UTC
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How Did Southwest Perform Operationally In October?
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AAL
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https://www.nasdaq.com/articles/how-did-southwest-perform-operationally-october-2016-11-11
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nan
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nan
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The third quarter results for Southwest and its investors were quite disappointing, given a 3.4% y-o-y drop in revenues and a -5% decline in unit revenues. This was in part attributable to a one-time technology outage episode that ocurred in July, and in part to the continued supply-demand imbalances plaguing the industry as a whole. Further, the company expects the decline to persist, with unit revenues down 4%-5% in the final quarter of the year, due to the timings of the Christmas holiday and regional price wars. Even in such a competitive scenario, and despite being under pressure from its investors, the company has decided to not charge any baggage fee to recoup these losses. This shows how highly the company values the goodwill it has created amongst its customers.
Keeping with its guidance of 5%-6% expansion in capacity in the year, Southwest's available seat miles in the month of October 2016 were up 5.4%. Including this month, so far in the year capacity is up as much as 5.9%. The occupancy rate deteriorated slightly on an annual basis to 85.7%, but was up 40 bps for the full year. In terms of passenger traffic, the growth was 5.2%. The carrier remains hopeful to turn its revenues around in January due to impressive bookings it has received for the month and reduced capacity in 2017. However, the recently ratified labor contract will increase the company's operating costs by 3.5% in Q4'16. Consequently, we may see some adverse affect on the bottom line.
Have more questions about Southwest Airlines ( LUV )? See the links below:
Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak
Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings
How Did Southwest Airlines Perform Operationally In September?
Will International Expansion Be A Big Part Of Southwest's Future Growth Strategy?
How Did Southwest Airlines Perform Operationally In August?
What Are The Factors That Have Strengthened Southwest's Domestic Presence?
Why Are Airline Manufacturers Witnessing A Slowdown In Commercial Orders?
Has Southwest Been Able To Provide Meaningful Returns To Its Investors?
How Has Southwest's Cost Efficiency Improved?
Tracking Southwest's Capital Expenditure: How Has It Trended?
How Has Southwest Utilized Its Cash Flows?
How Will The New Labor Contract Affect Southwest?
Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share
Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018
Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Southwest Airlines
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Further, the company expects the decline to persist, with unit revenues down 4%-5% in the final quarter of the year, due to the timings of the Christmas holiday and regional price wars. The carrier remains hopeful to turn its revenues around in January due to impressive bookings it has received for the month and reduced capacity in 2017. For precise figures, please refer to our complete analysis for Southwest Airlines View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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See the links below: Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings How Did Southwest Airlines Perform Operationally In September? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things. Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The third quarter results for Southwest and its investors were quite disappointing, given a 3.4% y-o-y drop in revenues and a -5% decline in unit revenues. See the links below: Southwest Faces Market Heat As It Reports Disappointing Q3'16 Results; Future Guidance Bleak Southwest Q3'16 Earnings Preview: Labor Agreement, Rising Oil Prices To Weigh On Earnings How Did Southwest Airlines Perform Operationally In September? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things.
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The third quarter results for Southwest and its investors were quite disappointing, given a 3.4% y-o-y drop in revenues and a -5% decline in unit revenues. Will International Expansion Be A Big Part Of Southwest's Future Growth Strategy? Why Trefis Revised Southwest's Price Estimate From $46 To $38 Per Share Southwest Drops Post 2Q'16 Results As The Airline Restricts Its Capacity Growth For 2017-2018 Southwest Q2'16 Earnings Preview: Capacity Growth To Partially Offset The Impact Of Declining PRASM Notes: 1) The purpose of these analyses is to help readers focus on a few important things.
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7759.0
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2016-11-10 00:00:00 UTC
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American Airlines Group Gains on Bullish Q4 RASM View
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-gains-on-bullish-q4-rasm-view-2016-11-10
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nan
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nan
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Shares of Fort Worth, TX-based American Airlines GroupAAL gained on Nov 9, following the company's announcement of bullish fourth-quarter view for total revenue per available seat mile (TRASM: a key measure of unit revenues). The stock closed the last trading session at $42.41, up 1.7% from the previous day's closing price, following the guidance which was issued by the carrier while releasing its October traffic data.
Traffic measured in revenue passenger miles (RPMs) declined 2.6% on a year-over-year basis to 18.4 billion. The downside was primarily attributable to lackluster performances in the Atlantic and Latin American markets.
Consolidated capacity (available seat miles/ASMs) inched up 0.3% to 22.3 billion in the month. However, load factor or the percentage of seats filled by passengers decreased 260 basis points (bps) to 82.6% in Oct 2016. This was primarily because capacity expanded while traffic contracted, leading to empty planes.
In the first ten months of 2016, American Airlines recorded 0.3% growth in RPMs to 188. 5 billion, while ASMs climbed 2% to 230.1 billion, both on a year-over-year basis. Also, load factor declined 140 bps to 81.9%. Moreover, total passenger count (Enplanements) slipped 0.6% for the same period.
The carrier now expects TRASM to decline in the band of 0.5% to 2.5% in the fourth quarter. The view represents a marked improvement from the guidance issued last month when it expected the metric to decline in the band of 1% to 3%.
We note that unit revenue issues have been hurting carriers for quite some time. However, carriers have been working hard in order to return to positive unit growth after months of decline. Delta Air Lines DAL expects to return to positive unit revenue growth by early next year. United Continental Holdings UAL , on the other hand, expects passenger revenue per available seat miles (PRASM) to decline in the band of 4-6% in the fourth quarter as against the third-quarter PRASM decrease of 5.8%.
American Airlines not only provided an improved view for TRASM but the guidance for pre-tax margin excluding special items has also been raised on the basis of higher yields and the recent fall in oil prices . Pre-tax margin for the fourth quarter is now expected in the band of 5-7% compared with the prior guidance 4-6%.
AMER AIRLINES Price
AMER AIRLINES Price | AMER AIRLINES Quote
Zacks Rank & A Key Pick
Currently, American Airlines has a Zacks Rank #3 (Hold). A better-ranked transportation stock is Copa Holdings CPA , which sports a Zacks Rank #1 (Strong Buy). The 2016 Zacks Consensus Estimate has increased 12 cents to $4.67 over the last month for Copa Holdings. You can see the complete list of today's Zacks #1 Rank stocks here .
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To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of Fort Worth, TX-based American Airlines GroupAAL gained on Nov 9, following the company's announcement of bullish fourth-quarter view for total revenue per available seat mile (TRASM: a key measure of unit revenues). Click to get this free report DELTA AIR LINES (DAL): Get Free Report COPA HLDGS SA-A (CPA): Get Free Report UNITED CONT HLD (UAL): Get Free Report AMER AIRLINES (AAL): Get Free Report To read this article on Zacks.com click here. The view represents a marked improvement from the guidance issued last month when it expected the metric to decline in the band of 1% to 3%.
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Click to get this free report DELTA AIR LINES (DAL): Get Free Report COPA HLDGS SA-A (CPA): Get Free Report UNITED CONT HLD (UAL): Get Free Report AMER AIRLINES (AAL): Get Free Report To read this article on Zacks.com click here. Shares of Fort Worth, TX-based American Airlines GroupAAL gained on Nov 9, following the company's announcement of bullish fourth-quarter view for total revenue per available seat mile (TRASM: a key measure of unit revenues). Delta Air Lines DAL expects to return to positive unit revenue growth by early next year.
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Click to get this free report DELTA AIR LINES (DAL): Get Free Report COPA HLDGS SA-A (CPA): Get Free Report UNITED CONT HLD (UAL): Get Free Report AMER AIRLINES (AAL): Get Free Report To read this article on Zacks.com click here. Shares of Fort Worth, TX-based American Airlines GroupAAL gained on Nov 9, following the company's announcement of bullish fourth-quarter view for total revenue per available seat mile (TRASM: a key measure of unit revenues). United Continental Holdings UAL , on the other hand, expects passenger revenue per available seat miles (PRASM) to decline in the band of 4-6% in the fourth quarter as against the third-quarter PRASM decrease of 5.8%.
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Shares of Fort Worth, TX-based American Airlines GroupAAL gained on Nov 9, following the company's announcement of bullish fourth-quarter view for total revenue per available seat mile (TRASM: a key measure of unit revenues). Click to get this free report DELTA AIR LINES (DAL): Get Free Report COPA HLDGS SA-A (CPA): Get Free Report UNITED CONT HLD (UAL): Get Free Report AMER AIRLINES (AAL): Get Free Report To read this article on Zacks.com click here. Traffic measured in revenue passenger miles (RPMs) declined 2.6% on a year-over-year basis to 18.4 billion.
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7760.0
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2016-11-08 00:00:00 UTC
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Southwest Airlines (LUV) Pilots Approve Contract, Stock Up
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AAL
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https://www.nasdaq.com/articles/southwest-airlines-luv-pilots-approve-contract-stock-up-2016-11-08
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nan
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nan
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Shares of low-cost carrier Southwest AirlinesLUV gained 2.95% on Nov 7, to close the trading session at $41.57. The stock price appreciation was driven by the decision of the company's pilots to ratify a pay-related contract.
We remind investors that the Dallas-based carrier and the union representing its pilots, Southwest Airlines Pilots' Association ("SWAPA"), had agreed "in principle" to the terms of the contract in August. The ratification of the tentative deal concludes the negotiations which were initiated more than four years ago.
Details of the Deal
Last year, pilots of the low-cost carrier had rejected the tentative labor contract pertaining to their pay raise. Reportedly, issues related to code share agreements and "retro pay" had prompted pilots to turn down the tentative deal last year.
Following the rejection, discussions commenced once again between the two parties in accordance to the rules laid down by the National Mediation Board. The ratification of the contract will result in an immediate 15% percent pay hike for the more the 8,400 pilots covered under the deal. Moreover, the approval of the deal through Aug 2020, will allow a 3% raise to pilots, each in 2017, 2018, 2019 and 2020. The new contract also includes provisions to boost retirement funding and aims to promote job security.
The terms of the new deal are undoubtedly favorable to pilots, as evidenced by the large voter turnout (96.3%). In fact, an overwhelming 84.26% voted in favor of the contract.
SOUTHWEST AIR Price
SOUTHWEST AIR Price | SOUTHWEST AIR Quote
Labor-Related Issues Dominate
The low-cost carrier has been plagued by labor-related issues this year with some of its labor groups demanding the removal of its top executives. However, the carrier has been receiving encouraging news on the labor front in recent times.
The pilots' approval comes close on the heels of flight attendants of the carrier ratifying a pay-related deal which becomes amendable on Nov 1, 2018. The new deal guarantees ratification bonus and annual wage rate increases during its term.
Rising Labor Costs
We expect the carrier's labor costs to shoot up after the new deals. This can be made out from the carriers' fourth-quarter guidance for cost per available seat mile (CASM). Southwest Airlines expects CASM - excluding special items and profit sharing - to increase in the band of 4-5% in the final quarter of 2016. This is substantially higher than the 2.6% increase witnessed in the third quarter.
With labor deals in vogue in the aviation space, we note that not only Southwest Airlines but also its peers are seeing a spike in labor costs. The total operating expense of American Airlines Group AAL rose 5.2% in the third quarter to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company were the primary factors contributing to the increase in costs. The same factors hurt JetBlue Airways' JBLU third-quarter results. Moreover, CASM, excluding special charges, third-party business expenses, fuel and profit sharing, increased 3.4% at United Continental Holdings UAL in the third quarter, mainly due to the ratified labor deals.
Traffic Update
Apart from news on the labor front, Southwest Airlines revealed traffic data for October. The carrier's revenue passenger miles or RPMs (a measure of air traffic) improved 5.2% year over year to 10.5 billion. Available seat miles or ASMs (a measure of capacity) also grew 5.4% to 12.2 billion. Another important metric - load factor (percentage of seats filled by passengers) - contracted 20 basis points to 85.7% during the month as capacity expansion outpaced traffic growth.
The low-cost carrier reiterated its operating revenue per ASM (RASM) guidance for fourth-quarter 2016. It continues to expect the metric to fall in the band of 4-5%.
Southwest Airlines currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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SOUTHWEST AIR (LUV): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The total operating expense of American Airlines Group AAL rose 5.2% in the third quarter to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Reportedly, issues related to code share agreements and "retro pay" had prompted pilots to turn down the tentative deal last year.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The total operating expense of American Airlines Group AAL rose 5.2% in the third quarter to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. SOUTHWEST AIR Price SOUTHWEST AIR Price | SOUTHWEST AIR Quote Labor-Related Issues Dominate The low-cost carrier has been plagued by labor-related issues this year with some of its labor groups demanding the removal of its top executives.
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Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The total operating expense of American Airlines Group AAL rose 5.2% in the third quarter to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. Details of the Deal Last year, pilots of the low-cost carrier had rejected the tentative labor contract pertaining to their pay raise.
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The total operating expense of American Airlines Group AAL rose 5.2% in the third quarter to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Details of the Deal Last year, pilots of the low-cost carrier had rejected the tentative labor contract pertaining to their pay raise.
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7761.0
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2016-11-05 00:00:00 UTC
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Delta Jumps on the Premium Economy Bandwagon
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AAL
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https://www.nasdaq.com/articles/delta-jumps-premium-economy-bandwagon-2016-11-05
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nan
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nan
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In the past few years, all of the U.S. airlines offering long-haul service have put extra-legroom seats on their widebody fleets. They rightly recognized that plenty of travelers would pay a premium just to get a few extra inches of legroom on longer flights.
Most U.S. airlines offer some kind of extra-legroom seating today. Image source: The Motley Fool.
But aside from those precious inches, there hasn't been much to distinguish these extra-legroom seats from regular economy seats. By contrast, many foreign carriers offer premium economy sections that represent a middle-ground between economy seating and the extremely pricey lie-flat seats that have become standard in business-class cabins.
American Airlines (NASDAQ: AAL) shook up the market in late 2015, when it revealed plans to offer a true premium economy section on most of its long-haul flights. Apparently, Delta Air Lines (NYSE: DAL) feels that it can't afford to fall behind. Last week, Delta said that it will introduce premium economy seats on some long-haul flights beginning next year.
Premium economy comes to the U.S.
Last December, American Airlines announced that it would begin to roll out a new premium economy section on its wide-body fleet in late 2016. The seats themselves will be wider and offer more legroom (38 inches vs. 31 inches for a typical economy seat). Premium economy tickets will also include other amenities such as noise-canceling headphones, priority check-in and boarding, upgraded meals, and complimentary alcoholic beverages.
American's premium economy rollout is beginning with the 787-9, which began to enter its fleet a few months ago. (That said, the new premium economy section officially launches next April and can't be booked for flights before then.)
On the 787-9, American Airlines' premium economy section will be quite small, with just 21 seats. However, there will also be 27 of American's traditional extra-legroom seats, without the extra seat width and other perks of the new premium economy cabin.
In the next two years or so, American Airlines will retrofit most of its other wide-body aircraft with premium economy sections. The one exception is its aging (and shrinking) fleet of 767s, as most of those planes will be retired within a few years.
American Airlines will put premium economy seats on most of its wide-body planes. Image source: American Airlines.
Delta follows suit
Delta Air Lines didn't even wait for American Airlines to officially launch its new premium economy section before announcing its own competing option. Delta's new fleet of A350s, scheduled for delivery beginning in the second half of 2017, will come configured with a 48-seat premium economy cabin.
The product features are similar to what American Airlines is offering, starting with wider seats and 38 inches of legroom. Premium economy tickets will also include amenities like priority check-in, expedited security, early boarding, pre-departure beverage service, and an upgraded menu.
Delta also plans to retrofit its 777 fleet with premium economy seats in the coming years, but it isn't committing to adding premium sections to its other wide-body planes.
Delta isn't blindly copying American Airlines
Delta's premium economy cabin will be bigger than American's -- but it will be installed on just a few dozen planes. Image source: Delta Air Lines.
American Airlines' rollout of premium economy on its wide-body fleet clearly played a big role in Delta's decision to create a similar product. That said, Delta isn't just playing follow-the-leader. Its strategy around international premium economy service differs from American's in two key ways.
First, Delta's premium economy cabin is much bigger. 48 of the 306 seats on Delta's A350s will be in the new premium section, compared to just 21 out of 285 seats on American's 787-9. At the same time, Delta doesn't plan to have its regular Comfort+ extra-legroom seats on the A350, whereas American's 787-9 offers extra-legroom Main Cabin Extra seats as well as the new premium economy section.
Second, Delta is only installing the new premium economy sections on a small subset of its wide-body fleet. Delta isn't putting premium economy seats on its A330s or its 767s -- at least for now -- and those two aircraft types will account for more than 70% of its wide-body fleet for the foreseeable future.
These two points of differentiation are linked. The A350 and 777 (which are getting the new premium economy seats) are the longest-range planes in Delta's fleet. Delta is betting that customers will appreciate the extra space and amenities of the new premium economy seats on long-haul routes from the U.S. to Asia, Australia, Africa, and the Middle East.
By contrast, the A330s and 767s are mainly used for somewhat shorter flights from the U.S. to Europe and South America. On these routes, customers may be less willing to pay a lot extra for premium economy service.
Thus, while American Airlines is spreading its bets around by putting small premium economy cabins on nearly all of its wide-body planes, Delta Air Lines is making a bold bet on premium economy seating -- but only for its longest, most grueling flights.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
Adam Levine-Weinberg is long January 2017 $40 calls on Delta Air Lines. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (NASDAQ: AAL) shook up the market in late 2015, when it revealed plans to offer a true premium economy section on most of its long-haul flights. Premium economy tickets will also include amenities like priority check-in, expedited security, early boarding, pre-departure beverage service, and an upgraded menu. Delta is betting that customers will appreciate the extra space and amenities of the new premium economy seats on long-haul routes from the U.S. to Asia, Australia, Africa, and the Middle East.
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American Airlines (NASDAQ: AAL) shook up the market in late 2015, when it revealed plans to offer a true premium economy section on most of its long-haul flights. Delta follows suit Delta Air Lines didn't even wait for American Airlines to officially launch its new premium economy section before announcing its own competing option. Premium economy tickets will also include amenities like priority check-in, expedited security, early boarding, pre-departure beverage service, and an upgraded menu.
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American Airlines (NASDAQ: AAL) shook up the market in late 2015, when it revealed plans to offer a true premium economy section on most of its long-haul flights. Delta also plans to retrofit its 777 fleet with premium economy seats in the coming years, but it isn't committing to adding premium sections to its other wide-body planes. At the same time, Delta doesn't plan to have its regular Comfort+ extra-legroom seats on the A350, whereas American's 787-9 offers extra-legroom Main Cabin Extra seats as well as the new premium economy section.
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American Airlines (NASDAQ: AAL) shook up the market in late 2015, when it revealed plans to offer a true premium economy section on most of its long-haul flights. On the 787-9, American Airlines' premium economy section will be quite small, with just 21 seats. American Airlines will put premium economy seats on most of its wide-body planes.
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7762.0
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2016-11-03 00:00:00 UTC
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The Zacks Analyst Blog Highlights: Southwest Airlines, SkyWest, Allegiant Travel and American Airlines
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AAL
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https://www.nasdaq.com/articles/the-zacks-analyst-blog-highlights%3A-southwest-airlines-skywest-allegiant-travel-and
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nan
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For Immediate Release
Chicago, IL - November 03, 2016 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Southwest Airlines (NYSE: LUV - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ), Allegiant Travel Company (NASDAQ: ALGT - Free Report ) and American Airlines Group (NASDAQ: AAL - Free Report ).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Wednesday's Analyst Blog:
Airline Stock Roundup: LUV, SKYW, ALGT
The past week saw low-cost carrier Southwest Airlines (NYSE: LUV - Free Report ) stock losing value despite reporting better-than-expected earnings as well as revenues in the third quarter. The stock suffered mainly due to its lackluster guidance with respect to revenue per available seat mile (RASM: a measure of unit revenues). The carrier expects the metric to fall in the band of 4-5% in the fourth quarter, which compares unfavorably to the views of its peers for unit revenues.
The past week also saw SkyWest, Inc. (NASDAQ: SKYW - Free Report ) and Allegiant Travel Company (NASDAQ: ALGT - Free Report ) reporting better-than-expected third-quarter results. On the non-earnings front, Airlines for America ('A4A'), a leading trade group, predicted that 27.3 million passengers will opt for air travel in the upcoming Thanksgiving holiday period. The projection reflects a 2.5% increase from the 2015 figure. The International Air Transport Association ("IATA") has issued a bullish long-term forecast with passenger demand predicted to nearly double in 2035 from the 2016 levels.
Transportation - Airline Industry Price Index
(Read the last Airline Stock Roundup for Oct 26, 2016 ).
Recap of the Past Week's Most Important Stories
1. Southwest Airlines' third-quarter 2016 earnings per share (on an adjusted basis) of 93 cents beat the Zacks Consensus Estimate of 88 cents. Moreover, the carrier's revenues of $5,139 million edged past our expectation of $5,132 million. The adverse impact of rising labor costs on carriers' bottom line can be clearly made out from Southwest Airlines' cost per available seat mile (CASM) forecast. The carrier expects CASM - excluding special items and profit sharing - to increase in the band of 4-5% in the final quarter of 2016, which is much more than the 2.6% increase witnessed in the third quarter (Read more: Southwest Airlines Beats on Q3 Earnings & Revenues ).
The significance of labor deals was once again highlighted when the flight attendants of the low-cost carrier ratified the tentative pay-related deal inked last month. The contract becomes amendable on Nov 1, 2018.
2. St. George, UT-based SkyWest report impressive numbers for the third quarter of 2016. The carrier outperformed both in terms of earnings and revenues. The carrier's earnings of 90 cents per share were well ahead of the Zacks Consensus Estimate of 81 cents. Earnings also improved approximately 26.8% from the year-ago figure. Quarterly revenues of $800 million comfortably beat the Zacks Consensus Estimate of $773 million and inched up approximately 1% on a year-over-year basis. Results were aided by lower operating costs due to fewer aircraft in service.
3. Allegiant Travel Company's third-quarter 2016 earnings per share of $2.75 beat the Zacks Consensus Estimate by 9 cents. Quarterly revenues increased 11% year over year to $333 million and also surpassed the Zacks Consensus Estimate of $332 million. Air traffic rose 18.3% year over year due to a 20.2% rise in capacity, while load factor was 84.7% compared with 86.1% in the year-ago quarter. Average fuel expense declined 13.7% to $1.57 per gallon in the reported quarter.
For the fourth quarter of 2016, the company expects cost per available seat mile (CASM), excluding fuel, to grow in the range of 10-12%, primarily driven by the implementation of the new pilot agreement. The five-year deal became effective on Aug 1, 2016. Total revenue per available seat mile (TRASM) in the fourth quarter is likely to decline in the band of 5.5-7.5%.
4. According to a forecast by A4A, approximately 27.3 million passengers are expected to avail the services of U.S. airlines during the Thanksgiving holiday period this year, up 2.5% year over year. The forecast translates into 2.27 million fliers per day during the period (Nov 18-Nov 29), an increase of 55,000 from the comparable figure last year. Passenger volumes (on a daily basis) is projected to be in the range of 1.51 million to 2.81 million. The busiest day for the holiday period is expected to be Sunday, Nov 27. The lightest travel day is expected to be the Thanksgiving Day or Nov 24, 2016.
Cheap ticket prices are one of the main reasons behind the bullish forecast. According to the organization, air fares have fallen 5.6% on a year-over-year basis in the first nine months of the year. To meet the surge in demand, carriers are adding more seats (74,000 per day). In keeping with the rising demand, they intend to use either larger planes or introduce more flights.
5. The IATA issued a bullish long-term forecast regarding passenger travel, which is for the beleaguered airline industry. The association expects air travel to attract 7.2 billion passengers in 2035, almost double the 3.8 billion estimated for 2016. The Asia-Pacific region is expected to see the highest demand in air travel and is expected to be responsible for more than half the new passengers over the next two decades. The U.S. is expected to be dislodged from its position of top aviation market by China by 2024.
6. According to media reports, passengers at an American Airlines Group (NASDAQ: AAL - Free Report ) flight survived had a narrow escape as an engine failed just before the plane was to take off at Chicago's O'Hare International Airport. The engine caught fire and its debris apparently flew as far as half a mile from the scene of the mishap. The incident is being investigated by the National Transportation Safety Board.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free .
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Stocks recently featured in the blog include Southwest Airlines (NYSE: LUV - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ), Allegiant Travel Company (NASDAQ: ALGT - Free Report ) and American Airlines Group (NASDAQ: AAL - Free Report ). According to media reports, passengers at an American Airlines Group (NASDAQ: AAL - Free Report ) flight survived had a narrow escape as an engine failed just before the plane was to take off at Chicago's O'Hare International Airport. Get the full Report on LUV - FREE Get the full Report on SKYW - FREE Get the full Report on ALGT - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Stocks recently featured in the blog include Southwest Airlines (NYSE: LUV - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ), Allegiant Travel Company (NASDAQ: ALGT - Free Report ) and American Airlines Group (NASDAQ: AAL - Free Report ). Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. According to media reports, passengers at an American Airlines Group (NASDAQ: AAL - Free Report ) flight survived had a narrow escape as an engine failed just before the plane was to take off at Chicago's O'Hare International Airport.
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Stocks recently featured in the blog include Southwest Airlines (NYSE: LUV - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ), Allegiant Travel Company (NASDAQ: ALGT - Free Report ) and American Airlines Group (NASDAQ: AAL - Free Report ). Get the full Report on LUV - FREE Get the full Report on SKYW - FREE Get the full Report on ALGT - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report SOUTHWEST AIR (LUV): Free Stock Analysis Report SKYWEST INC (SKYW): Free Stock Analysis Report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here.
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Stocks recently featured in the blog include Southwest Airlines (NYSE: LUV - Free Report ), SkyWest, Inc. (NASDAQ: SKYW - Free Report ), Allegiant Travel Company (NASDAQ: ALGT - Free Report ) and American Airlines Group (NASDAQ: AAL - Free Report ). According to media reports, passengers at an American Airlines Group (NASDAQ: AAL - Free Report ) flight survived had a narrow escape as an engine failed just before the plane was to take off at Chicago's O'Hare International Airport. Get the full Report on LUV - FREE Get the full Report on SKYW - FREE Get the full Report on ALGT - FREE Get the full Report on AAL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7763.0
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2016-11-02 00:00:00 UTC
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Why American Airlines Group, Inc. Stock Rose 10.9% in October
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AAL
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https://www.nasdaq.com/articles/why-american-airlines-group-inc-stock-rose-109-october-2016-11-02
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nan
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What happened
American Airlines '(NASDAQ: AAL) stock performed poorly in 2015, falling more than 20%. The first half of 2016 was even worse, with the stock plunging nearly 40% by late June due to weak revenue trends throughout much of the world and fears about the impact of Brexit.
However, shares of the world's largest airline have regained a lot of ground since then. The rally continued in October, surging another 10.9%, according to data from S&P Global Market Intelligence .
American Airlines stock performance, 2015-present. Data source: YCharts .
So what
Weak unit revenue results were the primary cause of American Airlines stock's poor performance in 2015 and early 2016. The company actually posted record earnings throughout 2015 due to low oil prices , but investors rightly judged that American's 2015 profit margin was unsustainable. Once oil prices stabilized, American Airlines started to experience significant margin contraction.
Conversely, the stock's resurgence over the past several months has been powered by an improving unit revenue trend.
In Q2, American's revenue per available seat mile (RASM) declined 6.1% year over year. By contrast, in Q3, RASM fell just 2.2% year over year. That was significantly better than the company's original guidance . This solid result, reported last month, was the main driver of its double-digit share price gain in October.
American Airlines' unit revenue declined less than expected in Q3. Image source: American Airlines.
Now what
American Airlines expects another relatively solid revenue performance in Q4, with RASM down just 1%-3% year over year despite some unfavorable calendar shifts. That puts it on pace to be the first major airline in the U.S. to return to unit revenue growth in 2017.
However, just as American's "no-hedging" policy made it the first airline to benefit from falling fuel prices, it is also becoming the first airline to get hit by rising fuel prices. Even worse, non-fuel costs are spiraling higher.
Thus, despite the company's improving unit revenue trends, American Airlines' profit margin has quickly fallen toward the bottom of the airline industry this year. With the stock already having soared about 60% since late June, it's hard to see much further upside until the company gets its costs under control. As a result, I sold my American Airlines stock last month.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
Adam Levine-Weinberg has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened American Airlines '(NASDAQ: AAL) stock performed poorly in 2015, falling more than 20%. The first half of 2016 was even worse, with the stock plunging nearly 40% by late June due to weak revenue trends throughout much of the world and fears about the impact of Brexit. So what Weak unit revenue results were the primary cause of American Airlines stock's poor performance in 2015 and early 2016.
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What happened American Airlines '(NASDAQ: AAL) stock performed poorly in 2015, falling more than 20%. Now what American Airlines expects another relatively solid revenue performance in Q4, with RASM down just 1%-3% year over year despite some unfavorable calendar shifts. Thus, despite the company's improving unit revenue trends, American Airlines' profit margin has quickly fallen toward the bottom of the airline industry this year.
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What happened American Airlines '(NASDAQ: AAL) stock performed poorly in 2015, falling more than 20%. So what Weak unit revenue results were the primary cause of American Airlines stock's poor performance in 2015 and early 2016. However, just as American's "no-hedging" policy made it the first airline to benefit from falling fuel prices, it is also becoming the first airline to get hit by rising fuel prices.
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What happened American Airlines '(NASDAQ: AAL) stock performed poorly in 2015, falling more than 20%. So what Weak unit revenue results were the primary cause of American Airlines stock's poor performance in 2015 and early 2016. Thus, despite the company's improving unit revenue trends, American Airlines' profit margin has quickly fallen toward the bottom of the airline industry this year.
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7764.0
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2016-11-02 00:00:00 UTC
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American Airlines Group, Inc. (AAL) Ex-Dividend Date Scheduled for November 03, 2016
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-inc-aal-ex-dividend-date-scheduled-november-03-2016-2016-11-02
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nan
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American Airlines Group, Inc. ( AAL ) will begin trading ex-dividend on November 03, 2016. A cash dividend payment of $0.1 per share is scheduled to be paid on November 21, 2016. Shareholders who purchased AAL prior to the ex-dividend date are eligible for the cash dividend payment. This marks the 10th quarter that AAL has paid the same dividend. At the current stock price of $39.8, the dividend yield is 1.01%.
The previous trading day's last sale of AAL was $39.8, representing a -15.48% decrease from the 52 week high of $47.09 and a 60.16% increase over the 52 week low of $24.85.
AAL is a part of the Transportation sector, which includes companies such as FedEx Corporation ( FDX ) and Delta Air Lines, Inc. ( DAL ). AAL's current earnings per share, an indicator of a company's profitability, is $9.31. Zacks Investment Research reports AAL's forecasted earnings growth in 2016 as -40.35%, compared to an industry average of .8%.
For more information on the declaration, record and payment dates, visit the AAL Dividend History page. Our Dividend Calendar has the full list of stocks that have an ex-dividend today.
Interested in gaining exposure to AAL through an Exchange Traded Fund [ETF]?
The following ETF(s) have AAL as a top-10 holding:
PowerShares Dynamic Leisure & Entertainment Portfolio ( PEJ )
iShares Transportation AverageETF ( IYT )
SPDR Russell 1000 Low Volatility ETF ( LGLV )
Direxion NASDAQ-100 Equal Weighted Index Shares ( QQQE ).
The top-performing ETF of this group is QQQE with an increase of 5.26% over the last 100 days. PEJ has the highest percent weighting of AAL at 5.57%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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AAL is a part of the Transportation sector, which includes companies such as FedEx Corporation ( FDX ) and Delta Air Lines, Inc. ( DAL ). Zacks Investment Research reports AAL's forecasted earnings growth in 2016 as -40.35%, compared to an industry average of .8%. The following ETF(s) have AAL as a top-10 holding: PowerShares Dynamic Leisure & Entertainment Portfolio ( PEJ ) iShares Transportation AverageETF ( IYT ) SPDR Russell 1000 Low Volatility ETF ( LGLV ) Direxion NASDAQ-100 Equal Weighted Index Shares ( QQQE ).
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AAL's current earnings per share, an indicator of a company's profitability, is $9.31. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. American Airlines Group, Inc. ( AAL ) will begin trading ex-dividend on November 03, 2016.
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Shareholders who purchased AAL prior to the ex-dividend date are eligible for the cash dividend payment. For more information on the declaration, record and payment dates, visit the AAL Dividend History page. The following ETF(s) have AAL as a top-10 holding: PowerShares Dynamic Leisure & Entertainment Portfolio ( PEJ ) iShares Transportation AverageETF ( IYT ) SPDR Russell 1000 Low Volatility ETF ( LGLV ) Direxion NASDAQ-100 Equal Weighted Index Shares ( QQQE ).
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AAL's current earnings per share, an indicator of a company's profitability, is $9.31. American Airlines Group, Inc. ( AAL ) will begin trading ex-dividend on November 03, 2016. Shareholders who purchased AAL prior to the ex-dividend date are eligible for the cash dividend payment.
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7765.0
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2016-10-31 00:00:00 UTC
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JetBlue Airways Could Benefit From 2 Major Airport Expansion Projects
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AAL
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https://www.nasdaq.com/articles/jetblue-airways-could-benefit-2-major-airport-expansion-projects-2016-10-31
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nan
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nan
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In theory, airline giants like American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) should face intense competition across their route networks. There are few natural barriers to prevent smaller carriers from challenging entrenched airlines, even in their core markets.
This lack of barriers to entry allowed JetBlue Airways (NASDAQ: JBLU) to upend the U.S. airline industry after it burst onto the scene in 2000. It became a leading carrier in cities like New York, Boston, and Fort Lauderdale by offering leisure travelers lower fares and better amenities than the incumbents. More recently, it has been making inroads among business travelers, due in part to its new "Mint" premium long-haul service.
JetBlue has become the fifth largest U.S. airline in less than two decades. Image source: JetBlue Airways.
However, legacy carriers like Delta and American maintain one big advantage over upstarts like JetBlue: sizable slot portfolios at some of the most important airports in the world. Without access to slots, smaller airlines can't add flights at these airports, putting them at a disadvantage in competing for business travelers.
Thus, it's great for JetBlue when slot-constrained airports in key business markets are expanded, creating new slots. In the coming years, JetBlue could benefit from major airport expansion projects in Mexico City and London.
Mexico City is getting a new airport
Mexico City is already a key business hub within Latin America. As the Mexican economy develops, it will become an even more important city for business travelers.
One of Mexico City's biggest economic weaknesses is its substandard airport. Mexico City International Airport has been filled to capacity for years. Its runways are too close together for simultaneous operations, and there is no room to expand.
JetBlue began serving Mexico City in late 2015, but its daily flights to Fort Lauderdale and Orlando haven't been a big success. As one JetBlue executive recently put it, "Right now we're the carrier of choice if you want to fly at 5:00 a.m." JetBlue hasn't been able to secure any daytime slots in Mexico City, which severely limits its appeal to potential customers.
In the short run, JetBlue can try to gain a few extra slots from the eight slot pairs that Delta Air Lines must divest as a condition of forming a joint venture with Aeromexico. (Aeromexico already holds nearly half of the slots at Mexico City International Airport.) But this would only be a partial solution.
Delta will soon divest its eight slot pairs at Mexico City International Airport. Image source: The Motley Fool.
Fortunately, the Mexican government has begun construction of a new, much larger airport for Mexico City. If all goes well, the first phase of the new airport will be ready by 2020. This will enable greater competition.
With slot constraints removed, JetBlue could offer a more convenient flight schedule to Orlando and Fort Lauderdale, with multiple daily flights. It could also add service to Mexico City from its larger New York and Boston focus cities.
London airport expansion plans inch forward
An even more momentous airport project is slowly moving forward in London, the world's largest aviation market. The U.K. government recently endorsed building a third runway at London's overcrowded Heathrow Airport. It would be the first new runway built in the London area since World War II!
Earlier this year, JetBlue publicly acknowledged its interest in flying to Europe, using Airbus' upcoming A321LR aircraft. Yet any such effort would be complicated by the fact that Heathrow Airport -- the preferred London airport for business travelers -- doesn't have any slots available for new entrants.
Slots are rarely available for purchase, partly because British Airways and its joint venture partners (including American Airlines) control more than half of Heathrow's slots. They fetch enormous sums when they do come on the market. A few years ago, Delta paid $360 million for a minority stake in money-losing Virgin Atlantic just to have more access to slots at Heathrow Airport. Earlier this year, a single slot pair sold for a whopping $75 million.
Even if JetBlue managed to buy a few slot pairs at Heathrow Airport, the high cost of acquiring them would drive up its fares. By contrast, a third runway would increase the airport's capacity by about 50%, enabling hundreds of extra flights per day and creating room for new entrants like JetBlue.
If it can assemble a robust slot portfolio at Heathrow Airport, JetBlue's Mint premium service would be a great fit for the New York-London and Boston-London markets. JetBlue has been incredibly successful competing against the likes of Delta and American in the transcontinental market, and Mint could prove to be just as popular on transatlantic flights.
JetBlue's premium Mint service could be appealing for transatlantic flights. Image source: JetBlue Airways.
Heathrow's third runway isn't scheduled to open until 2025. With legal challenges in the pipeline, many observers think construction could drag out until 2030. Still, JetBlue is at least three or four years away from expanding into Europe -- and there are plenty of other cities it could serve profitably. It can afford to wait to make its move in London.
JetBlue has lots of opportunities
JetBlue Airways is already incredibly successful, but the company has tons of upside left. JetBlue was fortunate to secure a big footprint in New York before slots became scarce there, but it still lacks adequate access to some key business markets.
Upcoming airport expansion projects should allow JetBlue to build out a much more competitive schedule in Mexico City and give it access to the lucrative London market. This will support its continued evolution into a more business-friendly airline.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
Adam Levine-Weinberg owns shares of JetBlue Airways and is long January 2017 $17 calls on JetBlue Airways and long January 2017 $40 calls on Delta Air Lines. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In theory, airline giants like American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) should face intense competition across their route networks. It became a leading carrier in cities like New York, Boston, and Fort Lauderdale by offering leisure travelers lower fares and better amenities than the incumbents. By contrast, a third runway would increase the airport's capacity by about 50%, enabling hundreds of extra flights per day and creating room for new entrants like JetBlue.
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In theory, airline giants like American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) should face intense competition across their route networks. Without access to slots, smaller airlines can't add flights at these airports, putting them at a disadvantage in competing for business travelers. If it can assemble a robust slot portfolio at Heathrow Airport, JetBlue's Mint premium service would be a great fit for the New York-London and Boston-London markets.
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In theory, airline giants like American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) should face intense competition across their route networks. In the coming years, JetBlue could benefit from major airport expansion projects in Mexico City and London. As one JetBlue executive recently put it, "Right now we're the carrier of choice if you want to fly at 5:00 a.m." JetBlue hasn't been able to secure any daytime slots in Mexico City, which severely limits its appeal to potential customers.
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In theory, airline giants like American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) should face intense competition across their route networks. Without access to slots, smaller airlines can't add flights at these airports, putting them at a disadvantage in competing for business travelers. Delta will soon divest its eight slot pairs at Mexico City International Airport.
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7766.0
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2016-10-30 00:00:00 UTC
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The Supposedly Nefarious Story of Intrigue Behind the American Airlines-US Airways Merger
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AAL
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https://www.nasdaq.com/articles/supposedly-nefarious-story-intrigue-behind-american-airlines-us-airways-merger-2016-10-30
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nan
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nan
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Earlier this month, ProPublica published an expose on the 2013 merger between American Airlines (NASDAQ: AAL) and US Airways. The article contends that an army of lawyers and lobbyists exerted political influence over the antitrust review process through shady backroom deals, causing the Department of Justice to drop its opposition to the merger for no valid reason.
The article also concludes that the merger has had the negative effects originally predicted by the DOJ, most notably, tacit (or even active) collusion between the airlines to restrict capacity and drive up fares.
The truth is quite different, though. While American Airlines and US Airways certainly lobbied on behalf of the deal, they also made significant concessions to address the DOJ's concerns.
American Airlines and US Airways made big concessions to get their merger approved. Image source: American Airlines.
Furthermore, the persistent airfare declines of the past two years show that while four airlines -- American, Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) -- hold about 85% of the domestic market, they have far less pricing power than airline executives had assumed and regulators had feared.
Was the government's case kneecapped?
According to ProPublica, most of the rank-and-file staffers working on the American Airlines merger case were appalled that the government settled the case. Furthermore, American and US Airways enlisted some "high-profile Democrats" to lobby (both formally and informally) on behalf of the deal.
Yet while there was clearly a gap between what the DOJ alleged in its complaint and what it got in the settlement, lawyers do sometimes make shocking allegations to enhance their bargaining leverage. Ultimately, American Airlines and US Airways made major concessions, giving up dozens of slots at two of the most crowded airports in the U.S., as well as gate space at five other airports.
Divesting slots at Washington, D.C.'s Reagan National Airport and New York's LaGuardia Airport was a huge concession that the ProPublica article wrongly downplays. Selling slots to Southwest Airlines, JetBlue Airways , and Virgin America made those markets far more competitive than they were before the merger.
As a result, the average domestic fare at Reagan Airport in the first quarter of 2016 was 10.5% lower than it was two years earlier, before the slot divestments began. At LaGuardia Airport, the average fare was down 12.2%. On the specific routes that saw the most added competition, such as New York-Dallas and Washington-Dallas, fares in Q1 2016 were down by more than a third over that two-year period!
Increased competition has driven fares lower in New York and Washington, D.C. Image source: The Motley Fool.
Had the DOJ blocked the merger entirely, rather than settling the case, low-cost carriers would have had no opportunity to grow in these capacity-constrained markets. This would have led to higher fares. Opening up Reagan Airport and LaGuardia Airport to more competition was reason enough for the DOJ to settle its case against American, regardless of any improper political influence.
Not much evidence of collusion or pricing power
In November 2013, when the DOJ decided to settle the antitrust case, you could at least make a plausible argument that the merger would make it too easy for the big airlines to tacitly collude. Executives at American, Delta, United, and even Southwest have all talked about the industry's commitment to capacity discipline (i.e., slow enough growth that fares stay high).
After two years of declining airfares, it's pretty clear that airlines don't have much pricing power and aren't colluding to drive up prices.
In late 2014 and early 2015, as oil prices were plummeting, aviation pundits warned consumers not to expect fares to fall. The management teams at American Airlines and Delta Air Lines specifically stated that they would hold fares steady so that fuel cost savings would flow straight to the bottom line.
Yet despite these pronouncements, fares have been falling. The average domestic airfare in Q1 2016 (the most recent quarter for which federal data is available) was down 5.5% from two years earlier. That actually understates how much fares have fallen, because airlines are gradually shifting their networks toward longer flights, which naturally tend to cost more. And based on airlines' reported revenue results over the past six months, it's clear that the pace of decline has accelerated.
Fares have been falling at Delta -- highlighting its limited pricing power. Image source: The Motley Fool.
Looking at American and Delta specifically, the results are even starker. Delta's yield (the average fare per mile flown) fell 5.4% in Q3 2015 and then fell another 5.3% in Q3 2016. At American Airlines, yields plunged 9.2% in Q3 2015 and then declined another 0.6% last quarter. (In case you were curious, yields at United Continental slumped 5.6% in Q3 2015 and 5.7% in Q3 2016.)
This is a textbook example of Adam Smith's "invisible hand" at work. Airline executives all wanted to keep fares high -- yet in their efforts to maximize their earnings, they ended up driving fares lower, helping consumers.
DOJ made the right call
In short, while American Airlines and US Airways put pressure on regulators to approve their merger, there's no evidence that they got the DOJ to drop its opposition through unethical means. With 20/20 hindsight, it looks like the DOJ got a very good deal, stimulating huge competition in two major cities without giving the airlines any appreciable increase in pricing power.
Skeptics of the deal would argue that fares should have fallen even further given how far oil prices dropped. But while fuel costs are down significantly, labor costs are rising. Airlines are also investing heavily in updating their fleets with modern aircraft.
After taking those factors into account, it appears that all three legacy carriers have now passed through the majority of their fuel cost savings to customers. This fits in with the longer-term trend of airfares declining steadily on an inflation-adjusted basis. The evidence available shows that the American Airlines-US Airways merger hasn't harmed competition. ProPublica's innuendo that the outcome was rigged by special interests doesn't hold up to scrutiny.
A secret billion-dollar stock opportunity
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Adam Levine-Weinberg owns shares of JetBlue Airways and United Continental Holdings and is long January 2017 $17 calls on JetBlue Airways and long January 2017 $40 calls on Delta Air Lines. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Earlier this month, ProPublica published an expose on the 2013 merger between American Airlines (NASDAQ: AAL) and US Airways. The article contends that an army of lawyers and lobbyists exerted political influence over the antitrust review process through shady backroom deals, causing the Department of Justice to drop its opposition to the merger for no valid reason. The article also concludes that the merger has had the negative effects originally predicted by the DOJ, most notably, tacit (or even active) collusion between the airlines to restrict capacity and drive up fares.
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Earlier this month, ProPublica published an expose on the 2013 merger between American Airlines (NASDAQ: AAL) and US Airways. Furthermore, the persistent airfare declines of the past two years show that while four airlines -- American, Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) -- hold about 85% of the domestic market, they have far less pricing power than airline executives had assumed and regulators had feared. Divesting slots at Washington, D.C.'s Reagan National Airport and New York's LaGuardia Airport was a huge concession that the ProPublica article wrongly downplays.
|
Earlier this month, ProPublica published an expose on the 2013 merger between American Airlines (NASDAQ: AAL) and US Airways. Furthermore, the persistent airfare declines of the past two years show that while four airlines -- American, Delta Air Lines (NYSE: DAL) , United Continental (NYSE: UAL) , and Southwest Airlines (NYSE: LUV) -- hold about 85% of the domestic market, they have far less pricing power than airline executives had assumed and regulators had feared. The management teams at American Airlines and Delta Air Lines specifically stated that they would hold fares steady so that fuel cost savings would flow straight to the bottom line.
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Earlier this month, ProPublica published an expose on the 2013 merger between American Airlines (NASDAQ: AAL) and US Airways. According to ProPublica, most of the rank-and-file staffers working on the American Airlines merger case were appalled that the government settled the case. Not much evidence of collusion or pricing power In November 2013, when the DOJ decided to settle the antitrust case, you could at least make a plausible argument that the merger would make it too easy for the big airlines to tacitly collude.
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7767.0
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2016-10-28 00:00:00 UTC
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Zacks Industry Outlook Highlights: Delta Air Lines, United Continental, American Airlines Group, Copa Holdings and GOL Linhas
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AAL
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https://www.nasdaq.com/articles/zacks-industry-outlook-highlights%3A-delta-air-lines-united-continental-american-airlines
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nan
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For Immediate Release
Chicago, IL - October 28, 2016 - Today, Zacks Equity Research discusses the Airlines, part 1, including Delta Air Lines (NYSE: DAL - Free Report ), United Continental (NYSE: UAL - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ), Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ).
Industry: Airlines, part 1
Link: https://www.zacks.com/commentary/94250/airline-industry-outlook---october-2016
Airline stocks, which were investor favorites not so long ago, have somewhat lost their appeal, thanks to the number of issues the sector is currently grappling with. The latest challenge has come in the form of Hurricane Matthew, which has disrupted travel plans and caused many carriers to cancel flights/offer refunds for the security of passengers.
Modest Q3 Results
Unit revenue issues have been plaguing the airline stocks for quite some time and the third quarter of 2016 was no exception.
We note that passenger unit revenues declined 6.8% year over year at Delta Air Lines (NYSE: DAL - Free Report ) in the third quarter. Consolidated passenger revenue per available seat mile (PRASM, or unit revenues) declined 5.8% in the third quarter at United Continental (NYSE: UAL - Free Report ). Both these carriers registered a decrease in earnings as well as revenues in the third quarter. Though American Airlines Group (NASDAQ: AAL - Free Report ) posted better-than-expected quarterly results, it recorded a year-over-year deterioration in the top line.
Declining air fares, which have been a major headwind for airline companies in recent times, was one of the factors hurting results. Increasing labor costs, as many carriers have been inking new labor deals, also hampered bottom-line growth. Investors should note that total operating expenses at American Airlines rose 5.2% in the third quarter to $9.2 billion mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company were one of the primary factors contributing to the increase in costs. JetBlue's third quarter results were also hit by higher labor costs.
Moreover, the absence of any notable stock price appreciation for most companies in spite of their earnings beats can be attributed to prevailing headwinds in the space. The Transportation-Airline segment's Zacks Industry rank of 241 (out of more than 260 industries) highlights the risks faced by the airline space. With the entire industry struggling as reflected by the disappointing Zacks Industry rank, it is of little surprise that Buy-rated stocks are hard to find in the airline space. In fact, Latin American carriers Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ) are the only stocks to sport a Zacks Rank #1 (Strong Buy) in the space.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Get the full Report on DAL - FREE
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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DELTA AIR LINES (DAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
COPA HLDGS SA-A (CPA): Free Stock Analysis Report
GOL LINHAS-ADR (GOL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Though American Airlines Group (NASDAQ: AAL - Free Report ) posted better-than-expected quarterly results, it recorded a year-over-year deterioration in the top line. For Immediate Release Chicago, IL - October 28, 2016 - Today, Zacks Equity Research discusses the Airlines, part 1, including Delta Air Lines (NYSE: DAL - Free Report ), United Continental (NYSE: UAL - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ), Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ). Get the full Report on DAL - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on CPA - FREE Get the full Report on GOL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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For Immediate Release Chicago, IL - October 28, 2016 - Today, Zacks Equity Research discusses the Airlines, part 1, including Delta Air Lines (NYSE: DAL - Free Report ), United Continental (NYSE: UAL - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ), Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ). Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report COPA HLDGS SA-A (CPA): Free Stock Analysis Report GOL LINHAS-ADR (GOL): Free Stock Analysis Report To read this article on Zacks.com click here. Though American Airlines Group (NASDAQ: AAL - Free Report ) posted better-than-expected quarterly results, it recorded a year-over-year deterioration in the top line.
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For Immediate Release Chicago, IL - October 28, 2016 - Today, Zacks Equity Research discusses the Airlines, part 1, including Delta Air Lines (NYSE: DAL - Free Report ), United Continental (NYSE: UAL - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ), Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ). Get the full Report on DAL - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on CPA - FREE Get the full Report on GOL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report COPA HLDGS SA-A (CPA): Free Stock Analysis Report GOL LINHAS-ADR (GOL): Free Stock Analysis Report To read this article on Zacks.com click here.
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For Immediate Release Chicago, IL - October 28, 2016 - Today, Zacks Equity Research discusses the Airlines, part 1, including Delta Air Lines (NYSE: DAL - Free Report ), United Continental (NYSE: UAL - Free Report ), American Airlines Group (NASDAQ: AAL - Free Report ), Copa Holdings (NYSE: CPA - Free Report ) and GOL Linhas (NYSE: GOL - Free Report ). Though American Airlines Group (NASDAQ: AAL - Free Report ) posted better-than-expected quarterly results, it recorded a year-over-year deterioration in the top line. Get the full Report on DAL - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on CPA - FREE Get the full Report on GOL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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7768.0
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2016-10-27 00:00:00 UTC
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Stock Exchange: Oscar And Airlines; Fastenal And U.S. Silica Attractive Trades
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AAL
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https://www.nasdaq.com/articles/stock-exchange-oscar-and-airlines-fastenal-and-us-silica-attractive-trades-2016-10-27
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By Jeff Miller :
Each week, Felix and Oscar host a poker game. We listen in on current trading ideas in the few minutes before the game starts. They like to call this their "Stock Exchange." I am the only human present, and the only one using fundamental analysis. Their methods are excellent, as you will learn if you join us for a few weeks. As the time frames and risk profiles differ, so do the stock ideas.
This is the only place you can get several great technical ideas each week, along with a response based upon the fundamentals. I have placed more background at the end of the article. Each week features a different expert. The names help you pick a favorite trading style. Comments, dissent, and specific stock questions are welcome!
This Week's Ideas - Focus on Oscar
Our featured expert is Oscar. Vince (our modeling guru) designed Oscar to be an aggressive sector trader. The time horizon is about three weeks. Oscar's trading universe is over 30 sectors. Unlike most other sector models, Oscar uses baskets of stocks chosen through a statistical analysis of actual trading. If there are important gaps, we use an ETF instead. Oscar takes more chances than the other models, but employs two elements of risk control:
Using a basket eliminates single stock risk, where something surprising happens to a single company.
Oscar goes to cash or bonds when market conditions are poor.
Even if you do not trade market sectors, Oscar's top choices are a good place to begin your own research.
Here are the ideas for this week, beginning with Oscar, our featured expert.
Oscar
I still like the Energy and Utilities sectors we've been discussing lately, but the U.S. Global Jets ETF ( JETS ) is my pick for this week. This is a sector that's underperformed for the past 6 months, but has still shown some overall steady growth. This would be an example of the "sleeper" everyone wants to pick up for their weekly fantasy football team.
You can see the same below with American Airlines ( AAL ). It is one of the major holdings in JETS - and it's not hard to see why. If you're looking for a stock like the overall industry, AAL is likely your best bet.
J:
O: No! I found this one on my own. And I don't care for the Jets, no matter who is at quarterback.
J: Richard Branson said that you can become a millionaire by starting with a billion dollars and buying an airline.
O: Who is Richard Branson? I am going by the chart.
J: At least you picked a company that has earnings, although we only have three years of history since the last bankruptcy.
O: You are so negative! I said it was a sleeper.
J: Right. Fantasy football. You are not even playing in the office fantasy pool.
O: That is child's play. I am in a league with some of those Chicago models. Any of us could win your league.
Holmes
As people should know by now, I love to buy the dips. (See last week's Stock Exchange for more information about Holmes). This week, Fastenal ( FAST ) is on my buy list. This wholesale distributer of industrial and construction supplies has suffered mightily since April, but it looks to me like it's ready for a bounce, and I'm ready to pounce. I'll be very cautious and get out below $37, but I'm looking for a rebound to $41.25 or better.
J:
O: That is why I use stops.
Felix
I have studiously selected Basic Materials: Metals and Minerals this week. U.S. Silica ( SLCA ) is a prime textbook example of what a chart should be. It has great momentum and should be around for a long time.
J:
F: Look at the chart.
J: Look at this chart from Chuck Carnevale. Only losses this year.
F:
Questions for Felix
anpere of SeekingAlpha says:
Felix: Hi anpere, you've a long list of energy stocks, and my opinion is not specific to those, but to energy. I, too, have a long list of energy holdings, and I hope they are all winners! Good luck with your picks, they should coincide with mine!
Felix: I rate DIS near the bottom of the 700-stock universe.
Jeff: I think it is OK - reasonable value now, and projected earnings increases.
Felix: SPWR is not in my current trading universe. They are asking me to expand the universe for questions, but have not yet agreed to raise my pay.
Jeff: I prefer either a solid record of earnings. If I am choosing to speculate, I need a very good story. I don't see either one in SPWR.
Felix: And to my many fans: Please keep your questions coming. I could use the overtime pay! Ask about a specific stock, or perhaps an ETF. I am interested in sectors, but need a representative ETF to help.
Athena
I do not have a new idea this week. Most of my choices are from April, and they are all doing well.
J: No new idea? What do you think we are paying you for?
A: Wisdom. Sometimes the smartest course is to do nothing. I like my current positions. The only soft one is Carter ( CRI ), which just did well on earnings.
J: You do not do any earnings forecasts.
A: The chart tells all... you just need to pay attention.
Background on the Stock Exchange
What is this about? Since launching this series, I have had good questions on three general themes. Here are the questions and some brief answers.
The model characters are fun, but please tell me more about what they do.
I include the general personality of the model at the end of each article. I will begin featuring one approach each week with more detail, and will soon provide a reference page for readers.
Why don't you show a track record on performance?
I understand that those trying to sell a newsletter or chat room often provide some sort of time-stamped real-time record. You will find that most of these people are not subject to compliance rules. The "track records" tell you nothing, since they do not have enough trades to get into the "long run." Confidence in a model comes from knowing how it is developed and tested. I would rather ask a few questions to a developer than see a few months of real-time picks. It is easy to spot the amateurs.
Why should I care about these model picks?
You probably read many articles with stock ideas. Some are a single idea based upon technical analysis from a source you do not know about. At the Stock Exchange, you get four different recommendations from technical "experts," as well as some fundamental commentary as a rebuttal. I am not trying to sell anything. We are developing an institutional product. The results are good enough that I am willing to share and discuss with readers. Some of my clients are invested in these models, so I am not going to provide every trade in real time. It is supposed to be interesting and fun! Look at the ideas and do your own research.
Questions
If you want an opinion about a specific stock or sector, even those we did not mention, just ask! Put questions in the comments. Address them to a specific expert if you wish. Each has a specialty. Who is your favorite? (You can choose me, although my feelings will not be hurt very much if you prefer one of the models).
Cast of Characters
Felix is fussy, precise, and very cautious. He looks for what is working, but it also must have upside potential. He is an investor who thinks long term. Felix will not usually announce new picks, but he will answer questions, saying what he thinks about specific stocks. He will also comment on favorite themes and sectors.
Oscar is naturally optimistic and a bit excitable. He likes to go with winners, and focuses on a one-month time frame. He trades either sector ETFs or a basket of stocks (equally weighted) that reflect a sector. Oscar will mention a favorite sector each week, and will also answer questions about sectors.
Holmes is a trader, but a cautious one. Holmes emphasizes asset protection through profit-taking, stops, and trailing stops. He is careful in selecting new positions, and generally looks at an intermediate time frame. While he does not know the definition of "mean reversion," he loves rebounds! There is no set holding period, but two or three months is not unusual. Holmes will tell us one stock recommended that week. For those who sign up for his email list (no charge, privacy respected, holmes at newarc dot com), he will report exits with a one-day delay.
Athena trades more frequently than the others, but still limits risk. Her inspiration helps to find good ideas. Her excellent quant skills find attractive risk/reward opportunities. Her wisdom leads her to exit trades that are not working. Athena will provide a new idea each week.
Jeff usually has some comments about stock or market fundamentals. Unlike the other witty participants, he sounds like an old prof.
The conversation is light-hearted, but the stock analysis is serious. We own positions in each of the stocks mentioned.
See also InsiderInsights.com Daily Round Up 11/8/16: NMFC, NEWM, LBTYA, LBTYK on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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You can see the same below with American Airlines ( AAL ). If you're looking for a stock like the overall industry, AAL is likely your best bet. Unlike most other sector models, Oscar uses baskets of stocks chosen through a statistical analysis of actual trading.
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You can see the same below with American Airlines ( AAL ). If you're looking for a stock like the overall industry, AAL is likely your best bet. This Week's Ideas - Focus on Oscar Our featured expert is Oscar.
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You can see the same below with American Airlines ( AAL ). If you're looking for a stock like the overall industry, AAL is likely your best bet. Unlike most other sector models, Oscar uses baskets of stocks chosen through a statistical analysis of actual trading.
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You can see the same below with American Airlines ( AAL ). If you're looking for a stock like the overall industry, AAL is likely your best bet. This Week's Ideas - Focus on Oscar Our featured expert is Oscar.
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7769.0
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2016-10-26 00:00:00 UTC
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Nasdaq 100 Movers: AAPL, AKAM
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AAL
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https://www.nasdaq.com/articles/nasdaq-100-movers-aapl-akam-2016-10-26
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nan
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nan
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In early trading on Wednesday, shares of Akamai Technologies ( AKAM ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 14.3%. Year to date, Akamai Technologies registers a 28.3% gain.
And the worst performing Nasdaq 100 component thus far on the day is Apple ( AAPL ), trading down 3.9%. Apple is showing a gain of 8.0% looking at the year to date performance.
Two other components making moves today are American Airlines Group ( AAL ), trading down 2.3%, and Biogen ( BIIB ), trading up 4.9% on the day.
VIDEO: Nasdaq 100 Movers: AAPL, AKAM
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 2.3%, and Biogen ( BIIB ), trading up 4.9% on the day. In early trading on Wednesday, shares of Akamai Technologies ( AKAM ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 14.3%. And the worst performing Nasdaq 100 component thus far on the day is Apple ( AAPL ), trading down 3.9%.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 2.3%, and Biogen ( BIIB ), trading up 4.9% on the day. And the worst performing Nasdaq 100 component thus far on the day is Apple ( AAPL ), trading down 3.9%. VIDEO: Nasdaq 100 Movers: AAPL, AKAM The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 2.3%, and Biogen ( BIIB ), trading up 4.9% on the day. In early trading on Wednesday, shares of Akamai Technologies ( AKAM ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 14.3%. And the worst performing Nasdaq 100 component thus far on the day is Apple ( AAPL ), trading down 3.9%.
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Two other components making moves today are American Airlines Group ( AAL ), trading down 2.3%, and Biogen ( BIIB ), trading up 4.9% on the day. In early trading on Wednesday, shares of Akamai Technologies ( AKAM ) topped the list of the day's best performing components of the Nasdaq 100 index, trading up 14.3%. And the worst performing Nasdaq 100 component thus far on the day is Apple ( AAPL ), trading down 3.9%.
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7770.0
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2016-10-26 00:00:00 UTC
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3 Lowest-P/E Stocks Today
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AAL
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https://www.nasdaq.com/articles/3-lowest-pe-stocks-today-2016-10-26
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nan
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RIG data by YCharts .
With a trailing P/E ratio of 3, you might think that Transocean's stock is now so cheap that it has turned into a value investor's dream. However, the company's net income is projected to turned negative next year, which threatens to turn this formerly highly profitable business into a money-losing pit. Worse yet, demand for the company's services are highly leveraged to the price of oil, so it is nearly impossible to predict when demand will return.
That suggests to me that this stock could be a value trap, so I'd recommend that potential investors should proceed with caution.
Profits are flying south
The massive fall in energy prices has been a boon to the airline industry, leading several carriers to book record profits. However, falling costs have caused carriers to compete heavily on price in order to fill seats, which has caused unit revenue to decline. That fact has held back American Airlines Group's stock, currently down more than 13% from its 52-week high. Mix soaring profits with a declining share price, and you get a stock that is currently trading at 3.9 times trailing earnings.
Investors have been waiting patiently for the major airlines to follow through on their plans to reduce capacity, which in theory should cause unit revenues to pick up. Thus far we haven't seen that happen, although there are emerging signs that higher revenue could be in the cards for next year.
GM data by YCharts .
Investors have had a hard getting bullish on the automaker's prospects, and it is not hard to figure out why. Low gas prices have fueled sales of trucks and SUVs, leading some to believe that we are at peak U.S. auto sales. There was also the ignition-switch debacle that caused the company's brand to take a hit. Longer-term, it is still unclear how emerging trends like car-sharing, autonomous driving, and the move to electric cars will affect the legacy automakers. Add it all up, and General Motors' stock hasn't moved much.
GM's profits have been heading up, so its sideways stock has pulled its trailing P/E ratio all the way down to 4. However, like American Airlines Group's, analysts are projecting that the company's earnings per share will drop next year, though only modestly. That pushes its forward P/E ratio all the way up to 5, which I don't think you could call "expensive" with a straight face.
Are any worth buying?
I'm not terribly bullish on any of these stocks right now, but I do think that General Motors is the most attractive of the group. While profits are expected to modestly decline next year, market-watchers believe that the company will be able to grow profits by more than 10% annually over the next five years. Investors also get to bank a generous dividend yield of 4.6% while they wait for the growth to play out. Those figures suggest that General Motors is a stock that value investors might want to look at with a fine-tooth comb.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
Brian Feroldi has no position in any stocks mentioned.Like this article? Follow him on Twitter where he goes by the handle@Longtermmindset or connect with him onLinkedInto see more articles like this.
The Motley Fool recommends General Motors. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Investors have been waiting patiently for the major airlines to follow through on their plans to reduce capacity, which in theory should cause unit revenues to pick up. Longer-term, it is still unclear how emerging trends like car-sharing, autonomous driving, and the move to electric cars will affect the legacy automakers. However, like American Airlines Group's, analysts are projecting that the company's earnings per share will drop next year, though only modestly.
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Add it all up, and General Motors' stock hasn't moved much. However, like American Airlines Group's, analysts are projecting that the company's earnings per share will drop next year, though only modestly. The Motley Fool recommends General Motors.
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While profits are expected to modestly decline next year, market-watchers believe that the company will be able to grow profits by more than 10% annually over the next five years. Those figures suggest that General Motors is a stock that value investors might want to look at with a fine-tooth comb. A secret billion-dollar stock opportunity The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology.
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However, like American Airlines Group's, analysts are projecting that the company's earnings per share will drop next year, though only modestly. While profits are expected to modestly decline next year, market-watchers believe that the company will be able to grow profits by more than 10% annually over the next five years. The Motley Fool recommends General Motors.
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7771.0
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2016-10-25 00:00:00 UTC
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I Just Sold My American Airlines Stock: Here's Why
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AAL
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https://www.nasdaq.com/articles/i-just-sold-my-american-airlines-stock-heres-why-2016-10-25
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nan
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nan
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Last week, American Airlines Group (NASDAQ: AAL) reported that its revenue per available seat mile (RASM) declined 2.2% year over year in the third quarter. Ideally, investors would like to see RASM growing at airlines, but this was still a much better result than either Delta Air Lines (NYSE: DAL) or United Continental Holdings (NYSE: UAL) could muster.
This improving unit-revenue trajectory has helped American Airlines stock pull out of a steep dive that sent it as low as $25 in late June. Indeed, the share price has rebounded by a stunning 60% in the past four months:
American Airlines stock performance, 2015 to present. Data by YCharts .
However, skyrocketing costs are a big problem. As a result, American's profitability has plunged far below that of Delta, and it now rivals United Continental for the ignominious title of least-profitable major airline. Unfortunately, the company's management isn't acting aggressively enough to get profit growing again.
Profitability falls behind rivals
In 2015, American Airlines had the highest profit margin among the three legacy carriers. A big driver of American's outperformance was its savvy decision not to hedge its fuel costs. This allowed it to pay less for jet fuel than Delta and United last year.
That fuel-cost advantage has shrunk in 2016, as hedging losses have declined for American's peers. Meanwhile, non-fuel unit costs have been rising at an elevated rate at American Airlines, due to the impact of new labor contracts that incorporated sizable pay raises.
As a result, American Airlines' profit margin has begun to contract. Last quarter, the company posted an adjusted pretax margin of 14%, down from 17.7% a year earlier. By contrast, Delta's adjusted pretax margin was 18.2%, despite the impact of its August technology outage . Most notably, perennial laggard United Continental outpaced American Airlines with a 15.2% adjusted pretax margin.
American Airlines' profit margin is declining at an alarming rate. Image source: American Airlines.
One could perhaps blame this fall below United on the margin front in Q3 on seasonality -- and American Airlines CEO Doug Parker did just that on the company'searnings calllast week. But this disparity is on pace to continue in Q4. United currently projects that its Q4 adjusted pretax margin will be 5% to 7%, compared to American's forecast of 4% to 6%.
It's all about costs
American Airlines expects its revenue outperformance to continue in Q4. But as its subpar margin guidance implies, that's not enough to overcome the drag from rising costs.
In Q3, American's cost per available seat mile (CASM) -- adjusted to exclude fuel and special items -- rose 6.8% year over year. By contrast, adjusted CASM rose 3.4% year over year at United and just 0.1% at Delta. American's Q4 forecast calls for a similar high-single-digit increase in adjusted non-fuel CASM in the coming quarter.
American Airlines' management has suggested to investors that this year's cost increases are the result of a one-time step-up in labor rates. Yet CFO Derek Kerr gave informal guidance last week that adjusted CASM will rise by about 4 percentage points in 2017: half from annualizing the impact of recent labor deals and half from other, more normal cost-inflation drivers.
Pilot wages are set to rise significantly at Delta and United. Image source: The Motley Fool.
Non-fuel CASM should stabilize in 2018 and 2019, thanks to slower increases in labor costs and long-awaited merger-related cost synergies.
However, cost creep may reemerge around 2020. American's pilots are locked into a contract with modest raises through 2019. The pay rates are now dramatically below market, after Delta Air Lines pilots won 30% raises in a tentative agreement reached just last month. The incremental annual cost of offering a market-rate contract could exceed $500 million.
Unit-revenue growth isn't enough
As I have previously noted, among the three legacy carriers, American Airlines has the clearest path to return to unit-revenue growth . However, that has already been reflected in its stock price, which has recovered nicely since mid-2016 -- even as analysts have continued to slash their forward earnings estimates.
With oil prices starting to recover, even a return to low-single-digit unit-revenue growth will lead to further margin declines for American Airlines in 2017.
Considering the company's massive debt load and sizable pension obligations, American Airlines stock simply isn't very cheap anymore. Good unit-revenue results could make the stock pop in the short run, but in the long run, the company needs to maintain a double-digit pretax margin to provide strong results for shareholders. Right now, it looks like that will be hard to achieve in 2017.
Thus, I decided to use the recent rally in American Airlines stock as an opportunity to sell. Until the company's management offers a credible cost-cutting plan, I intend to stay away.
A secret billion-dollar stock opportunity
The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here .
Adam Levine-Weinberg owns shares of United Continental Holdings and is long January 2017 $40 calls on Delta Air Lines. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Last week, American Airlines Group (NASDAQ: AAL) reported that its revenue per available seat mile (RASM) declined 2.2% year over year in the third quarter. Meanwhile, non-fuel unit costs have been rising at an elevated rate at American Airlines, due to the impact of new labor contracts that incorporated sizable pay raises. One could perhaps blame this fall below United on the margin front in Q3 on seasonality -- and American Airlines CEO Doug Parker did just that on the company'searnings calllast week.
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Last week, American Airlines Group (NASDAQ: AAL) reported that its revenue per available seat mile (RASM) declined 2.2% year over year in the third quarter. Ideally, investors would like to see RASM growing at airlines, but this was still a much better result than either Delta Air Lines (NYSE: DAL) or United Continental Holdings (NYSE: UAL) could muster. Meanwhile, non-fuel unit costs have been rising at an elevated rate at American Airlines, due to the impact of new labor contracts that incorporated sizable pay raises.
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Last week, American Airlines Group (NASDAQ: AAL) reported that its revenue per available seat mile (RASM) declined 2.2% year over year in the third quarter. Meanwhile, non-fuel unit costs have been rising at an elevated rate at American Airlines, due to the impact of new labor contracts that incorporated sizable pay raises. Most notably, perennial laggard United Continental outpaced American Airlines with a 15.2% adjusted pretax margin.
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Last week, American Airlines Group (NASDAQ: AAL) reported that its revenue per available seat mile (RASM) declined 2.2% year over year in the third quarter. Unfortunately, the company's management isn't acting aggressively enough to get profit growing again. Meanwhile, non-fuel unit costs have been rising at an elevated rate at American Airlines, due to the impact of new labor contracts that incorporated sizable pay raises.
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7772.0
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2016-10-25 00:00:00 UTC
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3 Airline Stocks That Will Fly High in 2017
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AAL
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https://www.nasdaq.com/articles/3-airline-stocks-that-will-fly-high-in-2017-2016-10-25
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nan
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nan
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InvestorPlaceInvestorPlace - Stock Market News, Stock Advice & Trading Tips
Over the last few years, falling oil prices have helped airline stocks regain their footing and return to profitability after a rough patch that saw many carriers file for bankruptcy. While the benefits of lower fuel prices have already been priced in, the sector still offers investors some good long-term investment options.
Source: amanda kelso via Flickr (Modified)
The airline industry carries a lot of risk with macroeconomic factors, safety records and public perception all weighing on airlines' bottom lines. With that being said, air travel is becoming increasingly popular and accessible, making it a good place to park your money for the long-term.
While flagship carriers like American Airlines Group Inc (NASDAQ: AAL ) may be the first investment options that spring to mind, there are several other airline stocks that are poised to deliver impressive gains by 2017.
What Stocks Will Win the 2016 Election?
Here's a look at three airline stocks with great growth potential that investors should consider adding to their portfolios.
Airline Stocks to Buy: Ryanair Holdings plc (ADR) (RYAAY)
Source: Aurelijus Valeiša via Flickr (Modified)
European low-cost airline Ryanair Holdings plc (ADR) (NASDAQ: RYAAY ) is a good place to start when it comes to airline investments. RYAAY has consistently delivered impressive growth from quarter-to-quarter and has an impeccable safety record, making it a good buy within the industry. Ryanair has considerably stronger financials than other airline companies - its debt-to-equity ratio stands at just 105% compared to 125% at United Continental Holdings Inc (NYSE: UAL ) or 530% at AAL.
Now is a great time to buy RYAAY as well. Brexit worries have weighed on European companies and Ryanair recently issued a profit warning due to the pound's sharp decline in the aftermath of the vote, cutting its guidance by 5%, which caused many investors to abandon the airline. While this is certainly a headwind for RYAAY, the company's performance in times of trouble is one good reason to jump on board now.
Currency headwinds are expected to drag Ryanair profits down 5% according to management, but even that lower guidance still predicts a 7% increase in profit for the full year. The firm has been successful in ensuring its planes are nearly sold out with the its load factor expected to be 94% this year. Not only that, but Ryanair's low-cost model has made it an popular choice among travelers and passenger numbers are expected to rise by 12% this year despite the macroeconomic concerns that came with the U.K.'s exit from the European Union.
If investors are willing to wait for the Brexit turmoil to blow over, RYAAY is a great buy. Once the pound recovers, the airline's profits will see a massive boost.
Airline Stocks to Buy: Hawaiian Holdings, Inc. (HA)
Source: Bill Abbott via Flickr
If you believe that Brexit is more than just a temporary market panic, then Hawaiian Holdings, Inc. (NASDAQ: HA ) is a good play.
Hawaiian Airlines was one of the only major airlines to remain insulated from the impact of the Brexit because the company doesn't operate any flights to the U.K. Instead, HA has reaped the benefits of lower fuel costs at a time when demand for flights to Hawaii are on the rise.
While rising fuel costs will hurt HA to some extent, the company has been investing in fuel-efficient aircraft, which will help mitigate some of those expenses and its fuel hedges will keep the firm from being overwhelmed should prices rise sharply.
Hawaiian Airlines also has several opportunities for growth in the coming year. First, the company is expanding its service from Hawaii to Japan, a profitable route for the company considering the yen's improvement against the dollar.
9 Stocks That Have No More Profits Left for You
The company is also improving its premium offerings with lie-flat seats and a new bidding program that allows travelers to bid for upgrades shortly before their flights.
Airline Stocks to Buy: Delta Air Lines, Inc. (DAL)
Source: via Delta
Delta Air Lines, Inc. (NYSE: DAL ) has taken a beating this year. The firm's share price has fallen nearly 20% year-to-date and the airline's most recent earnings call showed that the company had a very disappointing summer season. Brexit worries and currency headwinds have also weighed on the company's bottom line, leaving DAL stock in a precarious position.
However, for the long-term value investors, now is a good opportunity to pick up a financially sound airline such as Delta Air Lines at a bargain price. With a price-to-earnings ratio of just 6.7%, DAL stock is relatively cheap right now and the firm's 2% dividend yield gives investors some incentive to ride out the company's rough-patch.
As big-name airlines go, DAL is in a good financial position as well, with a debt-to-equity ratio of just over 60%, far below most if its peers.
As of this writing, Laura Hoy was long RYAAY.
The post 3 Airline Stocks That Will Fly High in 2017 appeared first on InvestorPlace .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Ryanair has considerably stronger financials than other airline companies - its debt-to-equity ratio stands at just 105% compared to 125% at United Continental Holdings Inc (NYSE: UAL ) or 530% at AAL. While flagship carriers like American Airlines Group Inc (NASDAQ: AAL ) may be the first investment options that spring to mind, there are several other airline stocks that are poised to deliver impressive gains by 2017. Brexit worries have weighed on European companies and Ryanair recently issued a profit warning due to the pound's sharp decline in the aftermath of the vote, cutting its guidance by 5%, which caused many investors to abandon the airline.
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While flagship carriers like American Airlines Group Inc (NASDAQ: AAL ) may be the first investment options that spring to mind, there are several other airline stocks that are poised to deliver impressive gains by 2017. Ryanair has considerably stronger financials than other airline companies - its debt-to-equity ratio stands at just 105% compared to 125% at United Continental Holdings Inc (NYSE: UAL ) or 530% at AAL. Airline Stocks to Buy: Ryanair Holdings plc (ADR) (RYAAY) Source: Aurelijus Valeiša via Flickr (Modified) European low-cost airline Ryanair Holdings plc (ADR) (NASDAQ: RYAAY ) is a good place to start when it comes to airline investments.
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While flagship carriers like American Airlines Group Inc (NASDAQ: AAL ) may be the first investment options that spring to mind, there are several other airline stocks that are poised to deliver impressive gains by 2017. Ryanair has considerably stronger financials than other airline companies - its debt-to-equity ratio stands at just 105% compared to 125% at United Continental Holdings Inc (NYSE: UAL ) or 530% at AAL. Airline Stocks to Buy: Ryanair Holdings plc (ADR) (RYAAY) Source: Aurelijus Valeiša via Flickr (Modified) European low-cost airline Ryanair Holdings plc (ADR) (NASDAQ: RYAAY ) is a good place to start when it comes to airline investments.
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While flagship carriers like American Airlines Group Inc (NASDAQ: AAL ) may be the first investment options that spring to mind, there are several other airline stocks that are poised to deliver impressive gains by 2017. Ryanair has considerably stronger financials than other airline companies - its debt-to-equity ratio stands at just 105% compared to 125% at United Continental Holdings Inc (NYSE: UAL ) or 530% at AAL. Now is a great time to buy RYAAY as well.
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7773.0
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2016-10-25 00:00:00 UTC
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Ryder System (R) Q3 Earnings Top, Stock Falls on Weak View
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AAL
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https://www.nasdaq.com/articles/ryder-system-r-q3-earnings-top-stock-falls-on-weak-view-2016-10-25
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nan
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nan
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Ryder System Inc.R reported better-than-expected earnings and revenues in the third quarter of 2016. The transportation company's adjusted earnings per share of $1.67 beat the Zacks Consensus Estimate of $1.65. However, the bottom line declined 4% year over year.
Ryder System reported revenues of $1,724 million that surpassed the Zacks Consensus Estimate of $1,701 million. The top line also improved over 3% on a year-over-year basis. We note that Ryder System is not the only transportation company to report better-than-expected quarterly results. Sector participants like American Airlines Group AAL and United Continental Holdings UAL have also outperformed in the third quarter.
Segment Results
Fleet Management Solutions: Total revenue was flat at $1.16 billion in the third quarter. Operating revenues (revenues excluding fuel) inched up 1% year over year to $998 million.
Supply Chain Solutions: Total revenue came in at $417 million, up 8% from the year-ago quarter. Operating revenues (excluding fuel and subcontracted transportation) grew 8% year over year to $345 million.
Dedicated Transportation Solutions: Total revenue in the quarter under review was $261 million, up 15% year over year. Operating revenues (revenue excluding fuel and subcontracted transportation) increased 7% year over year to $197 million.
RYDER SYS Price, Consensus and EPS Surprise
RYDER SYS Price, Consensus and EPS Surprise | RYDER SYS Quote
Liquidity & Capital Expenditure
Ryder System exited the third quarter with cash and cash equivalents of $75 million compared with $60.9 million at year-end 2015. The company had total debt of $5,519.6 million as against $5,502.6 million at the end of 2015.
The company generated operating cash of $1.18 billion in the first nine months of 2016, up 11% year from $1.07 billion in 2015. The company maintains operating cash flow projection at $1.6 billion for 2016. Free cash flow is still expected at $200 million for the year.
Guidance
The company now expects 2016 adjusted earnings in the band of $5.70-$5.85 per share as against $5.90-$6.05 per share expected earlier. The Zacks Consensus Estimate for 2016 is pegged at $5.95 per share. The company expects fourth-quarter adjusted earnings per share in the band of $1.35-$1.50. The Zacks Consensus Estimate for the fourth quarter stands at $1.61 per share.
The dismal guidance resulted in share price decline in early trading despite the earnings beat.
Zacks Rank & a Stock to Consider
Ryder System currently carries a Zacks Rank #4 (Sell). A better-ranked stock in the transportation space is Copa Holdings CPA , which sports a Zacks Rank # 1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
For 2016, the Zacks Consensus Estimate for Copa Holdings has climbed 12 cents to $4.57 per share over the last two months.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
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COPA HLDGS SA-A (CPA): Free Stock Analysis Report
RYDER SYS (R): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Sector participants like American Airlines Group AAL and United Continental Holdings UAL have also outperformed in the third quarter. Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report RYDER SYS (R): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Segment Results Fleet Management Solutions: Total revenue was flat at $1.16 billion in the third quarter.
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Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report RYDER SYS (R): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Sector participants like American Airlines Group AAL and United Continental Holdings UAL have also outperformed in the third quarter. Operating revenues (revenue excluding fuel and subcontracted transportation) increased 7% year over year to $197 million.
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Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report RYDER SYS (R): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Sector participants like American Airlines Group AAL and United Continental Holdings UAL have also outperformed in the third quarter. Ryder System reported revenues of $1,724 million that surpassed the Zacks Consensus Estimate of $1,701 million.
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Sector participants like American Airlines Group AAL and United Continental Holdings UAL have also outperformed in the third quarter. Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report RYDER SYS (R): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Ryder System Inc.R reported better-than-expected earnings and revenues in the third quarter of 2016.
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7774.0
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2016-10-24 00:00:00 UTC
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Ford, United, American and Apple are part of Zacks Earnings Preview
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AAL
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https://www.nasdaq.com/articles/ford-united-american-and-apple-are-part-of-zacks-earnings-preview-2016-10-24
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nan
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For Immediate Release
Chicago, IL - October 24, 2016 - Zacks.com releases the list of companies likely to issue earnings surprises. This week's list includes Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) .
To see more earnings analysis, visit https://at.zacks.com/?id=3207 .
Every day, Zacks.com makes their Bull Stock of the Day available, free of charge. To see it, click here .
Earnings Growth Finally Turns Positive
The Q3 earnings season is on track to be the first quarter to show positive earnings growth after 5 quarters of back-to-back declines. The growth pace is barely in positive territory at this stage, with the aggregate Q3 earnings growth for the S&P 500 index currently at +0.1%. This growth pace will most likely improve further in the coming days, but even this low growth pace is an improvement over what we have become used to seeing in recent reporting cycles.
The growth angle isn't the only favorable aspect of the ongoing Q3 earnings season. Positive surprises are notably more numerous relative to other recent periods and estimates for the current period (2016 Q4) appear to be holding up fairly well. As we mentioned in our weekly Earnings Trends report - Is the Earnings Improvement for Real? - continuation of this trend through the rest of this earnings season will add to confidence in expectations for the coming quarters when the growth picture is expected to ramp up in a material way.
Q3 Earnings Scorecard ( as of 10/21/2016 )
We now have Q3 results from 116 S&P 500 members or 23.2% of the index's total membership that combined account for almost 30% of the index's total market capitalization. Total earnings for these 116 companies are up +3.3% from the same period last year on +1.8% higher revenues, with 80.2% beating EPS estimates and 62.9% coming ahead of revenue estimates.
This is better performance than we have seen from the same group of 116 index members in other recent periods.
The picture emerging is in-line with our modestly favorable commentary on the Q2 earnings season when we were detecting an ever-so-slight improvement in the growth picture. Earnings growth was in negative territory in Q2 - the 5th quarter in a row of earnings declines for the index - but the pace of declines was nevertheless an improvement over what we had seen in the preceding two quarters.
This gave rise to the narrative that the worst was likely behind us now on the growth front and that the picture will steadily be improving going forward. We are clearly seeing confirmation of that view in the Q3 results thus far.
Is the Improvement All Finance Driven?
As we discussed last week in Reassuring Start to Q3 Earnings Season , results from the Finance sector have been particularly positive this reporting cycle.
For the Finance sector, we now have Q3 results from almost half of the sector's total market cap in the index. Total earnings for these are up +7.9% from the same period last year on +5.1% higher revenues, with an unusually high 90% beating EPS and an almost equally high 86.7% beating revenue expectations.
This is better performance than we have seen from these Finance sector companies in a while.
Excluding the Finance sector from the aggregated reported picture at this stage, total earnings for the rest of S&P 500 members that have reported results will be up +0.8% on an equivalent revenue growth pace, with 80.2% beating EPS estimates and 62.9% beating revenue estimates.
The growth picture becomes less notable without the Finance sector, but it is still an improvement over the recent past.
Q3 Expectations as a Whole
Combining the actual results from the 116 S&P 500 members with estimates from the still-to-come 384 index members, total Q3 earnings are now expected to be up +0.1% from the same period last year on +1.5% higher revenues. This would compare to 2016 Q2 earnings growth of -2.8% on +0.2% higher revenues.
As you can see, Energy still remains the biggest drag on the aggregate growth picture, the Autos and Transportation as the other major growth laggards. Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors.
For the two biggest sectors, Technology earnings are expected to be up +1.1% on -1.0% lower revenues while Finance earnings are expected to be up +14.4% on +1.4% higher revenues. The Tech sector's weak showing is solely a function of Apple (NASDAQ: AAPL - Free Report ), which is expected to see earnings decline -19.8% from the same period last year on -9.1% lower revenues. Excluding the Apple drag, the Tech sector's earnings would be up +6.4%. A strong report from Apple on Tuesday will have a big impact on both the sector's and index's growth picture.
Expectations Beyond Q3
The chart below shows current bottom-up consensus earnings expectations for the index in 2016 Q3 and the following four quarters contrasted with actual results in the preceding four quarters. Please note that the columns represent bottom-up earnings totals for each quarter in billions of dollars while the line represents the quarterly growth rates. At the start of the Q3 earnings season, growth was expected to be in negative territory in Q3 for the 6th quarter in a row, with positive growth expected to resume from Q4 (+5.1%) onwards. But as indicated at the top, growth in Q3 has turned positive already (up +0.1%).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This week's list includes Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors. Get the full Report on F - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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This week's list includes Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors. Click to get this free report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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This week's list includes Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Get the full Report on F - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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Click to get this free report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here. This week's list includes Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors.
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7775.0
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2016-10-21 00:00:00 UTC
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Spirit Airlines (SAVE) Q3 Earnings: Another Beat in Store?
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AAL
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https://www.nasdaq.com/articles/spirit-airlines-save-q3-earnings%3A-another-beat-in-store-2016-10-21
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nan
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nan
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We expect Miramar, FL-based Spirit AirlinesSAVE to report better-than-expected earnings in the third quarter of 2016. The carrier will release its results on Oct 25, before the market opens.
In the second quarter, the carrier had reported a positive earnings surprise of 3.74%. Results were aided by low oil prices . Moreover, earnings improved 7.8% on a year-over-year basis. Average economic fuel price per gallon declined 29.3% to $1.47. The carrier has an impressive track record with respect to earnings per share. Spirit Airlines outpaced the Zacks Consensus Estimate in each of the last four quarters with an average beat of 4.35%.
We expect another bottom-line outperformance this quarter. An earnings beat should not be too difficult as the Zacks Consensus Estimate for the third quarter of 2016 is $1.10 per share, well below the year-ago estimate of $1.28.
SPIRIT AIRLINES Price and EPS Surprise
SPIRIT AIRLINES Price and EPS Surprise | SPIRIT AIRLINES Quote
Earnings Whispers
Our quantitative model shows that Spirit Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
Zacks ESP: The Earnings ESP for Spirit Airlines is +1.82% with the Most Accurate estimate exceeding the Zacks Consensus Estimate by 2 cents.
Zacks Rank: Spirit Airlines carries a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating earnings estimates. Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
The combination of Spirit Airlines' Zacks Rank #3 and a positive ESP makes us reasonably confident of an earnings beat.
What is Driving the Better-than-Expected Earnings?
The most favorable development in the third quarter was the U.S. Department of Transportation's final approval to Spirit Airlines and seven other carriers, including United Continental Holdings UAL and American Airlines Group AAL , to initiate commercial flights to Havana. We are positive on the decision, which came on Aug 31, as Havana is a favorite tourist spot. We expect a detailed commentary on the issue at the third-quarter conference call.
We also appreciate Spirit Airlines' efforts to reward its shareholders. Moreover, its constant efforts to expand and modernize its fleet are encouraging. In addition, we expect the bottom-line performance in the third quarter to be aided by low fuel costs. The company expects fuel price (inclusive of all cash settled hedges) to be $1.56 per gallon, well below the year-ago figure.
Though the company continues to face difficulties in terms of top-line growth, we are encouraged by the improved third-quarter forecast for total revenue per available seat mile (TRASM: a key measure of unit revenue). The carrier now expects the metric to decline approximately 7% (the earlier projection had called for a decline of approximately 9%).
Another Stock to Consider
Here is another transportation company you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat this quarter:
Navios Maritime Holdings Inc. NM has an Earnings ESP of +15.39% and a Zacks Rank #2. The company is expected to report third-quarter earnings on Nov 28. You can see the complete list of today's Zacks #1 Rank stocks here .
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NAVIOS MARI HLD (NM): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
SPIRIT AIRLINES (SAVE): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The most favorable development in the third quarter was the U.S. Department of Transportation's final approval to Spirit Airlines and seven other carriers, including United Continental Holdings UAL and American Airlines Group AAL , to initiate commercial flights to Havana. Click to get this free report NAVIOS MARI HLD (NM): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The combination of Spirit Airlines' Zacks Rank #3 and a positive ESP makes us reasonably confident of an earnings beat.
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Click to get this free report NAVIOS MARI HLD (NM): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The most favorable development in the third quarter was the U.S. Department of Transportation's final approval to Spirit Airlines and seven other carriers, including United Continental Holdings UAL and American Airlines Group AAL , to initiate commercial flights to Havana. SPIRIT AIRLINES Price and EPS Surprise SPIRIT AIRLINES Price and EPS Surprise | SPIRIT AIRLINES Quote Earnings Whispers Our quantitative model shows that Spirit Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
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Click to get this free report NAVIOS MARI HLD (NM): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The most favorable development in the third quarter was the U.S. Department of Transportation's final approval to Spirit Airlines and seven other carriers, including United Continental Holdings UAL and American Airlines Group AAL , to initiate commercial flights to Havana. SPIRIT AIRLINES Price and EPS Surprise SPIRIT AIRLINES Price and EPS Surprise | SPIRIT AIRLINES Quote Earnings Whispers Our quantitative model shows that Spirit Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
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The most favorable development in the third quarter was the U.S. Department of Transportation's final approval to Spirit Airlines and seven other carriers, including United Continental Holdings UAL and American Airlines Group AAL , to initiate commercial flights to Havana. Click to get this free report NAVIOS MARI HLD (NM): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report SPIRIT AIRLINES (SAVE): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. In the second quarter, the carrier had reported a positive earnings surprise of 3.74%.
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7776.0
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2016-10-21 00:00:00 UTC
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Earnings Growth Finally Turns Positive
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AAL
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https://www.nasdaq.com/articles/earnings-growth-finally-turns-positive-2016-10-21
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nan
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nan
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The Q3 earnings season is on track to be the first quarter to show positive earnings growth after 5 quarters of back-to-back declines. The growth pace is barely in positive territory at this stage, with the aggregate Q3 earnings growth for the S&P 500 index currently at +0.1%. This growth pace will most likely improve further in the coming days, but even this low growth pace is an improvement over what we have become used to seeing in recent reporting cycles.
The chart below shows the evolving Q3 earnings growth for the S&P 500 index contrasted with declines in the preceding 5 quarters and expectations of positive growth in Q4. Please note that the +0.1% earnings growth for Q3 compares to the -2.9% decline expected in earnings at the start of this month.
The growth angle isn't the only favorable aspect of the ongoing Q3 earnings season. Positive surprises are notably more numerous relative to other recent periods and estimates for the current period (2016 Q4) appear to be holding up fairly well. As we mentioned in our weekly Earnings Trends report - Is the Earnings Improvement for Real? - continuation of this trend through the rest of this earnings season will add to confidence in expectations for the coming quarters when the growth picture is expected to ramp up in a material way.
Q3 Earnings Scorecard ( as of 10/21/2016 )
We now have Q3 results from 116 S&P 500 members or 23.2% of the index's total membership that combined account for almost 30% of the index's total market capitalization. Total earnings for these 116 companies are up +3.3% from the same period last year on +1.8% higher revenues, with 80.2% beating EPS estimates and 62.9% coming ahead of revenue estimates.
The table below shows the scorecard of these 116 index members. The reporting cycle really ramps up this week, with more than 800 companies reporting results, including 171 S&P 500 members. By the end of this week, we will have seen Q3 results from 57% of the index's total membership.
The picture emerging from the above comparison chart is in-line with our modestly favorable commentary on the Q2 earnings season when we were detecting an ever-so-slight improvement in the growth picture. Earnings growth was in negative territory in Q2 - the 5th quarter in a row of earnings declines for the index - but the pace of declines was nevertheless an improvement over what we had seen in the preceding two quarters.
This gave rise to the narrative that the worst was likely behind us now on the growth front and that the picture will steadily be improving going forward. We are clearly seeing confirmation of that view in the Q3 results thus far.
Is the Improvement All Finance Driven?
As we discussed last week in Reassuring Start to Q3 Earnings Season , results from the Finance sector have been particularly positive this reporting cycle.
For the Finance sector, we now have Q3 results from almost half of the sector's total market cap in the index. Total earnings for these are up +7.9% from the same period last year on +5.1% higher revenues, with an unusually high 90% beating EPS and an almost equally high 86.7% beating revenue expectations.
This is better performance than we have seen from these Finance sector companies in a while, as the below comparison charts show.
Excluding the Finance sector from the aggregated reported picture at this stage, total earnings for the rest of S&P 500 members that have reported results will be up +0.8% on an equivalent revenue growth pace, with 80.2% beating EPS estimates and 62.9% beating revenue estimates.
The comparison charts below show the aggregate reported growth picture, with and without the Finance sector.
What the above chart shows is that the growth picture becomes less notable without the Finance sector, but it is still an improvement over the recent past.
Q3 Expectations As a Whole
Combining the actual results from the 116 S&P 500 members with estimates from the still-to-come 384 index members, total Q3 earnings are now expected to be up +0.1% from the same period last year on +1.5% higher revenues. This would compare to 2016 Q2 earnings growth of -2.8% on +0.2% higher revenues.
The table below shows the summary picture for Q3 earnings, revenues and margins contrasted with the corresponding results from Q2.
As you can see, Energy still remains the biggest drag on the aggregate growth picture, the Autos and Transportation as the other major growth laggards. Tough comparisons at Ford ( F ) and the air carriers, particularly United ( UAL ) and American ( AAL ), explain the growth issues in those two sectors.
For the two biggest sectors, Technology earnings are expected to be up +1.1% on -1.0% lower revenues while Finance earnings are expected to be up +14.4% on +1.4% higher revenues. The Tech sector's weak showing is solely a function of Apple ( AAPL ), which is expected to see earnings decline -19.8% from the same period last year on -9.1% lower revenues. Excluding the Apple drag, the Tech sector's earnings would be up +6.4%. A strong report from Apple on Tuesday will have a big impact on both the sector's and index's growth picture.
Expectations Beyond Q3
The chart below shows current bottom-up consensus earnings expectations for the index in 2016 Q3 and the following four quarters contrasted with actual results in the preceding four quarters. Please note that the columns represent bottom-up earnings totals for each quarter in billions of dollars while the line represents the quarterly growth rates. At the start of the Q3 earnings season, growth was expected to be in negative territory in Q3 for the 6th quarter in a row, with positive growth expected to resume from Q4 (+5.1%) onwards. But as indicated at the top, growth in Q3 has turned positive already (up +0.1%).
The improved Energy sector outlook makes sense, given shifting comparisons and the recent momentum in oil prices . But we will have to wait to find out if estimates for the other sectors will hold up as companies report Q3 results and provide guidance for Q4 and beyond.
It will be interesting to see if the decelerated pace of negative revisions that we saw the last earnings season will get repeated this time as well.
Note : Sheraz Mian regularly provides earnings analysis on Zacks.com and appears frequently in the print and electronic media. In addition to this Earnings Preview article, he publishes the Zacks Earnings Trends report every week.
If you want an email notification each time Sheraz publishes a new article, pleaseclick here >>>
Here is a list of the 810 companies reporting this week, including 171 S&P 500 member.
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UNITED CONT HLD (UAL): Free Stock Analysis Report
FORD MOTOR CO (F): Free Stock Analysis Report
APPLE INC (AAPL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Tough comparisons at Ford ( F ) and the air carriers, particularly United ( UAL ) and American ( AAL ), explain the growth issues in those two sectors. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The Tech sector's weak showing is solely a function of Apple ( AAPL ), which is expected to see earnings decline -19.8% from the same period last year on -9.1% lower revenues.
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Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Tough comparisons at Ford ( F ) and the air carriers, particularly United ( UAL ) and American ( AAL ), explain the growth issues in those two sectors. Total earnings for these 116 companies are up +3.3% from the same period last year on +1.8% higher revenues, with 80.2% beating EPS estimates and 62.9% coming ahead of revenue estimates.
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Tough comparisons at Ford ( F ) and the air carriers, particularly United ( UAL ) and American ( AAL ), explain the growth issues in those two sectors. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The chart below shows the evolving Q3 earnings growth for the S&P 500 index contrasted with declines in the preceding 5 quarters and expectations of positive growth in Q4.
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Tough comparisons at Ford ( F ) and the air carriers, particularly United ( UAL ) and American ( AAL ), explain the growth issues in those two sectors. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Excluding the Finance sector from the aggregated reported picture at this stage, total earnings for the rest of S&P 500 members that have reported results will be up +0.8% on an equivalent revenue growth pace, with 80.2% beating EPS estimates and 62.9% beating revenue estimates.
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7777.0
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2016-10-20 00:00:00 UTC
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Jobless Claims, Draghi Speaks, More Q3 Earnings
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AAL
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https://www.nasdaq.com/articles/jobless-claims-draghi-speaks-more-q3-earnings-2016-10-20
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nan
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nan
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Thursday, October 20, 2016
Weekly Initial Jobless Claims, a news conference with ECB President Mario Draghi and a fresh crop of Q3 earnings results are on tap before the bell this morning. The finance-heavy early earnings season has shown some real progress in pushing out of a 5-month-long earnings recession.
Jobless claims for the week rose 13K to 260K, and last week was revised up 1000 claims to 247K, which is an historically low read. Though we've not broken through the 250-275K range to the downside, doing so is a very rare feat. Continuing claims were also historically low at 2.057 million. All signs point to continuing strength in the U.S. labor market.
Mario Draghi, President of the European Central Bank, has issued some quotes in his speech today regarding policy for helping strengthen the European Union (EU) going forward. He expects "inflation to rise gradually" in the coming months, and that the central bank "will use all instruments," "preserving substantial monetary support," even though the "baseline scenario is subject to downside risk." The euro spiked above $1.10 following the comments, but remains historically low, as well.
Verizon VZ posting Q3 earnings of $1.01 per share on $30.9 billion in sales. This is a beat of 2 cents on EPS but a slight miss on the top line. Net adds in the quarter reached 442K, but both earnings and revenues are down single digits year over year.
Walgreens Boots Alliance WBA brought in $1.07 per share on $28.6 billion for its Q3. Again this is a mixed result, with an 8-cent positive surprise on the bottom line but a miss on sales. Walgreens has not posted an earnings miss for at least the last 5 quarters.
Travelers Insurance TRV topped expectations on both top and bottom lines, its $2.45 per share and $6.96 billion surpassing the $2.37 and $6.76 billion, respectively. Earnings remain down year over year, but revenues have gained since Q3 2015.
American Airlines AAL clobbered expectations on earnings, posting $2.80 versus the $1.66 in the Zacks consensus estimate. Sales beat, too, albeit slightly: $10.59 billion over $10.55 billion, down 1% year over year. The airline sector is currently in the bottom 15% of all sectors in the Zacks consensus.
Finally, Dunkin Donuts DNKN posted a mixed Q3 report, beating by 2 cents to 60 cents per share on $207 million in sales, down roughly $6 million from what was expected. Earnings year over year for Dunkin has risen to low double-digits, though revenues are roughly flat from a year ago.
Insofar as Q3 earnings season is reflecting relative strength from previous quarters, a much more comprehensive analysis on the prospect of Q3 earnings gains can be found in Zacks Director of Researvh Sheraz Mian's latest Earnings Trends report: Is the Earnings Recession for Real?
Mark Vickery
Senior Editor
Click here to follow this author>>
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VERIZON COMM (VZ): Free Stock Analysis Report
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To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL clobbered expectations on earnings, posting $2.80 versus the $1.66 in the Zacks consensus estimate. Click to get this free report VERIZON COMM (VZ): Free Stock Analysis Report TRAVELERS COS (TRV): Free Stock Analysis Report WALGREENS BAI (WBA): Free Stock Analysis Report DUNKIN BRANDS (DNKN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Thursday, October 20, 2016 Weekly Initial Jobless Claims, a news conference with ECB President Mario Draghi and a fresh crop of Q3 earnings results are on tap before the bell this morning.
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Click to get this free report VERIZON COMM (VZ): Free Stock Analysis Report TRAVELERS COS (TRV): Free Stock Analysis Report WALGREENS BAI (WBA): Free Stock Analysis Report DUNKIN BRANDS (DNKN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines AAL clobbered expectations on earnings, posting $2.80 versus the $1.66 in the Zacks consensus estimate. Travelers Insurance TRV topped expectations on both top and bottom lines, its $2.45 per share and $6.96 billion surpassing the $2.37 and $6.76 billion, respectively.
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Click to get this free report VERIZON COMM (VZ): Free Stock Analysis Report TRAVELERS COS (TRV): Free Stock Analysis Report WALGREENS BAI (WBA): Free Stock Analysis Report DUNKIN BRANDS (DNKN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines AAL clobbered expectations on earnings, posting $2.80 versus the $1.66 in the Zacks consensus estimate. Earnings year over year for Dunkin has risen to low double-digits, though revenues are roughly flat from a year ago.
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American Airlines AAL clobbered expectations on earnings, posting $2.80 versus the $1.66 in the Zacks consensus estimate. Click to get this free report VERIZON COMM (VZ): Free Stock Analysis Report TRAVELERS COS (TRV): Free Stock Analysis Report WALGREENS BAI (WBA): Free Stock Analysis Report DUNKIN BRANDS (DNKN): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Walgreens has not posted an earnings miss for at least the last 5 quarters.
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7778.0
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2016-10-20 00:00:00 UTC
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American Airlines Group (AAL) Beats on Q3 Earnings
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-aal-beats-on-q3-earnings-2016-10-20
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nan
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nan
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American Airlines GroupAAL came into existence following the Dec 2013 merger of AMR (American Airlines' parent group) and US Airways. The Fort Worth, Texas based company serves customers with more than 6,700 daily flights in more than 50 nations across the globe.
American Airlines Group has a healthy track record with respect to earnings. The company has delivered positive earnings surprises in each of the last four quarters, with an average beat of 4.27%.
Zacks Rank : Currently, American Airlines Group has a Zacks Rank #3 (Hold), but that could change following the company's earnings report which was just released. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
We have highlighted some of the key stats from this just-revealed announcement below:
Earnings : American Airlines Group beat on earnings. Adjusted earnings per share came in at $2.80, easily beating the Zacks Consensus Estimate of $1.68. Quarterly earnings increased over 1% on a year over year basis.
AMER AIRLINES Price and EPS Surprise
AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote
Revenue : Revenues of $10,594 million were 1.1% below the year-ago figure. Quarterly revenues edged past the Zacks Consensus Estimate of $10,549 million.
Key Stats : American Airlines Group's results in the quarter benefited from low fuel costs. However, higher labor costs hurt the bottom line. During the quarter, the company returned $669 million billion to its shareholders through the payment of $53 million in dividends and buyback of shares worth $616. Furthermore, the carrier also declared a dividend of $0.10 per share. The dividend will be paid on Nov 21, 2016, to the shareholders on Nov 7. We are impressed by the company's efforts to reward shareholders through stock repurchases and dividend payments.
Stock Price : The earnings beat pleased investors. Consequently, shares of the company were up in pre-market trading at the time of writing.
Check back later for our full write up on this American Airlines Group earnings report later!
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AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines GroupAAL came into existence following the Dec 2013 merger of AMR (American Airlines' parent group) and US Airways. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The Fort Worth, Texas based company serves customers with more than 6,700 daily flights in more than 50 nations across the globe.
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Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines GroupAAL came into existence following the Dec 2013 merger of AMR (American Airlines' parent group) and US Airways. We have highlighted some of the key stats from this just-revealed announcement below: Earnings : American Airlines Group beat on earnings.
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American Airlines GroupAAL came into existence following the Dec 2013 merger of AMR (American Airlines' parent group) and US Airways. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Rank : Currently, American Airlines Group has a Zacks Rank #3 (Hold), but that could change following the company's earnings report which was just released.
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American Airlines GroupAAL came into existence following the Dec 2013 merger of AMR (American Airlines' parent group) and US Airways. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Rank : Currently, American Airlines Group has a Zacks Rank #3 (Hold), but that could change following the company's earnings report which was just released.
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7779.0
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2016-10-20 00:00:00 UTC
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American Airlines (AAL) Beats on Q3 Earnings & Revenues
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https://www.nasdaq.com/articles/american-airlines-aal-beats-on-q3-earnings-revenues-2016-10-20
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American Airlines Group Inc.AAL reported better-than-expected earnings in the third quarter of 2016. The company posted adjusted earnings per share of $2.80 that comfortably beat the Zacks Consensus Estimate of $1.68. Quarterly earnings increased more than 1% year over year.
Revenues of $10,594 million were 1.1% below the year-ago figure but edged past the Zacks Consensus Estimate of $10,549 million. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings UAL and Alaska Air Group ALK have also reported better-than-expected earnings and revenues in the third quarter.
Consolidated passenger revenue per available seat mile (PRASM) declined 3.3% to 12.72 cents in the reported quarter. Consolidated yield dipped 0.6% to 15.27 cents. Total revenue per available seat mile declined 2.2% to 14.73 cents. Traffic was down 1.6%, whereas capacity was up 1.2%. This resulted in relatively empty planes. Consolidated load factor (percentage of seats filled by passengers) declined as traffic contracted while capacity expanded. Load factor deteriorated to 83.3% from the comparable year-ago figure of 85.6%.
Total operating expenses at American Airlines rose 5.2% to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company and an $86 million accrual pertaining to the carrier's profit sharing program contributed to the increase in expenses.
During the quarter, the company returned $669 million billion to its shareholders through dividends of $53 million and share buyback worth $616. Furthermore, the carrier declared a dividend of 10 cents per share. The dividend will be paid on Nov 21, to shareholders on record as of Nov 7, 2016. The carrier has returned more than $9 billion to stockholders through share repurchases and dividends since mid-2014. We are impressed by the company's shareholder-friendly initiatives.
American Airlines remains focused on introducing new aircraft and retiring old ones from its fleet. In keeping with its aim to modernize its fleet, the carrier took delivery of 12 new mainline aircraft and nine regional ones during the reported quarter. It also retired 49 aircraft in the same quarter. The carrier invested $1 billion toward new aircraft during the quarter.
AMER AIRLINES Price, Consensus and EPS Surprise
AMER AIRLINES Price, Consensus and EPS Surprise | AMER AIRLINES Quote
Zacks Rank & a Key Pick
Currently, American Airlines Group has a Zacks Rank #3 (Hold). A better-ranked stock in the transportation space is Copa Holdings CPA , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
For 2016, the Zacks Consensus Estimate for Copa Holdings has climbed 12 cents to $4.57 per share over the last month.
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Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
COPA HLDGS SA-A (CPA): Free Stock Analysis Report
ALASKA AIR GRP (ALK): Free Stock Analysis Report
UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc.AAL reported better-than-expected earnings in the third quarter of 2016. Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings UAL and Alaska Air Group ALK have also reported better-than-expected earnings and revenues in the third quarter.
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Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group Inc.AAL reported better-than-expected earnings in the third quarter of 2016. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings UAL and Alaska Air Group ALK have also reported better-than-expected earnings and revenues in the third quarter.
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Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group Inc.AAL reported better-than-expected earnings in the third quarter of 2016. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings UAL and Alaska Air Group ALK have also reported better-than-expected earnings and revenues in the third quarter.
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American Airlines Group Inc.AAL reported better-than-expected earnings in the third quarter of 2016. Click to get this free report COPA HLDGS SA-A (CPA): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Furthermore, the carrier declared a dividend of 10 cents per share.
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7780.0
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2016-10-19 00:00:00 UTC
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Thursday's Top Earnings Charts
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AAL
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https://www.nasdaq.com/articles/thursdays-top-earnings-charts-2016-10-19
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One of the biggest questions of earnings season is: will a company beat or miss?
This week's best earnings charts include companies who have perfect earnings surprise track records. They haven't missed in years.
Despite what you might think, it's not easy for companies to beat every quarter for years on end. Only a couple dozen companies are able to do it.
Here are three doing it this week:
1. American Airlines (AAL) has only been public again for a few years but it has strung together an impressive track record.
2. Lithia Motors (LAD) has been one of the best performing stocks over the last 5 years. It also has managed to beat the Zacks Consensus Estimate every single quarter. Will it do it again this quarter?
3. PayPal (PYPL) was spun off from eBay just a year ago. In that time, it has managed to surprise on the earnings four quarters in a row. But it hasn't been smooth sailing on the shares.
What else should you know about these earnings charts? Tune into the short video to find out.
Interested in Trading Options During the Earnings Season?
Dave Bartosiak dives into the options trade for Advance Micro Devices.
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Would you like to access Zacks' 2 best trades that are not available to the public? Zacks Executive VP, Steve Reitmeister knows which of our experts has the hottest hand and when key trades are about to be triggered. Today he is prepared to pass the Best of Our Best along to you. See these timely buys now >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
LITHIA MOTORS (LAD): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (AAL) has only been public again for a few years but it has strung together an impressive track record. Click to get this free report LITHIA MOTORS (LAD): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report To read this article on Zacks.com click here. Dave Bartosiak dives into the options trade for Advance Micro Devices.
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Click to get this free report LITHIA MOTORS (LAD): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines (AAL) has only been public again for a few years but it has strung together an impressive track record. This week's best earnings charts include companies who have perfect earnings surprise track records.
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Click to get this free report LITHIA MOTORS (LAD): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines (AAL) has only been public again for a few years but it has strung together an impressive track record. This week's best earnings charts include companies who have perfect earnings surprise track records.
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American Airlines (AAL) has only been public again for a few years but it has strung together an impressive track record. Click to get this free report LITHIA MOTORS (LAD): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report To read this article on Zacks.com click here. This week's best earnings charts include companies who have perfect earnings surprise track records.
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7781.0
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2016-10-19 00:00:00 UTC
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Transport Stock Earnings Slated on Oct 20: AAL, UNP & More
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AAL
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https://www.nasdaq.com/articles/transport-stock-earnings-slated-on-oct-20%3A-aal-unp-more-2016-10-19
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The Q3 earnings season has started on a positive note and has added to the prevailing optimism in the market. Several key sectors such as Banking and Industrial Production have seen a growth in earnings for companies that have reported last week end. So far, 34 S&P 500 members have reported their quarterly results. Going by their quarterly numbers, we note that earnings and revenues have inched up 1.3% and 2.9%, respectively, on a year-over-year basis.
The transportation sector, however, appears to be lagging behind on the earnings front. With 20% of the transportation companies having reported earnings as of Oct 14, we observed a year-over-year decline of 3.3% in earnings. Nonetheless, revenues have grown 5.8% year over year. Notably, all companies beat earnings estimates and 66.7% surpassed revenue expectations. Outlook for the transportation sector this quarter is not very encouraging either with earnings expected to be down by 19.8% from the prior-year quarter.
With more companies slated to release their financial numbers this week, we expect a clearer insight into the performance of the sector. Meanwhile, let's take a look at these four transportation companies that are scheduled to report their Q3 numbers on Oct 20.
American Airlines Group Inc.AAL is a leading U.S. airline company with a widespread global network. According to our proven model, a company needs the right combination of two key ingredients - a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or atleast 3 (Hold) - to increase the odds of an earnings surprise. The company carries a Zacks Rank #3 and an Earnings ESP of +3.01% (Most Accurate estimate stands at $1.71 while the Zacks Consensus Estimate is pegged at $1.66), which makes us reasonably confident of an earnings beat (Read more: American Airlines Q3 Earnings: A Beat in the Cards?).
AMER AIRLINES Price and EPS Surprise
AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote
Union Pacific Corp.UNP is a renowned U.S. Class 1 railroad company. The company also has other business segments including trucks business. It carries a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .
The company has an Earnings ESP of 0.00% because both the Zacks Consensus Estimate and Most Accurate Estimate are pegged at $1.39. Despite the company's favorable Zacks Ranks, its 0.00% ESP complicates our surprise prediction (Read more: Union Pacific Q3 Earnings: Is a Surprise in Store?).
UNION PAC CORP Price and EPS Surprise
UNION PAC CORP Price and EPS Surprise | UNION PAC CORP Quote
GATX Corp.GATX is a finance and leasing company catering to the transportation sector. It carries a Zacks Rank #3. The company's Earnings ESP is pegged at -3.01% as Most Accurate estimate stands at $1.29 while the Zacks Consensus Estimate is of $1.33. This makes our surprise prediction inconclusive. However, it should be noted that the company has managed to pull an earnings surprise in each of the last four quarters with an average beat of 16.56%.
GATX CORP Price and EPS Surprise
GATX CORP Price and EPS Surprise | GATX CORP Quote
Werner Enterprises, Inc.WERN is a transportation company with operations across the U.S. The company carries a Zacks Rank #4 (Sell) and has an Earnings ESP of -7.69%. This is because Most Accurate estimate of 24 cents is lower than the Zacks Consensus Estimate pegged at 26 cents. Please note, we caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
WERNER ENTRPRS Price and EPS Surprise
WERNER ENTRPRS Price and EPS Surprise | WERNER ENTRPRS Quote
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
UNION PAC CORP (UNP): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
GATX CORP (GATX): Free Stock Analysis Report
WERNER ENTRPRS (WERN): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc.AAL is a leading U.S. airline company with a widespread global network. Click to get this free report UNION PAC CORP (UNP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report GATX CORP (GATX): Free Stock Analysis Report WERNER ENTRPRS (WERN): Free Stock Analysis Report To read this article on Zacks.com click here. Several key sectors such as Banking and Industrial Production have seen a growth in earnings for companies that have reported last week end.
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Click to get this free report UNION PAC CORP (UNP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report GATX CORP (GATX): Free Stock Analysis Report WERNER ENTRPRS (WERN): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group Inc.AAL is a leading U.S. airline company with a widespread global network. AMER AIRLINES Price and EPS Surprise AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote Union Pacific Corp.UNP is a renowned U.S. Class 1 railroad company.
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Click to get this free report UNION PAC CORP (UNP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report GATX CORP (GATX): Free Stock Analysis Report WERNER ENTRPRS (WERN): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group Inc.AAL is a leading U.S. airline company with a widespread global network. The company carries a Zacks Rank #3 and an Earnings ESP of +3.01% (Most Accurate estimate stands at $1.71 while the Zacks Consensus Estimate is pegged at $1.66), which makes us reasonably confident of an earnings beat (Read more: American Airlines Q3 Earnings: A Beat in the Cards?).
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American Airlines Group Inc.AAL is a leading U.S. airline company with a widespread global network. Click to get this free report UNION PAC CORP (UNP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report GATX CORP (GATX): Free Stock Analysis Report WERNER ENTRPRS (WERN): Free Stock Analysis Report To read this article on Zacks.com click here. Notably, all companies beat earnings estimates and 66.7% surpassed revenue expectations.
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7782.0
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2016-10-19 00:00:00 UTC
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Pre-Market Earnings Report for October 20, 2016 : VZ, WBA, UNP, DHR, BK, ITW, TRV, PLD, PPG, AAL, FITB, NUE
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AAL
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https://www.nasdaq.com/articles/pre-market-earnings-report-october-20-2016-vz-wba-unp-dhr-bk-itw-trv-pld-ppg-aal-fitb-nue
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The following companies are expected to report earnings prior to market open on 10/20/2016. Visit our Earnings Calendar for a full list of expected earnings releases.
Verizon Communications Inc. ( VZ ) is reporting for the quarter ending September 30, 2016. The wireless (national) company's consensus earnings per share forecast from the 14 analysts that follow the stock is $0.99. This value represents a 4.81% decrease compared to the same quarter last year. In the past year VZ has met analyst expectations once and beat the expectations the other three quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for VZ is 12.86 vs. an industry ratio of 18.30.
Walgreens Boots Alliance, Inc. ( WBA ) is reporting for the quarter ending August 31, 2016. The drug store company's consensus earnings per share forecast from the 12 analysts that follow the stock is $0.99. This value represents a 12.50% increase compared to the same quarter last year. In the past year WBA and beat the expectations the other three quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for WBA is 17.31 vs. an industry ratio of 23.20.
Union Pacific Corporation ( UNP ) is reporting for the quarter ending September 30, 2016. The transportation (rail) company's consensus earnings per share forecast from the 13 analysts that follow the stock is $1.39. This value represents a 7.33% decrease compared to the same quarter last year. UNP missed the consensus earnings per share in the 4th calendar quarter of 2015 by -8.39%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for UNP is 19.04 vs. an industry ratio of 17.90, implying that they will have a higher earnings growth than their competitors in the same industry.
Danaher Corporation ( DHR ) is reporting for the quarter ending September 30, 2016. The diversified operations company's consensus earnings per share forecast from the 10 analysts that follow the stock is $0.82. This value represents a 21.90% decrease compared to the same quarter last year. In the past year DHR has met analyst expectations once and beat the expectations the other three quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for DHR is 21.53 vs. an industry ratio of 21.10, implying that they will have a higher earnings growth than their competitors in the same industry.
Bank Of New York Mellon Corporation ( BK ) is reporting for the quarter ending September 30, 2016. The bank company's consensus earnings per share forecast from the 8 analysts that follow the stock is $0.81. This value represents a 9.46% increase compared to the same quarter last year. In the past year BK has beat the expectations every quarter. The highest one was in the 2nd calendar quarter where they beat the consensus by 1.33%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for BK is 13.17 vs. an industry ratio of 13.30.
Illinois Tool Works Inc. ( ITW ) is reporting for the quarter ending September 30, 2016. The machinery company's consensus earnings per share forecast from the 10 analysts that follow the stock is $1.49. This value represents a 7.19% increase compared to the same quarter last year. In the past year ITW has beat the expectations every quarter. The highest one was in the 2nd calendar quarter where they beat the consensus by 4.29%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for ITW is 20.44 vs. an industry ratio of 20.60.
The Travelers Companies, Inc. ( TRV ) is reporting for the quarter ending September 30, 2016. The insurance (property & casualty) company's consensus earnings per share forecast from the 10 analysts that follow the stock is $2.37. This value represents a 19.11% decrease compared to the same quarter last year. TRV missed the consensus earnings per share in the 1st calendar quarter of 2016 by -9.34%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for TRV is 12.04 vs. an industry ratio of 17.00.
ProLogis, Inc. ( PLD ) is reporting for the quarter ending September 30, 2016. The reit company's consensus earnings per share forecast from the 13 analysts that follow the stock is $0.70. This value represents a 20.69% increase compared to the same quarter last year. In the past year PLD has met analyst expectations once and beat the expectations the other three quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for PLD is 20.26 vs. an industry ratio of 14.60, implying that they will have a higher earnings growth than their competitors in the same industry.
PPG Industries, Inc. ( PPG ) is reporting for the quarter ending September 30, 2016. The chemical company's consensus earnings per share forecast from the 11 analysts that follow the stock is $1.56. This value represents a 3.11% decrease compared to the same quarter last year. In the past year PPG has met analyst expectations twice and beat the expectations the other two quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for PPG is 15.52 vs. an industry ratio of 14.10, implying that they will have a higher earnings growth than their competitors in the same industry.
American Airlines Group, Inc. ( AAL ) is reporting for the quarter ending September 30, 2016. The airline company's consensus earnings per share forecast from the 9 analysts that follow the stock is $1.66. This value represents a 40.07% decrease compared to the same quarter last year. In the past year AAL has beat the expectations every quarter. The highest one was in the 2nd calendar quarter where they beat the consensus by 7.27%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for AAL is 7.25 vs. an industry ratio of 20.80.
Fifth Third Bancorp ( FITB ) is reporting for the quarter ending September 30, 2016. The bank company's consensus earnings per share forecast from the 12 analysts that follow the stock is $0.41. This value represents a 8.89% decrease compared to the same quarter last year. In the past year FITB has met analyst expectations once and beat the expectations the other three quarters. Zacks Investment Research reports that the 2016 Price to Earnings ratio for FITB is 12.27 vs. an industry ratio of 13.30.
Nucor Corporation ( NUE ) is reporting for the quarter ending September 30, 2016. The steel company's consensus earnings per share forecast from the 6 analysts that follow the stock is $0.90. This value represents a 26.76% increase compared to the same quarter last year. NUE missed the consensus earnings per share in the 1st calendar quarter of 2016 by -18.52%. Zacks Investment Research reports that the 2016 Price to Earnings ratio for NUE is 19.09 vs. an industry ratio of 16.00, implying that they will have a higher earnings growth than their competitors in the same industry.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group, Inc. ( AAL ) is reporting for the quarter ending September 30, 2016. In the past year AAL has beat the expectations every quarter. Zacks Investment Research reports that the 2016 Price to Earnings ratio for AAL is 7.25 vs. an industry ratio of 20.80.
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American Airlines Group, Inc. ( AAL ) is reporting for the quarter ending September 30, 2016. In the past year AAL has beat the expectations every quarter. Zacks Investment Research reports that the 2016 Price to Earnings ratio for AAL is 7.25 vs. an industry ratio of 20.80.
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American Airlines Group, Inc. ( AAL ) is reporting for the quarter ending September 30, 2016. In the past year AAL has beat the expectations every quarter. Zacks Investment Research reports that the 2016 Price to Earnings ratio for AAL is 7.25 vs. an industry ratio of 20.80.
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In the past year AAL has beat the expectations every quarter. American Airlines Group, Inc. ( AAL ) is reporting for the quarter ending September 30, 2016. Zacks Investment Research reports that the 2016 Price to Earnings ratio for AAL is 7.25 vs. an industry ratio of 20.80.
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7783.0
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2016-10-19 00:00:00 UTC
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Market Close Report: NASDAQ Composite index closes at 5,246.41 up 2.57 points
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AAL
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https://www.nasdaq.com/articles/market-close-report-nasdaq-composite-index-closes-524641-257-points-2016-10-19
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Wednesday's session closes with the NASDAQ Composite Index at 5,246.41. The total shares traded for the NASDAQ was over 1.57 billion.
Advancers stocks led declining by 1.51 to 1 ratio. There were 1695 advancers and 1124 decliners for the day. On the NASDAQ Stock Exchange 40 stocks reached a 52 week high and 30 reaching lows. The most active, advancers, decliners, unusual volume and most active by dollar volume can be monitored intraday on the Most Active Stocks page.
The NASDAQ 100 index closed down -.06% for the day; a total of -3.11 points. The current value is 4,836.61. Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Airlines Group, Inc. ( AAL ) had the largest percent change gain rising 3.25%.
The Dow Jones index closed up .22% for the day; a total of 40.68 points. The current value is 18,202.62. Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Express Company ( AXP ) had the largest percent change gain rising 1.95%.
NASDAQ Market Wrap
As of 10/19/2016 4:44:01 PM
BILLIONS OF 1.57 NASDAQ SHARES TRADED TODAY 40 STOCKS REACHED A 52 WEEK HIGH 30 THOSE REACHING LOWS TOTALEDAmerican Airlines Group, Inc. [AAL]TOPS ADVANCERS LISTOF NASDAQ 100 INDEX % 3.25 ROSE
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Airlines Group, Inc. ( AAL ) had the largest percent change gain rising 3.25%. NASDAQ Market Wrap As of 10/19/2016 4:44:01 PM BILLIONS OF 1.57 NASDAQ SHARES TRADED TODAY 40 STOCKS REACHED A 52 WEEK HIGH 30 THOSE REACHING LOWS TOTALEDAmerican Airlines Group, Inc. [AAL]TOPS ADVANCERS LISTOF NASDAQ 100 INDEX % 3.25 ROSE The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The Dow Jones index closed up .22% for the day; a total of 40.68 points.
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Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Airlines Group, Inc. ( AAL ) had the largest percent change gain rising 3.25%. NASDAQ Market Wrap As of 10/19/2016 4:44:01 PM BILLIONS OF 1.57 NASDAQ SHARES TRADED TODAY 40 STOCKS REACHED A 52 WEEK HIGH 30 THOSE REACHING LOWS TOTALEDAmerican Airlines Group, Inc. [AAL]TOPS ADVANCERS LISTOF NASDAQ 100 INDEX % 3.25 ROSE The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. On the NASDAQ Stock Exchange 40 stocks reached a 52 week high and 30 reaching lows.
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NASDAQ Market Wrap As of 10/19/2016 4:44:01 PM BILLIONS OF 1.57 NASDAQ SHARES TRADED TODAY 40 STOCKS REACHED A 52 WEEK HIGH 30 THOSE REACHING LOWS TOTALEDAmerican Airlines Group, Inc. [AAL]TOPS ADVANCERS LISTOF NASDAQ 100 INDEX % 3.25 ROSE The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Airlines Group, Inc. ( AAL ) had the largest percent change gain rising 3.25%. On the NASDAQ Stock Exchange 40 stocks reached a 52 week high and 30 reaching lows.
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NASDAQ Market Wrap As of 10/19/2016 4:44:01 PM BILLIONS OF 1.57 NASDAQ SHARES TRADED TODAY 40 STOCKS REACHED A 52 WEEK HIGH 30 THOSE REACHING LOWS TOTALEDAmerican Airlines Group, Inc. [AAL]TOPS ADVANCERS LISTOF NASDAQ 100 INDEX % 3.25 ROSE The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Intel Corporation ( INTC ) had the largest percent change down (-5.93%) while American Airlines Group, Inc. ( AAL ) had the largest percent change gain rising 3.25%. There were 1695 advancers and 1124 decliners for the day.
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7784.0
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2016-10-18 00:00:00 UTC
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How Did JetBlue Perform Operationally In September?
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AAL
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https://www.nasdaq.com/articles/how-did-jetblue-perform-operationally-september-2016-10-18
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nan
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In the month of September 2016, the low cost carrier, JetBlue, saw its capacity increase 7.9%, highest amongst its peers. Including this month, so far in the year, capacity is up as much as 10.3% for JetBlue. Its passenger traffic and passengers boarded increased by an impressive 10.8% each. The fall in JetBlue's unit revenues was arrested to only -2%, as compared to 5.5% in August. The company expects the decline in the metric, for the third quarter, to be in the range of 3%-4%.
Have more questions about JetBlue Corporation ( JBLU )? See the links below:
Why Has Trefis Revised Its Price Estimate For JetBlue To $18 Per Share?
Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM
JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results
What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value?
How Are US Air Fares Correlated To Crude Oil Prices?
Rapid Capacity Growth And Lower Fuel Costs Drive JetBlue's 1Q'16 Results
How Has JetBlue Utilized Its Cash Flows Over The Last Three Years?
How Has JetBlue's Revenue And EBITDA Grown Over The Last Five Years?
What Will Drive JetBlue's Revenue And EBITDA In The Next Five Years?
How Would JetBlue's Equity Value Be Impacted If Crude Oil Prices Reach $100 Per Barrel By 2018?
How Much Value Will JetBlue's International Operations Contribute To Its Revenue By 2020?
How Will JetBlue's Equity Value Be Impacted If Crude Oil Prices Average At $50 Per Barrel In 2018?
Capacity Expansions And Fuel Cost Savings Drive JetBlue's Earnings in 2015
How Did The Oil Slump Impact JetBlue's Operating Margins In 2015?
What Is JetBlue's Fundamental Value Based On 2016 Expected Numbers?
How Has JetBlue's Revenue And EBITDA Composition Changed Over The Last Five Years?
What Is JetBlue's Revenue And EBITDA Breakdown?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for JetBlue Corporation
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In the month of September 2016, the low cost carrier, JetBlue, saw its capacity increase 7.9%, highest amongst its peers. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com 2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for JetBlue Corporation View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value? Capacity Expansions And Fuel Cost Savings Drive JetBlue's Earnings in 2015 How Did The Oil Slump Impact JetBlue's Operating Margins In 2015? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Capacity Growth Fuels JetBlue's Q2'16 Revenues, Slightly Offset By Declining PRASM JetBlue's Q2'16 Earnings Preview: Capacity Expansion And Mint Services To Drive Results What Impact Will Crude Oil Prices Have On JetBlue's Enterprise Value? Rapid Capacity Growth And Lower Fuel Costs Drive JetBlue's 1Q'16 Results How Has JetBlue Utilized Its Cash Flows Over The Last Three Years? Capacity Expansions And Fuel Cost Savings Drive JetBlue's Earnings in 2015 How Did The Oil Slump Impact JetBlue's Operating Margins In 2015?
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What Will Drive JetBlue's Revenue And EBITDA In The Next Five Years? Capacity Expansions And Fuel Cost Savings Drive JetBlue's Earnings in 2015 How Did The Oil Slump Impact JetBlue's Operating Margins In 2015? For precise figures, please refer to our complete analysis for JetBlue Corporation View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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7785.0
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2016-10-18 00:00:00 UTC
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Alaska Air Q3'16 Earnings Preview: Continued Capacity Growth, Higher Unit Costs To Weigh On Earnings
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AAL
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https://www.nasdaq.com/articles/alaska-air-q316-earnings-preview-continued-capacity-growth-higher-unit-costs-weigh
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nan
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Key Trends:
In line with the industry-wide decline in PRASM, we expect Alaska Air's passenger unit revenue to fall in the range of 7%-8%, compared to last year same quarter. Although, some of this can be attributed to the general weakness in the industry, most of this is due to the airline's inefficient capacity management. This will adversely impact the airline's top line.
Although the airline cut back its capacity growth in September, it has still been on the higher end of the spectrum as compared to the other players in the market. This continued capacity growth, as a result, will keep pressuring unit revenue, despite helping traffic.
We have recently seen some recovery in oil prices , owing to the OPEC countries' decision to restrict their combined oil output between 32.5 and 33 million barrels per day, a potential reduction of 200 to 700 MBPD (thousand barrels per day) compared to the output in August. However, the increase is unlikely to have any material impact on the fuel expenditure of the airline in the quarter, as the prices continue to be much lower than the historical $100 per barrel.
After falling for the first two quarters, Alaska's unit cost is expected to grow at 3% y-o-y in the third quarter. Consequently, we can expect the operating margins to decline in the quarter.
After numerous obstacles in the way of the Alaska Air-Virgin America deal, the acquisition is expected to finally close in the last quarter of the year. The acquisition will make the carrier a premier airline for travelers on the West Coast, giving it the biggest chunk of California's air market.
See Our Complete Analysis For Alaska Air Here
Have more questions about Alaska Air ( ALK )? See the following links:
Why Have We Revised Alaska Air's Price Estimate To $69 Per Share?
Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs
Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings
How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program?
Will Alaska Air-Virgin America Face Antitrust Issues?
How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital?
How Will Alaska Air's Market Share Change Post The Virgin America Deal?
Why Is Alaska Air Acquiring Virgin America?
How Will Alaska Air Benefit From The Virgin America Deal Operationally?
How Will The Expected Return On The Alaska Air-Virgin America Merger Compare With The Previous Deals In The Sector?
How Will The Virgin America Deal Alter Alaska Air's Capital Structure?
Has Alaska Air Paid A Fair Price For Acquiring Virgin America?
Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Alaska Air Group
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Key Trends: In line with the industry-wide decline in PRASM, we expect Alaska Air's passenger unit revenue to fall in the range of 7%-8%, compared to last year same quarter. Alaska Air's Earnings Rise On The Back Of Rapid Capacity Growth And Lower Fuel Costs Notes: 1) The purpose of these analyses is to help readers focus on a few important things. For precise figures, please refer to our complete analysis for Alaska Air Group View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program? How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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See Our Complete Analysis For Alaska Air Here Have more questions about Alaska Air ( ALK )? Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program? How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital?
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Alaska Air Reports Another Strong Quarter Backed By Rapid Capacity Growth And Lower Fuel Costs Alaska Air Q2'16 Earnings Preview: Capacity Growth, Fiscal Discipline To Support Earnings How Will The Virgin America Deal Impact Alaska Air's Share Repurchase Program? How Will The Virgin America Merger Impact Alaska Air's Cost Of Capital? For precise figures, please refer to our complete analysis for Alaska Air Group View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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7786.0
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2016-10-18 00:00:00 UTC
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Union Pacific (UNP) Q3 Earnings: Is a Surprise in Store?
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AAL
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https://www.nasdaq.com/articles/union-pacific-unp-q3-earnings%3A-is-a-surprise-in-store-2016-10-18
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nan
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nan
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Leading railroad operator, Union Pacific CorporationUNP is slated to release third-quarter 2016 results on Oct 20, before the market opens.
Last quarter, the company reported in-line earnings. The bottom line, however, declined 15% on a year-over-year basis. Revenues decreased 12% year over year to $4.8 billion in the second quarter and narrowly missed the Zacks Consensus Estimate. Results were hurt by declining coal shipments.
Earnings Whispers
Our quantitative model does not show conclusively that Union Pacific is likely to beat on earnings in the third quarter. According to our proven model, a company needs the right combination of two key ingredients - a positive Earnings ESP and a Zacks Rank #3 (Hold) or better - to increase its odds of an earnings surprise. However, this is not the case as highlighted below.
Zacks ESP: The Earnings ESP for Union Pacific is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.39 per share.
Zacks Rank: Union Pacific holds a Zacks Rank #2 (Buy). Though the company has a favorable Zacks Racks, its 0.00% ESP complicates our surprise prediction. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Please note that the Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
UNION PAC CORP Price and EPS Surprise
UNION PAC CORP Price and EPS Surprise | UNION PAC CORP Quote
Factors Likely at Play
We expect Union Pacific's third-quarter results to be hurt by coal-related headwinds yet again. At the 9th Annual Global Transportation Conference last month, the company's CFO - Rob Knight - stated that overall volumes are expected to decline around 6% in the third quarter. Coal volumes had decreased by 15% as of Sep 1. Knight further stated that overall volumes are expected to decline in the band of 6-8% in 2016.
Moreover, the opening of the expanded Panama Canal, earlier this year, may hurt the company's business. The train derailment in Oregon has also increased concerns about safety in the railroads industry.
We are, however, impressed with Union Pacific's efforts to reward its investors through share buybacks and dividend payments. Apart from dividend payouts, we are encouraged by the company's prudent cost management. The company's operating expenses had declined 11% in the second quarter and we expect the trend to continue in this quarter as well. Lower costs are expected to drive the bottom line in the third quarter.
Stocks to Consider
Investors interested in the transportation space may consider the following stocks as our model shows they possess the right combination of elements to post an earnings beat this quarter.
Genesee & Wyoming Inc. GWR has an Earnings ESP of +4.26% and a Zacks Rank #3. The company, which will release its third-quarter results on Nov 1, has an impressive history with respect to earnings per share. It outpaced the Zacks Consensus Estimate in each of the last four quarters with an average positive surprise of 5.71%.
American Airlines Group AAL has an Earnings ESP of +3.01% and a Zacks Rank #3. The company, which will release its third-quarter results on Oct 20, has an impressive history with respect to earnings per share. The company beat the Zacks Consensus Estimate in each of the last four quarters with an average positive surprise of 4.27%.
Allegiant Travel Company ALGT has an Earnings ESP of +1.16% and a Zacks Rank #3. The company, which will release its third-quarter results on Oct 26, has an impressive history with respect to earnings per share. Allegiant outpaced the Zacks Consensus Estimate in three of the last four quarters with an average beat of 2.93%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report
UNION PAC CORP (UNP): Free Stock Analysis Report
GENESEE & WYO (GWR): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group AAL has an Earnings ESP of +3.01% and a Zacks Rank #3. Click to get this free report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report UNION PAC CORP (UNP): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Leading railroad operator, Union Pacific CorporationUNP is slated to release third-quarter 2016 results on Oct 20, before the market opens.
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Click to get this free report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report UNION PAC CORP (UNP): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group AAL has an Earnings ESP of +3.01% and a Zacks Rank #3. Zacks Rank: Union Pacific holds a Zacks Rank #2 (Buy).
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Click to get this free report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report UNION PAC CORP (UNP): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group AAL has an Earnings ESP of +3.01% and a Zacks Rank #3. According to our proven model, a company needs the right combination of two key ingredients - a positive Earnings ESP and a Zacks Rank #3 (Hold) or better - to increase its odds of an earnings surprise.
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American Airlines Group AAL has an Earnings ESP of +3.01% and a Zacks Rank #3. Click to get this free report ALLEGIANT TRAVL (ALGT): Free Stock Analysis Report UNION PAC CORP (UNP): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks ESP: The Earnings ESP for Union Pacific is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.39 per share.
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7787.0
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2016-10-18 00:00:00 UTC
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Should You Buy American Airlines (AAL) Ahead of Earnings?
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AAL
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https://www.nasdaq.com/articles/should-you-buy-american-airlines-aal-ahead-of-earnings-2016-10-18
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nan
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Investors are always looking for stocks that are poised to beat at earnings season and American Airlines Group Inc.AAL may be one such company. The firm has earnings coming up pretty soon, and events are shaping up quite nicely for their report.
That is because American Airlines is seeing favorable earnings estimate revision activity as of late, which is generally a precursor to an earnings beat. After all, analysts raising estimates right before earnings-with the most up-to-date information possible-is a pretty good indicator of some favorable trends underneath the surface for AAL in this report.
In fact, the Most Accurate Estimate for the current quarter is currently at 1.71 cents per share for AAL, compared to a broader Zacks Consensus Estimate of 1.66 cents per share. This suggests that analysts have very recently bumped up their estimates for AAL, giving the stock a Zacks Earnings ESP of 3.01% heading into earnings season.
AMER AIRLINES Price and EPS Surprise
AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote
Why is this Important?
A positive reading for the Zacks Earnings ESP has proven to be very powerful in producing both positive surprises, and outperforming the market. Our recent 10 year backtest shows that stocks that have a positive Earnings ESP and a Zacks Rank #3 (Hold) or better show a positive surprise nearly 70% of the time, and have returned over 28% on average in annual returns (see more Top Earnings ESP stocks here ).
Given that AAL has a Zacks Rank #3 (Hold) and an ESP in positive territory, investors might want to consider this stock ahead of earnings. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Clearly, recent earnings estimate revisions suggest that good things are ahead for American Airlines, and that a beat might be in the cards for the upcoming report.
Confidential from Zacks
Beyond this Tale of the Tape, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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After all, analysts raising estimates right before earnings-with the most up-to-date information possible-is a pretty good indicator of some favorable trends underneath the surface for AAL in this report. Given that AAL has a Zacks Rank #3 (Hold) and an ESP in positive territory, investors might want to consider this stock ahead of earnings. Investors are always looking for stocks that are poised to beat at earnings season and American Airlines Group Inc.AAL may be one such company.
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Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Investors are always looking for stocks that are poised to beat at earnings season and American Airlines Group Inc.AAL may be one such company. After all, analysts raising estimates right before earnings-with the most up-to-date information possible-is a pretty good indicator of some favorable trends underneath the surface for AAL in this report.
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This suggests that analysts have very recently bumped up their estimates for AAL, giving the stock a Zacks Earnings ESP of 3.01% heading into earnings season. Given that AAL has a Zacks Rank #3 (Hold) and an ESP in positive territory, investors might want to consider this stock ahead of earnings. Investors are always looking for stocks that are poised to beat at earnings season and American Airlines Group Inc.AAL may be one such company.
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This suggests that analysts have very recently bumped up their estimates for AAL, giving the stock a Zacks Earnings ESP of 3.01% heading into earnings season. Given that AAL has a Zacks Rank #3 (Hold) and an ESP in positive territory, investors might want to consider this stock ahead of earnings. Investors are always looking for stocks that are poised to beat at earnings season and American Airlines Group Inc.AAL may be one such company.
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7788.0
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2016-10-17 00:00:00 UTC
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FTA, AAL, KSS, MPC: ETF Outflow Alert
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AAL
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https://www.nasdaq.com/articles/fta-aal-kss-mpc-etf-outflow-alert-2016-10-17
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nan
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Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the First Trust Large Cap Value AlphaDEX Fund (Symbol: FTA) where we have detected an approximate $143.3 million dollar outflow -- that's a 15.2% decrease week over week (from 22,300,002 to 18,900,002). Among the largest underlying components of FTA, in trading today American Airlines Group Inc (Symbol: AAL) is up about 0.8%, Kohl's Corp. (Symbol: KSS) is off about 0.4%, and Marathon Petroleum Corp. (Symbol: MPC) is up by about 0.6%. For a complete list of holdings, visit the FTA Holdings page » The chart below shows the one year price performance of FTA, versus its 200 day moving average:
Looking at the chart above, FTA's low point in its 52 week range is $32.93 per share, with $43.13 as the 52 week high point - that compares with a last trade of $42.15. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average » .
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs experienced notable outflows »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the largest underlying components of FTA, in trading today American Airlines Group Inc (Symbol: AAL) is up about 0.8%, Kohl's Corp. (Symbol: KSS) is off about 0.4%, and Marathon Petroleum Corp. (Symbol: MPC) is up by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the First Trust Large Cap Value AlphaDEX Fund (Symbol: FTA) where we have detected an approximate $143.3 million dollar outflow -- that's a 15.2% decrease week over week (from 22,300,002 to 18,900,002). These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand.
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Among the largest underlying components of FTA, in trading today American Airlines Group Inc (Symbol: AAL) is up about 0.8%, Kohl's Corp. (Symbol: KSS) is off about 0.4%, and Marathon Petroleum Corp. (Symbol: MPC) is up by about 0.6%. For a complete list of holdings, visit the FTA Holdings page » The chart below shows the one year price performance of FTA, versus its 200 day moving average: Looking at the chart above, FTA's low point in its 52 week range is $32.93 per share, with $43.13 as the 52 week high point - that compares with a last trade of $42.15. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed).
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Among the largest underlying components of FTA, in trading today American Airlines Group Inc (Symbol: AAL) is up about 0.8%, Kohl's Corp. (Symbol: KSS) is off about 0.4%, and Marathon Petroleum Corp. (Symbol: MPC) is up by about 0.6%. Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel , one standout is the First Trust Large Cap Value AlphaDEX Fund (Symbol: FTA) where we have detected an approximate $143.3 million dollar outflow -- that's a 15.2% decrease week over week (from 22,300,002 to 18,900,002). For a complete list of holdings, visit the FTA Holdings page » The chart below shows the one year price performance of FTA, versus its 200 day moving average: Looking at the chart above, FTA's low point in its 52 week range is $32.93 per share, with $43.13 as the 52 week high point - that compares with a last trade of $42.15.
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Among the largest underlying components of FTA, in trading today American Airlines Group Inc (Symbol: AAL) is up about 0.8%, Kohl's Corp. (Symbol: KSS) is off about 0.4%, and Marathon Petroleum Corp. (Symbol: MPC) is up by about 0.6%. For a complete list of holdings, visit the FTA Holdings page » The chart below shows the one year price performance of FTA, versus its 200 day moving average: Looking at the chart above, FTA's low point in its 52 week range is $32.93 per share, with $43.13 as the 52 week high point - that compares with a last trade of $42.15. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed).
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7789.0
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2016-10-17 00:00:00 UTC
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J.P. Morgan, Ford, United, American and Apple are part of Zacks Earnings Preview
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AAL
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https://www.nasdaq.com/articles/j.p.-morgan-ford-united-american-and-apple-are-part-of-zacks-earnings-preview-2016-10-17
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nan
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nan
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For Immediate Release
Chicago, IL - October 17, 2016 - Zacks.com releases the list of companies likely to issue earnings surprises. This week's list includes J.P. Morgan (NYSE: JPM - Free Report ), Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) .
To see more earnings analysis, visit https://at.zacks.com/?id=3207 .
Every day, Zacks.com makes their Bull Stock of the Day available, free of charge. To see it, click here .
Reassuring Start to Q3 Earnings Season
The big banks have given us a reassuring start to the Q3 reporting cycle. If this trend continues next week when a broad and representative cross section of corporate America is on deck to come out with quarterly results, then we will have a tangible reason to get optimistic about the overall earnings picture.
J.P. Morgan (NYSE: JPM - Free Report ) stayed true to its well-earned reputation for operational excellence, with solid gains in both consumer banking as well as in its capital markets platform. In consumer banking, the core loan portfolio was up a robust +15% from the same period last year on essentially flat net-interest margin. On the investment banking side, J.P. Morgan came out with momentum in both capital markets as well as on the advisory side.
On the markets side, J.P. Morgan's trading volumes benefited from the post-Brexit surge, which management indicated has continued into Q4 as well. Overall markets revenue was up more than +20%, largely reflecting momentum in fixed income, currencies and commodities. We saw this positive capital markets trend in other bank reports as well, but the issue with them is more about political scrutiny, negative headlines and potential litigation and not earnings, at least not at this stage.
It will be interesting if this positive start from the major banks will continue with the other banks who are reporting this week. Bank earnings continue to be shackled by low interest rates, which have been weighing on the group's margins. The interest rates question is of course very complicated, as it not only reflects the market's evolving Fed view, but also the widespread incidence of negative yields in many other developed markets. Current consensus expectations for the group for the coming quarters and beyond reflect a notable improvement in this situation, particularly with respect to margins.
This week's reporting docket isn't just about banks and the broader Finance sector, we have more than 240 companies reporting results this week, including 80 S&P 500 members from a cross section of all major sectors. We will have a pretty good sense of how the Q3 earnings season is unfolding by the end of this week.
Q3 Earnings Season Scorecard ( as of 10/14/2016 )
Including the bank earnings reports, we now have Q3 results from 34 S&P 500 members. Total earnings for these 34 S&P 500 members are up +1.3% from the same period last year on +2.9% higher revenues, with 79.4% beating EPS estimates and 64.7% coming ahead of revenue estimates.
The picture emerging from the above comparison chart would be in-line with our modestly favorable commentary on the Q2 earnings season when we were detecting an ever-so-slight improvement in the growth picture. Earnings growth was in negative territory in Q2 - the 5th quarter in a row of earnings declines for the index - but the pace of declines was nevertheless an improvement over what we had seen in the preceding two quarters. This gave rise to the narrative that the worst was likely behind us now on the growth front and that the picture will steadily be improving going forward.
For the Finance sector, we have Q3 results from only 5 sector members. But these 5 combined account for more than a fifth of the sector's total market cap in the index. Total earnings for these 5 sector companies (includes J.P. Morgan, Citigroup & Wells Fargo) are up +1.3% from the same period last year on +2.9% higher revenues, with all of them beating EPS and revenue expectations (100% beat %).
This is better performance than we have seen from these banks in a while.
Q3 Expectations As a Whole
The strong results from the major banks has helped improve the overall Q3 growth expectations, with total Q3 earnings for the S&P 500 index now expected to be down -2.2% from the same period last year on +1.5% higher revenues. This would compare to 2016 Q2 earnings growth of -2.8% on +0.2% higher revenues.
Energy still remains the biggest drag on the aggregate growth picture, with Autos and Transportation as the other major growth laggards. Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors.
For the two biggest sectors, Technology earnings are expected to be down -1.7% on -1.1% lower revenues while Finance earnings are expected to be up +8.5% on +1.4% higher revenues. The Tech decline is solely a function of Apple (NASDAQ: AAPL - Free Report ), which is expected to see earnings decline -20.6% from the same period last year on -9.6% lower revenues. Excluding the Apple drag, the Tech sector's earnings would be up +3.0%.
Expectations Beyond Q3
The chart below shows current bottom-up consensus earnings expectations for the index in 2016 Q3 and the following four quarters contrasted with actual results in the preceding four quarters. Please note that the columns represent bottom-up earnings totals for each quarter in billions of dollars while the line represents the quarterly growth rates. As you can see, positive growth is expected to resume from Q4 (+5.2%), with the growth pace expected to ramp up meaningfully in the following quarters.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This week's list includes J.P. Morgan (NYSE: JPM - Free Report ), Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors. Get the full Report on JPM - FREE Get the full Report on F - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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This week's list includes J.P. Morgan (NYSE: JPM - Free Report ), Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Get the full Report on JPM - FREE Get the full Report on F - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report JPMORGAN CHASE (JPM): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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This week's list includes J.P. Morgan (NYSE: JPM - Free Report ), Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Get the full Report on JPM - FREE Get the full Report on F - FREE Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report JPMORGAN CHASE (JPM): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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Click to get this free report JPMORGAN CHASE (JPM): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here. This week's list includes J.P. Morgan (NYSE: JPM - Free Report ), Ford (NYSE: F - Free Report ), United (NYSE: UAL - Free Report ), American (NASDAQ: AAL - Free Report ) and Apple (NASDAQ: AAPL - Free Report ) . Tough comparisons at Ford (NYSE: F - Free Report ) and the air carriers, particularly United (NYSE: UAL - Free Report ) and American (NASDAQ: AAL - Free Report ), explain the growth issues in those two sectors.
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7790.0
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2016-10-17 00:00:00 UTC
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American Airlines (AAL) Q3 Earnings: A Beat in the Cards?
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AAL
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https://www.nasdaq.com/articles/american-airlines-aal-q3-earnings%3A-a-beat-in-the-cards-2016-10-17
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American Airlines Group Inc.AAL is slated to release third-quarter 2016 results on Oct 20, before the market opens.
In the second quarter, the carrier had delivered a positive earnings surprise of 7.27%. Results were aided by low fuel costs. This is because fuel accounts for a major chunk of an airline's operating expenses. Total operating expenses declined significantly to $8.6 billion on the back of a 24.9% reduction in fuel costs.
We expect the Fort Worth, TX- based carrier to deliver better-than-expected earnings in the third quarter as well driven by its strong fundamentals. The optimism regarding the stock ahead of its third-quarter earnings release can be gauged by the 7.8% increase in the Zacks Consensus Estimate over the last month.
AMER AIRLINES Price and EPS Surprise
AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote
Earnings Whispers
Our quantitative model shows that American Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
Zacks ESP: The Earnings ESP for American Airlines is +3.01% with the Most Accurate estimate exceeding the Zacks Consensus Estimate of $1.66 per share by 5 cents.
Zacks Rank: American Airlines carries a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating earnings estimates. Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
The combination of American Airlines' Zacks Rank #3 and a positive ESP makes us reasonably confident of an earnings beat.
What is Driving the Better-than-Expected Earnings?
The carrier has an impressive track record with respect to earnings per share. American Airlines outpaced the Zacks Consensus Estimate in each of the last four quarters with an average beat of 4.27%.
The carrier has seen quite a few positive developments in the third quarter. The final approval granted by the U.S. Department of Transportation to eight carriers, including American Airlines, to initiate commercial flights to Havana is a major positive. The carrier has gained approval to operate 35 direct flights a week and has already commenced its Cuban operations.
We are also encouraged by the bullish presentation of its newly appointed president, Robert Isom, at the 9th Annual Global Transportation Conference. Isom emphasized on the carrier's product segmentation strategy for effective branding, selling and pricing. We believe that more segmentation would boost the company's results.
We appreciate the company's efforts to reward shareholders through share buybacks and dividend payments. The carrier's efforts to modernize its fleet - introducing new aircraft and removing old ones from its fleet - also impress.
We are also optimistic about the improved view issued by the carrier with respect to total revenue per available seat mile (RASM: a key measure of unit revenue) for the third quarter. American Airlines now expects third-quarter RASM to decline in the band of approximately 2-3% (the earlier guidance had indicated a decline in the band of 3-5%) on a year-over-year basis. The company estimates pre-tax margin of 13-15% for the third quarter as against the previous guidance of 12-14%.
Other Stocks to Consider
Here are a few stocks in the transportation sector that you may want to consider as our model shows that these have the right combination of elements for an earnings beat this quarter:
Student Transportation Inc. STB has an Earnings ESP of over +11.11% and a Zacks Rank #2. The company, which beat the Zacks Consensus Estimate in three of the last four quarters, is expected to report third-quarter earnings on Nov 3. You can see the complete list of today's Zacks #1 Rank stocks here .
Genesee & Wyoming Inc. GWR has an Earnings ESP of +4.26% and a Zacks Rank #3. The company, which will release its third-quarter results on Nov 1, has an impressive history with respect to earnings per share, having outpaced the Zacks Consensus Estimate in each of the last four quarters by an average of 5.71%.
Alaska Air Group ALK has an Earnings ESP of +0.49% and carries a Zacks Rank #3. The carrier, which has seen the Zacks Consensus Estimate for the third quarter increase 3 cents to $2.04 per share over the last month, is scheduled to unveil its quarterly results on Oct 20.
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc.AAL is slated to release third-quarter 2016 results on Oct 20, before the market opens. Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report STUDENT TRANSPT (STB): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. We expect the Fort Worth, TX- based carrier to deliver better-than-expected earnings in the third quarter as well driven by its strong fundamentals.
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Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report STUDENT TRANSPT (STB): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. American Airlines Group Inc.AAL is slated to release third-quarter 2016 results on Oct 20, before the market opens. AMER AIRLINES Price and EPS Surprise AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote Earnings Whispers Our quantitative model shows that American Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
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American Airlines Group Inc.AAL is slated to release third-quarter 2016 results on Oct 20, before the market opens. Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report STUDENT TRANSPT (STB): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. AMER AIRLINES Price and EPS Surprise AMER AIRLINES Price and EPS Surprise | AMER AIRLINES Quote Earnings Whispers Our quantitative model shows that American Airlines is likely to beat earnings because it has the perfect combination of two key ingredients.
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American Airlines Group Inc.AAL is slated to release third-quarter 2016 results on Oct 20, before the market opens. Click to get this free report ALASKA AIR GRP (ALK): Free Stock Analysis Report GENESEE & WYO (GWR): Free Stock Analysis Report STUDENT TRANSPT (STB): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Other Stocks to Consider Here are a few stocks in the transportation sector that you may want to consider as our model shows that these have the right combination of elements for an earnings beat this quarter: Student Transportation Inc. STB has an Earnings ESP of over +11.11% and a Zacks Rank #2.
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7791.0
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2016-10-17 00:00:00 UTC
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United Continental Q3’16 Earnings Preview: Capacity Cuts To Partially Offset The Decline In PRASM
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AAL
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https://www.nasdaq.com/articles/united-continental-q316-earnings-preview-capacity-cuts-partially-offset-decline-prasm-2016
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nan
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nan
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Key Trends:
United revised its PRASM guidance from a decline of 5.5%-7.5% to 5.5%-6.0%, implying a small improvement, likely due to the reduction in capacity over the past quarter and better than expected September close-in bookings driven by the timing of certain holidays. However, the drop in passenger unit revenue continues to be significant, attributable mainly to competitive pressure from smaller carriers like JetBlue and SouthWest and a strong dollar. Below we give a break up of the effect various factors are likely to have on United's unit revenues in the third quarter of 2016.
The company's system-wide capacity should come in the range of its previous guidance of approximately 2%. The moderation in capacity will continue to support the airline's bottom line, partially offsetting the negative impact of higher fuel cost and operating expenses excluding fuel.
We have recently seen some recovery in oil prices , owing to the OPEC countries' decision to restrict their combined oil output between 32.5 and 33 million barrels per day, a potential reduction of 200 to 700 MBPD (thousand barrels per day) compared to the output in August. However, the increase is unlikely to have any material impact on the fuel expenditure of the airline in the quarter, as the prices continue to be much lower than the historical $100 per barrel.
United's pre-tax margins are expected to be up sequentially, by roughly 5 percentage points, owing to the lower fuel expense. However, this will be partially offset by the company's non-fuel operating expenses, which are expected be on the higher end of the guidance range due to the recently ratified labor agreement with pilots and flight attendants.
In a bid to attract more traffic, United is increasingly focusing on expansion into China. With 14 destinations in Asia, United currently holds the largest amount of capacity of any airline between the U.S. and China. To continue growing aggressively, they plan to connect more second-tier cities in China to the U.S. Consequently, it has already partnered with a local carrier, Air China, in the country. The partnership includes code-sharing on selected routes and provides customers with travel benefits, such as airport lounge access and frequent flyer program reciprocity. The deal will allow United to launch more flights to cities in China in the coming years.
Have more questions about United Continental ( UAL )? See the links below:
Lower Unit Revenue And Higher Tax Expense Caused United Continental's 1Q'16 Earnings To Drop Despite Fuel Cost Savings
Currency Headwinds To Offset United Continental's Fuel Cost Savings For 1Q'16
How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018?
How Will United's Equity Value Be Impacted If The Crude Oil Prices Average At $50 Per Barrel In 2018?
How Will United's Revenue And EBITDA Grow Over The Next Five Years?
How Important Is United's International Division For Its Overall Equity Value?
What Is United's Fundamental Value Based On 2016 Estimated Numbers?
Why We Think United Continental Is Worth $65 Per Share?
What Drove United's Revenue And EBITDA Growth Over The Last Five Years?
How Has United's Revenue And EBITDA Composition Changed Over The Last Five Years?
What Is United Continental's Revenue And EBITDA Breakdown?
How Has United Continental Utilized Its Cash Flows Over The Last Three Years?
How Have Plummeting Crude Oil Prices Impacted United Continental's Operating Margin?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for United Continental
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
More Trefis Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Key Trends: United revised its PRASM guidance from a decline of 5.5%-7.5% to 5.5%-6.0%, implying a small improvement, likely due to the reduction in capacity over the past quarter and better than expected September close-in bookings driven by the timing of certain holidays. However, this will be partially offset by the company's non-fuel operating expenses, which are expected be on the higher end of the guidance range due to the recently ratified labor agreement with pilots and flight attendants. For precise figures, please refer to our complete analysis for United Continental View Interactive Institutional Research (Powered by Trefis): Global Large Cap | U.S.
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See the links below: Lower Unit Revenue And Higher Tax Expense Caused United Continental's 1Q'16 Earnings To Drop Despite Fuel Cost Savings Currency Headwinds To Offset United Continental's Fuel Cost Savings For 1Q'16 How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? How Have Plummeting Crude Oil Prices Impacted United Continental's Operating Margin? Mid & Small Cap | European Large & Mid Cap More Trefis Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Below we give a break up of the effect various factors are likely to have on United's unit revenues in the third quarter of 2016. See the links below: Lower Unit Revenue And Higher Tax Expense Caused United Continental's 1Q'16 Earnings To Drop Despite Fuel Cost Savings Currency Headwinds To Offset United Continental's Fuel Cost Savings For 1Q'16 How Will United's Equity Value Be Impacted If The Crude Oil Prices Rebound To $100 Per Barrel By 2018? How Have Plummeting Crude Oil Prices Impacted United Continental's Operating Margin?
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The moderation in capacity will continue to support the airline's bottom line, partially offsetting the negative impact of higher fuel cost and operating expenses excluding fuel. How Will United's Revenue And EBITDA Grow Over The Next Five Years? What Is United Continental's Revenue And EBITDA Breakdown?
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7792.0
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2016-10-16 00:00:00 UTC
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Good News for American Airlines Investors in Delta's Earnings Report
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AAL
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https://www.nasdaq.com/articles/good-news-american-airlines-investors-deltas-earnings-report-2016-10-16
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nan
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nan
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On Thursday, Delta Air Lines (NYSE: DAL) reported somewhat disappointing results for the summer peak season. The company earned a strong pre-tax margin of more than 18%, but a 6.8% decline in passenger revenue per available seat mile (PRASM) caused a year-over-year earnings decline .
PRASM slumped 6.8% year over year at Delta Air Lines last quarter. Image source: The Motley Fool.
On the positive side, Delta projected that its unit revenue decline would moderate to 3%-5% in Q4. This improving unit revenue trajectory at Delta bodes well for American Airlines '(NASDAQ: AAL) efforts to return to unit revenue growth this quarter.
American Airlines is already outperforming
Whereas Delta just posted its biggest unit revenue decline since the Great Recession, American Airlines' unit revenue trajectory is already much improved. Earlier this week, American raised its Q3 unit revenue guidance. It now expects revenue per available seat mile (RASM) to fall 2%-3% year over year . By contrast, in July, it had expected a 3.5%-5.5% RASM drop.
This marks a big improvement from the 6.1% RASM decline that American Airlines recorded in Q2. About 1 percentage point of improvement stems from the company's updated credit card agreement, but the rest represents a genuine change in revenue trends.
Let's take a look at three major reasons why American Airlines is experiencing a faster unit revenue recovery than Delta Air Lines -- and why that could continue in Q4.
Favorable geography
First, American Airlines has a larger footprint in regions with better unit revenue trends. In Q2, roughly 74% of its passenger revenue came from the domestic market, compared to 69% for Delta. Slowing industry capacity growth and rising fuel prices are driving a domestic unit revenue recovery. Delta believes that its domestic PRASM could reach the flat line by December. American Airlines will benefit even more as domestic unit revenue trends strengthen.
American Airlines is also well positioned in the international market. Latin America was the only geographic region where Delta returned to unit revenue growth last quarter. This was mainly driven by a sharp turnaround in Brazil, where PRASM surged 30% year over year.
American Airlines is several times Delta's size in Brazil. That means huge unit revenue gains there would have a significant impact on its overall results. PRASM slumped 25% year over year on American's routes to Brazil in Q3 2015, offering lots of room for improvement. However, PRASM fell a stunning 40% on American's Brazilian routes in Q4 2015, so the upside will be even bigger for the current quarter.
American Airlines is poised to deliver strong unit revenue growth in Brazil. Image source: American Airlines.
While American Airlines has a bigger presence in the domestic and Latin American markets than Delta, it is significantly smaller in the transatlantic and transpacific markets. That's helping American right now, as industry unit revenue trends have been much worse in those two regions.
The Dallas competitive environment is easing
Second, American Airlines is finally getting a respite from rapid competitive capacity growth in the Dallas-Fort Worth region, home to its largest hub. It has faced severe unit revenue pressure there over the past two years due to a large capacity buildup by Southwest Airlines at Dallas Love Field.
The last wave of Southwest's expansion in Dallas occurred in mid-August of 2015. Thus, American Airlines finally lapped the impact of this competitive headwind in the middle of last quarter. In Q4, it will finally get a "clean" year-over-year comparison.
Additionally, fare pressure in Dallas has finally convinced Spirit Airlines to make some cutbacks there. Next month, the ultra-low-cost carrier will terminate its routes from Dallas/Fort Worth International Airport to New Orleans, Oakland, and San Diego. That should allow American to pull back on discounting in those markets.
More capacity discipline
Third, American Airlines appears to be even more committed to capacity discipline than Delta Air Lines right now. While Delta expects to limit its capacity growth to just 1% in Q4, American Airlines doesn't plan to grow at all this quarter.
By holding overall capacity flat, American Airlines will have more flexibility than Delta to reduce service in underperforming markets. That should lead to better unit revenue results.
Delta Air Lines expects to report significant sequential unit revenue improvement in Q4. American Airlines should be able to achieve at least the same level of sequential improvement, due to its high exposure to stronger markets, improving competitive capacity trends at its biggest hub, and its plan to hold capacity flat. As a result, American Airlines could become the first legacy carrier to return to unit revenue growth in Q4.
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Adam Levine-Weinberg owns shares of Spirit Airlines and is l ong December 2016 $30 calls on Spirit Airlines . Adam Levine-Weinberg is long January 2017 $30 calls on American Airlines Group and long January 2017 $40 calls on Delta Air Lines. The Motley Fool recommends Spirit Airlines. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This improving unit revenue trajectory at Delta bodes well for American Airlines '(NASDAQ: AAL) efforts to return to unit revenue growth this quarter. About 1 percentage point of improvement stems from the company's updated credit card agreement, but the rest represents a genuine change in revenue trends. Let's take a look at three major reasons why American Airlines is experiencing a faster unit revenue recovery than Delta Air Lines -- and why that could continue in Q4.
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This improving unit revenue trajectory at Delta bodes well for American Airlines '(NASDAQ: AAL) efforts to return to unit revenue growth this quarter. Delta Air Lines expects to report significant sequential unit revenue improvement in Q4. Adam Levine-Weinberg is long January 2017 $30 calls on American Airlines Group and long January 2017 $40 calls on Delta Air Lines.
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This improving unit revenue trajectory at Delta bodes well for American Airlines '(NASDAQ: AAL) efforts to return to unit revenue growth this quarter. American Airlines is already outperforming Whereas Delta just posted its biggest unit revenue decline since the Great Recession, American Airlines' unit revenue trajectory is already much improved. Let's take a look at three major reasons why American Airlines is experiencing a faster unit revenue recovery than Delta Air Lines -- and why that could continue in Q4.
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This improving unit revenue trajectory at Delta bodes well for American Airlines '(NASDAQ: AAL) efforts to return to unit revenue growth this quarter. PRASM slumped 6.8% year over year at Delta Air Lines last quarter. Delta Air Lines expects to report significant sequential unit revenue improvement in Q4.
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7793.0
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2016-10-14 00:00:00 UTC
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United Continental (UAL) Q3 Earnings: A Beat in Store?
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AAL
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https://www.nasdaq.com/articles/united-continental-ual-q3-earnings%3A-a-beat-in-store-2016-10-14
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nan
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nan
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We expect Chicago-based United Continental Holdings, Inc.UAL to report better-than-expected earnings in the third quarter of 2016. The carrier will release its results on Oct 17, after market closes.
In the second quarter, the carrier had reported a positive earnings surprise of 1.56%. The earnings beat was mainly due to a conservative Zacks Consensus Estimate for the second quarter ($2.57 per share which happened to be much lower than the second-quarter 2015 figure of $3.29). Revenues also beat expectations but declined year over year.
The United Continental stock has gained over 10% since the second-quarter earnings beat. The optimism regarding the stock ahead of its third-quarter earnings release can be gauged by the 4.2% increase in the Zacks Consensus Estimate over the last month.
UNITED CONT HLD Price and EPS Surprise
UNITED CONT HLD Price and EPS Surprise | UNITED CONT HLD Quote
Our quantitative model shows that United Continental is likely to beat earnings because it has the perfect combination of two key ingredients.
Zacks ESP: The Earnings ESP for United Continental is +1.01% with the Most Accurate estimate exceeding the Zacks Consensus Estimate of $2.98 per share by 3 cents.
Zacks Rank: United Continental carries a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating earnings estimates. Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
The combination of United Continental's Zacks Rank #3 and a positive ESP makes us reasonably confident of an earnings beat.
What is Driving the Better-than-Expected Earnings?
The carrier has an impressive track record with respect to earnings per share. United Continental outpaced the Zacks Consensus Estimate in three of the last four quarters with an average beat of 1.41%.
The carrier has seen quite a few positive developments in the third quarter, including the appointment of Scott Kirby as the president - a newly created position at the carrier. Kirby, who joined United Continental Holdings from American Airlines Group AAL , has vast experience in the airline space and his appointment is a prudent move by United Continental to turn around its fortunes.
We are also positive on the U.S. Department of Transportation's decision to grant final approval to eight carriers, including United Continental, to initiate commercial flights to Havana. We believe that, once operational, United Continental's top line will be benefitted immensely by the new route additions as Havana is a favorite tourist spot. We expect a detailed commentary on the issue at the third-quarter conference call.
We are also positive on United Continental's efforts to reward its shareholders. Moreover, its constant efforts to expand and modernize its fleet are encouraging. Moreover, the bottom-line performance in the third quarter is likely to be aided by low fuel costs. The company expects fuel price (inclusive of all cash settled hedges) to be $1.52 per gallon, well below the year-ago figure.
Though the company continues to face difficulties in terms of top-line growth, we are encouraged by the improved third-quarter forecast for passenger revenue per available seat mile (PRASM: a key measure of unit revenue). The carrier now expects the metric to decline in the band of 5.5-6% as against the previous guidance of a decline in the band of 5.5-7.5%.
In view of these bullish developments and the positive sentiment surrounding the stock currently, United Continental is expected to report outperform on the earnings front on Oct 17, just like Delta Air Lines DAL did on Oct 14.
Another Stock to Consider
Investors interested in the airline space may also consider Alaska Air Group ALK , as our model shows that it has the right combination for an earnings beat this quarter.
The Seattle, WA-based carrier has an Earnings ESP of +0.49% and carries a Zacks Rank #3. The carrier, which has seen the Zacks Consensus Estimate for the third quarter increase 1% to $2.03 per share over the last month, is scheduled to unveil its third-quarter results on Oct 20. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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DELTA AIR LINES (DAL): Free Stock Analysis Report
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UNITED CONT HLD (UAL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Kirby, who joined United Continental Holdings from American Airlines Group AAL , has vast experience in the airline space and his appointment is a prudent move by United Continental to turn around its fortunes. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The earnings beat was mainly due to a conservative Zacks Consensus Estimate for the second quarter ($2.57 per share which happened to be much lower than the second-quarter 2015 figure of $3.29).
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Kirby, who joined United Continental Holdings from American Airlines Group AAL , has vast experience in the airline space and his appointment is a prudent move by United Continental to turn around its fortunes. UNITED CONT HLD Price and EPS Surprise UNITED CONT HLD Price and EPS Surprise | UNITED CONT HLD Quote Our quantitative model shows that United Continental is likely to beat earnings because it has the perfect combination of two key ingredients.
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Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Kirby, who joined United Continental Holdings from American Airlines Group AAL , has vast experience in the airline space and his appointment is a prudent move by United Continental to turn around its fortunes. UNITED CONT HLD Price and EPS Surprise UNITED CONT HLD Price and EPS Surprise | UNITED CONT HLD Quote Our quantitative model shows that United Continental is likely to beat earnings because it has the perfect combination of two key ingredients.
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Kirby, who joined United Continental Holdings from American Airlines Group AAL , has vast experience in the airline space and his appointment is a prudent move by United Continental to turn around its fortunes. Click to get this free report DELTA AIR LINES (DAL): Free Stock Analysis Report ALASKA AIR GRP (ALK): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. We expect Chicago-based United Continental Holdings, Inc.UAL to report better-than-expected earnings in the third quarter of 2016.
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7794.0
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2016-10-14 00:00:00 UTC
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Delta Q3'16 Earnings Review: Continued Headwinds In Unit Revenues, Despite Reduction In Capacity
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AAL
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https://www.nasdaq.com/articles/delta-q316-earnings-review-continued-headwinds-unit-revenues-despite-reduction-capacity
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nan
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nan
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Delta Air Lines ( DAL ) released its September 2016 financial results on 14th October 2016, beating the consensus for earnings, while slightly missing it for revenue. The company attributes the decline in revenues primarily to the strength in the U.S. dollar compared to other currencies, and the technology outage that occurred in early August. However, due to fiscal discipline and the continued slump in oil prices , the company was able to deliver operating margins almost comparable to Q3, 2015, at 18.8%.
In terms of providing value to the shareholders, the $1.1 billion free cash flow (adjusted for capital expenditure and hedging activities) allowed the company to return approximately $650 million back to its equity owners, in terms of dividends and buybacks. This, in turn, helped buoy earnings upwards, despite a decline in revenues.
Although Delta's unit revenues for Q3'16 came in line with its guidance range of -7%, the downtrend was seen to be persistent, despite minimal capacity growth in the quarter. The only region to show positive unit revenues was Latin America, mainly due to the launch of new flights to Mexico and Cuba. It seems unlikely that the airline will be able to turn around its PRASM numbers at the end of this year, as it earlier expected, due to the supply and demand imbalances in the Atlantic region and China, and the impact of foreign currency fluctuations. In line with this, the revised guidance for the fourth quarter unit revenues is in the (3%) - (5%) range. The company hopes to curtail the capacity growth in the remainder of the year and throughout the next year to 1%-2%, as it tries to return to positive PRASM in the face of rising oil prices and margin deterioration.
In terms of expenses, the company expects non-fuel costs to increase slightly in the quarter, due to lower capacity and expenses on maintenance. Consequently, Delta expects its operating margins to decline on an annual basis to 14%-16% in Q4'16. Further, in 2017, these costs may increase as the impact of the pilot agreement and higher fuel costs begins to be felt on operating expenses.
Have more questions about Delta Air Lines ( DAL )? See the links below:
How Did Delta Perform Operationally In August?
What Is The Impact Of Flight Delays?
Delta Versus JetBlue: Expansion Into Boston And Its Effect On Unit Revenues
How Will Delta Air Lines Utilize Its Cash Flows?
Delta Airlines Re-Fleeting Program: How Will It Help?
Why Has Trefis Lowered Delta's Price Estimate From $51 To $44 Per Share?
Delta Q2'16 Earnings Preview: Rising Oil Prices, Lower Unit Revenues May Drag Down Revenues
Delta Continues To Face Headwinds In Revenues, But Delivers On Earnings Growth in Q2'16
Delta's Profits Continue To Surge As Crude Oil Prices Remain Low In 1Q'16
What Should We Expect From Delta's 1Q'16 Results?
How Did The Legacy Carriers Perform Operationally In January?
Why Did Delta's Operating Margin Soar In 2015?
Delta Air Lines: The Year 2015 In Review
How Will Delta's Revenue And EBITDA Grow Between 2015 and 2018?
How Has Delta's Revenue And EBITDA Changed Over The Last Five Years
What Is Delta's Revenue And EBITDA Brekdown?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Delta Air Lines ( DAL ) released its September 2016 financial results on 14th October 2016, beating the consensus for earnings, while slightly missing it for revenue. The company attributes the decline in revenues primarily to the strength in the U.S. dollar compared to other currencies, and the technology outage that occurred in early August. It seems unlikely that the airline will be able to turn around its PRASM numbers at the end of this year, as it earlier expected, due to the supply and demand imbalances in the Atlantic region and China, and the impact of foreign currency fluctuations.
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The company hopes to curtail the capacity growth in the remainder of the year and throughout the next year to 1%-2%, as it tries to return to positive PRASM in the face of rising oil prices and margin deterioration. In terms of expenses, the company expects non-fuel costs to increase slightly in the quarter, due to lower capacity and expenses on maintenance. Delta Q2'16 Earnings Preview: Rising Oil Prices, Lower Unit Revenues May Drag Down Revenues Delta Continues To Face Headwinds In Revenues, But Delivers On Earnings Growth in Q2'16 Delta's Profits Continue To Surge As Crude Oil Prices Remain Low In 1Q'16 What Should We Expect From Delta's 1Q'16 Results?
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Delta Q2'16 Earnings Preview: Rising Oil Prices, Lower Unit Revenues May Drag Down Revenues Delta Continues To Face Headwinds In Revenues, But Delivers On Earnings Growth in Q2'16 Delta's Profits Continue To Surge As Crude Oil Prices Remain Low In 1Q'16 What Should We Expect From Delta's 1Q'16 Results? Delta Air Lines: The Year 2015 In Review How Will Delta's Revenue And EBITDA Grow Between 2015 and 2018? How Has Delta's Revenue And EBITDA Changed Over The Last Five Years What Is Delta's Revenue And EBITDA Brekdown?
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See the links below: How Did Delta Perform Operationally In August? Delta Versus JetBlue: Expansion Into Boston And Its Effect On Unit Revenues How Will Delta Air Lines Utilize Its Cash Flows? Delta Q2'16 Earnings Preview: Rising Oil Prices, Lower Unit Revenues May Drag Down Revenues Delta Continues To Face Headwinds In Revenues, But Delivers On Earnings Growth in Q2'16 Delta's Profits Continue To Surge As Crude Oil Prices Remain Low In 1Q'16 What Should We Expect From Delta's 1Q'16 Results?
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7795.0
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2016-10-13 00:00:00 UTC
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Zacks Earnings Trends Highlights: American Airlines, United Continental, Ford and Apple
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AAL
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https://www.nasdaq.com/articles/zacks-earnings-trends-highlights%3A-american-airlines-united-continental-ford-and-apple-2016
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nan
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nan
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For Immediate Release
Chicago, IL - October 13, 2016 - Zacks Director of Research Sheraz Mian says, "The expectation is that the worst is behind us now, with the earnings picture expected to improve in the coming periods."
What Will Q3 Earnings Season Bring?
Note: The following is an excerpt from this week's Earnings Trends report. You can access the full report that contains detailed historical actuals and estimates for the current and following periods, please click here>>>
The Q3 earnings season ramps up in the coming days, with many in the market looking for this reporting cycle to confirm the modest improvements in the overall earnings picture in the preceding earnings season. Earnings growth was negative in Q2 - the 5th quarter in a row of earnings declines for the S&P 500 index - and current expectations are for a -2.9% decline in Q3. But the expectation is that the worst is behind us now, with the picture expected to improve in the coming periods. Driving this favorable view are three key points.
First, the magnitude of negative revisions that Q3 estimates suffered were lower compared to what we had seen in the preceding quarters. Estimates for Q3 came down as companies reported Q2 results and guided lower, with expectations of earnings growth for the S&P 500 index dropping from an essentially flat reading at the beginning of July to the current -2.9%. This is a lower drop than we became used to seeing in the comparable periods in the preceding quarters.
Second, the -2.9% decline in Q3 earnings on +1.2% higher revenues will be the lowest decline rate expected at the start of the season. At the comparable stage in the Q2 earnings season, earnings growth for the S&P 500 index was expected to be -6.2%, which actually turned out to be -2.8%. We had similarly bigger decline rates expected at the start of earnings season in Q1 and the quarters prior to that, with actual earnings growth rates coming in better than pre-season expectations by about +2% to +3%. If Q3 results follow this trend, the finally growth tally will most likely be close to a flat finish, even in positive territory.
Third, the Energy sector still remains a big drag on the aggregate growth picture, with total earnings for the sector expected to be down -68.3% from the same period last year. Excluding the Energy sector, total earnings for the S&P 500 would be modestly in positive territory, up +0.3%. The Energy sector still has plenty of challenges, but the tyranny of tough comparisons is starting to fade. It is a smaller burden in Q3 than was the case in either of the preceding two quarters and comparisons are expected to turn positive in the following earnings season.
Standout Sectors This Earnings Season
Earnings growth is expected to be negative for half of the 16 Zacks sectors, led by Energy (- 68.3%), Transportation (- 21.4%), and Autos (- 18.5%). The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ((NASDAQ: AAL - Free Report ) and United Continental (NYSE: UAL - Free Report ) that are experiencing higher costs following recent labor contract awards. The Auto sector's growth issue is primarily due to Ford (NYSE: F - Free Report ), which guided lower the last earnings season.
Growth is expected to be negative for the Technology sector as well, with total earnings for the sector expected to be down -1.8% from the same period last year on -1.1% lower revenues. The Tech growth challenge is primarily concentrated in Apple ((NASDAQ: AAPL - Free Report ) whose September-quarter earnings are expected to be down -20.7% on -9.6% lower revenues. Excluding Apple, the sector's Q3 earnings would be up +3.0% on +0.5% higher revenues.
On the positive side of the ledger, we have Construction (+6.3% earnings growth in Q3), Business Services (+7.1%), Retail (+4.4%), Utilities (+4.8%) and Finance (+4%).
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ((NASDAQ: AAL - Free Report ) and United Continental (NYSE: UAL - Free Report ) that are experiencing higher costs following recent labor contract awards. Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on F - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ((NASDAQ: AAL - Free Report ) and United Continental (NYSE: UAL - Free Report ) that are experiencing higher costs following recent labor contract awards. Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on F - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on F - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here. The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ((NASDAQ: AAL - Free Report ) and United Continental (NYSE: UAL - Free Report ) that are experiencing higher costs following recent labor contract awards.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ((NASDAQ: AAL - Free Report ) and United Continental (NYSE: UAL - Free Report ) that are experiencing higher costs following recent labor contract awards. Get the full Report on AAL - FREE Get the full Report on UAL - FREE Get the full Report on F - FREE Get the full Report on AAPL - FREE Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Click to get this free report AMER AIRLINES (AAL): Free Stock Analysis Report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here.
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7796.0
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2016-10-13 00:00:00 UTC
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Why American Airlines Group, Lindsay, and Gold Fields International Jumped Today
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AAL
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https://www.nasdaq.com/articles/why-american-airlines-group-lindsay-and-gold-fields-international-jumped-today-2016-10-13
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nan
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nan
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The stock market once again proved its resilience on Thursday, bouncing back from what had been extensive losses earlier in the day. Stock market indexes fell more than 1%, with the Dow falling almost 200 points at one point after the latest readings on trade activity in China suggested the possibility of a broader slowdown in the world's second-largest economy. Geopolitical and monetary policy concerns also surfaced, with some interpreting the three dissenting votes in the Federal Open Market Committee's September meeting as a sign of an increasingly divided central bank.
By the end of the day, though, markets had clawed back much of their lost ground, and major market benchmarks finished with losses of between 0.25% and 0.5%. Some stocks even managed to rise, and the best performers included American Airlines Group (NASDAQ: AAL) , Lindsay (NYSE: LNN) , and Gold Fields International (NYSE: GFI) .
Image source: American Airlines.
American flies higher
American Airlines Group gained 5% in the wake of rival Delta Air Lines '(NYSE: DAL) release of its third-quarter earnings results. Delta reported a 4% decline in net income for the quarter compared to the year-ago period, as weaker pricing and higher labor costs offset the lower cost of jet fuel. With revenue per available seat mile falling almost 7% during the quarter, Delta said it would look to clamp down on capacity growth to try to increase the chances of successfully raising its airfares. Comments Delta executives made suggested that the entire industry might be approaching the low point for pricing, and moves to reduce capacity would help American and other airline rivals as much as they help Delta. Most airline stocks climbed in sympathy, but American arguably has more to gain because of its size and competitive position within the industry.
Lindsay has a blowout quarter
Lindsay jumped 11% after the provider of irrigation systems and infrastructure products reported better fiscal fourth-quarter results than most investors had expected. Lindsay said sales came in at $132.9 million, up almost 8% from the year-ago quarter, and the company reversed a loss in the prior period by posting earnings of $0.73 per share. The company's Road Zipper System for highway barrier management was particularly successful, helping send infrastructure segment sales up by nearly a quarter. But irrigation-related sales were also solid despite pressure from a weak Brazilian economy. Even though CEO Rick Parod was less than optimistic about his expectations for a recovery in the agricultural industry, he nevertheless said that improving gross margins could continue to drive solid performance even if sluggish conditions persist.
Gold Fields looks richer
Finally, Gold Fields International rose 4%. The day was a good one for gold miners in general, with the VanEck Vectors Gold Miners ETF (NYSEMKT: GDX) picking up almost 2% on the day. Gold prices posted modest gains, rising about $6 to $1,260 per ounce. One big question that remains important both for thegold marketgenerally and for Gold Fields in particular is how quickly the Federal Reserve and other global central banks will raise interest rates back to more normal levels, as low rates have supported investment in precious metals by reducing financing costs. The recent downturn in gold came after concerns that rising rates could come more quickly than previously expected, and for Gold Fields, the fact that it's based in South Africa adds a currency element to the picture as well. Overall, Gold Fields investors can expect a volatile ride until the future course of monetary policy becomes clearer.
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Dan Caplinger has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Some stocks even managed to rise, and the best performers included American Airlines Group (NASDAQ: AAL) , Lindsay (NYSE: LNN) , and Gold Fields International (NYSE: GFI) . Geopolitical and monetary policy concerns also surfaced, with some interpreting the three dissenting votes in the Federal Open Market Committee's September meeting as a sign of an increasingly divided central bank. With revenue per available seat mile falling almost 7% during the quarter, Delta said it would look to clamp down on capacity growth to try to increase the chances of successfully raising its airfares.
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Some stocks even managed to rise, and the best performers included American Airlines Group (NASDAQ: AAL) , Lindsay (NYSE: LNN) , and Gold Fields International (NYSE: GFI) . American flies higher American Airlines Group gained 5% in the wake of rival Delta Air Lines '(NYSE: DAL) release of its third-quarter earnings results. Gold prices posted modest gains, rising about $6 to $1,260 per ounce.
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Some stocks even managed to rise, and the best performers included American Airlines Group (NASDAQ: AAL) , Lindsay (NYSE: LNN) , and Gold Fields International (NYSE: GFI) . One big question that remains important both for thegold marketgenerally and for Gold Fields in particular is how quickly the Federal Reserve and other global central banks will raise interest rates back to more normal levels, as low rates have supported investment in precious metals by reducing financing costs. The recent downturn in gold came after concerns that rising rates could come more quickly than previously expected, and for Gold Fields, the fact that it's based in South Africa adds a currency element to the picture as well.
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Some stocks even managed to rise, and the best performers included American Airlines Group (NASDAQ: AAL) , Lindsay (NYSE: LNN) , and Gold Fields International (NYSE: GFI) . Comments Delta executives made suggested that the entire industry might be approaching the low point for pricing, and moves to reduce capacity would help American and other airline rivals as much as they help Delta. Lindsay said sales came in at $132.9 million, up almost 8% from the year-ago quarter, and the company reversed a loss in the prior period by posting earnings of $0.73 per share.
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7797.0
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2016-10-12 00:00:00 UTC
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Will New Management Drive Unit Revenue Growth at United Airlines?
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AAL
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https://www.nasdaq.com/articles/will-new-management-drive-unit-revenue-growth-united-airlines-2016-10-12
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nan
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nan
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In the past few months, United Continental (NYSE: UAL) CEO Oscar Munoz has added three new top executives to fill out his management team. The biggest coup of all was poaching Scott Kirby from American Airlines (NASDAQ: AAL) to serve as United's president, a role with broad responsibilities across sales, planning, and operations.
For the most part, Wall Street analysts were upbeat about Kirby's hiring. Deutsche Bank analyst Mike Linenberg recently described Kirby as a " kid in a candy store " as he tackles the task of improving United's unit revenue performance. However, while Kirby will undoubtedly make his mark on United, he faces a tougher task than in previous network restructurings he has led.
A lofty reputation
Scott Kirby and American Airlines CEO Doug Parker made their names more than a decade ago, when they led America West's takeover of larger rival US Airways.
In Q1 2006, shortly after the merger was finalized, unit revenue surged an astounding 28% year over year on legacy US Airways routes. This surprisingly strong performance allowed US Airways (then operating under bankruptcy protection) to report a quarterly profit, compared to a steep loss the year before.
Unit revenue soared as Scott Kirby remade US Airways' route network a decade ago. Image source: The Motley Fool.
While Parker and Kirby won a lot of admirers with this performance, the strategy was simple. Since US Airways was going through bankruptcy, it had the ability to reject unfavorable contracts and smoothly downsize its network. The company cut its worst-performing routes, including a sharp downsizing in Pittsburgh, once a massive US Airways hub.
In subsequent years, Parker and Kirby further refined their strategy by cutting nearly every route US Airways served that didn't touch one of four key hubs: Charlotte, Philadelphia, Phoenix, and Washington-Reagan. This put US Airways in a strong enough position by 2013 that it was able to merge with American Airlines, creating the largest airline in the world.
There's no magic wand
American Airlines' performance over the past few years shows that while Scott Kirby is good at revenue management, he doesn't have a magic wand. In 2014, the first year after the American-US Airways merger closed, American's passenger revenue per available seat mile (PRASM) increased 2.2% year over year. That was only slightly better than United Airlines' 1.6% PRASM increase.
Last year, American actually underperformed United on the unit revenue front. PRASM fell 5.4% at American Airlines for the full year, compared to a 4.4% decline for United.
The subpar performance was largely caused by factors outside management's control, such as Southwest Airlines ' rapid growth in Dallas (American Airlines' largest market). But it's also true that there was less low-hanging fruit. American had already cut most of the fat in its route network, defending just its key hub markets.
Looking at the options
Due to changing demand patterns, airlines almost always have some underperforming routes that probably need to be dropped. But to get United Airlines into the upper echelon of the industry in terms of profitability, the management team will need to make bigger changes.
There aren't many obvious targets for the kind of downsizing Scott Kirby led at US Airways a decade ago. United has seven hubs: Chicago, Denver, Houston, Los Angeles, New York, San Francisco, and Washington, D.C. They serve six of the 10 biggest regional economies in the U.S. (The lone exception is Denver, a city posting phenomenal economic growth.) Furthermore, United is the No. 1 carrier in five of its hub markets, and in and LA and DC, it is No. 2.
United Airlines doesn't have many weak points in its route network today. Image source: The Motley Fool.
It would be hard to justify United shrinking its footprint in the five markets where it is the top carrier. The main decision facing Kirby and the rest of United's management is whether to downsize or eliminate the smaller hubs in Los Angeles and Washington, D.C.
Obviously, those are both important markets for business travelers. On the other hand, they don't have clear strategic value within United's current route network. Instead, they siphon traffic away from United's stronger hubs in San Francisco and New York.
Thus, Scott Kirby and the rest of United's management team need to make tough choices about whether it's still worthwhile to maintain hubs in Los Angeles and Washington, D.C. United has scheduled an investor day conference for mid-November, and investors will likely learn a lot more about the company's future network strategy then.
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Adam Levine-Weinberg owns shares of United Continental Holdings and is long January 2017 $30 calls on American Airlines Group. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The biggest coup of all was poaching Scott Kirby from American Airlines (NASDAQ: AAL) to serve as United's president, a role with broad responsibilities across sales, planning, and operations. A lofty reputation Scott Kirby and American Airlines CEO Doug Parker made their names more than a decade ago, when they led America West's takeover of larger rival US Airways. The main decision facing Kirby and the rest of United's management is whether to downsize or eliminate the smaller hubs in Los Angeles and Washington, D.C. Obviously, those are both important markets for business travelers.
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The biggest coup of all was poaching Scott Kirby from American Airlines (NASDAQ: AAL) to serve as United's president, a role with broad responsibilities across sales, planning, and operations. Unit revenue soared as Scott Kirby remade US Airways' route network a decade ago. There's no magic wand American Airlines' performance over the past few years shows that while Scott Kirby is good at revenue management, he doesn't have a magic wand.
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The biggest coup of all was poaching Scott Kirby from American Airlines (NASDAQ: AAL) to serve as United's president, a role with broad responsibilities across sales, planning, and operations. Unit revenue soared as Scott Kirby remade US Airways' route network a decade ago. Last year, American actually underperformed United on the unit revenue front.
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The biggest coup of all was poaching Scott Kirby from American Airlines (NASDAQ: AAL) to serve as United's president, a role with broad responsibilities across sales, planning, and operations. Furthermore, United is the No. Thus, Scott Kirby and the rest of United's management team need to make tough choices about whether it's still worthwhile to maintain hubs in Los Angeles and Washington, D.C. United has scheduled an investor day conference for mid-November, and investors will likely learn a lot more about the company's future network strategy then.
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7798.0
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2016-10-12 00:00:00 UTC
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New Strong Sell Stocks for October 12th
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AAL
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https://www.nasdaq.com/articles/new-strong-sell-stocks-for-october-12th-2016-10-12
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nan
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nan
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Here are 5 stocks added to the Zacks Rank #5 (Strong Sell) List today:
• American Airlines Group Inc.AAL through its subsidiaries, operates in the airline industry. The Zacks Consensus Estimate for its current year earnings has been revised 0.1% downward over the last 30 days.
• CAI International Inc.CAI operates as transportation finance and logistics company in the United States and internationally. The Zacks Consensus Estimate for its current year earnings has declined 2.1% over the last 30 days.
• Delek US Holdings, Inc.DK operates as an integrated energy company that operates in petroleum refining, wholesale distribution, and convenience store retailing businesses. It has seen the Zacks Consensus Estimate for its current year earnings being revised 8.7% downward over the last 30 days.
• Diebold, IncorporatedDBD provides financial self-service delivery, integrated services and software, and security systems primarily to the financial, commercial, retail, and other markets. The Zacks Consensus Estimate revision for its current year earnings was a negative of 9.2% over the last 30 days.
• Global Partners LPGLP is a midstream logistics and marketing company that distributes gasoline, distillates, residual oil, and renewable fuels to wholesalers, retailers, and commercial customers. The Zacks Consensus Estimate for its current year earnings has moved 1.6% lower over the last 30 days.
View the entire Zacks Rank #5 List
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
DIEBOLD INC (DBD): Free Stock Analysis Report
DELEK US HLDGS (DK): Free Stock Analysis Report
GLOBAL PARTNERS (GLP): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
CAI INTL INC (CAI): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Here are 5 stocks added to the Zacks Rank #5 (Strong Sell) List today: • American Airlines Group Inc.AAL through its subsidiaries, operates in the airline industry. Click to get this free report DIEBOLD INC (DBD): Free Stock Analysis Report DELEK US HLDGS (DK): Free Stock Analysis Report GLOBAL PARTNERS (GLP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report CAI INTL INC (CAI): Free Stock Analysis Report To read this article on Zacks.com click here. The Zacks Consensus Estimate revision for its current year earnings was a negative of 9.2% over the last 30 days.
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Click to get this free report DIEBOLD INC (DBD): Free Stock Analysis Report DELEK US HLDGS (DK): Free Stock Analysis Report GLOBAL PARTNERS (GLP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report CAI INTL INC (CAI): Free Stock Analysis Report To read this article on Zacks.com click here. Here are 5 stocks added to the Zacks Rank #5 (Strong Sell) List today: • American Airlines Group Inc.AAL through its subsidiaries, operates in the airline industry. The Zacks Consensus Estimate revision for its current year earnings was a negative of 9.2% over the last 30 days.
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Click to get this free report DIEBOLD INC (DBD): Free Stock Analysis Report DELEK US HLDGS (DK): Free Stock Analysis Report GLOBAL PARTNERS (GLP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report CAI INTL INC (CAI): Free Stock Analysis Report To read this article on Zacks.com click here. Here are 5 stocks added to the Zacks Rank #5 (Strong Sell) List today: • American Airlines Group Inc.AAL through its subsidiaries, operates in the airline industry. The Zacks Consensus Estimate for its current year earnings has been revised 0.1% downward over the last 30 days.
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Here are 5 stocks added to the Zacks Rank #5 (Strong Sell) List today: • American Airlines Group Inc.AAL through its subsidiaries, operates in the airline industry. Click to get this free report DIEBOLD INC (DBD): Free Stock Analysis Report DELEK US HLDGS (DK): Free Stock Analysis Report GLOBAL PARTNERS (GLP): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report CAI INTL INC (CAI): Free Stock Analysis Report To read this article on Zacks.com click here. • Delek US Holdings, Inc.DK operates as an integrated energy company that operates in petroleum refining, wholesale distribution, and convenience store retailing businesses.
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7799.0
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2016-10-12 00:00:00 UTC
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What Will the Q3 Earnings Season Bring?
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AAL
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https://www.nasdaq.com/articles/what-will-q3-earnings-season-bring-2016-10-12-0
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nan
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nan
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Note: The following is an excerpt from this week's Earnings Trends report. You can access the full report that contains detailed historical actuals and estimates for the current and following periods, please click here>>>
The Q3 earnings season ramps up in the coming days, with many in the market looking for this reporting cycle to confirm the modest improvements in the overall earnings picture in the preceding earnings season. Earnings growth was negative in Q2 - the 5th quarter in a row of earnings declines for the S&P 500 index - and current expectations are for a -2.9% decline in Q3. But the expectation is that the worst is behind us now, with the picture expected to improve in the coming periods. Driving this favorable view are three key points.
First, the magnitude of negative revisions that Q3 estimates suffered were lower compared to what we had seen in the preceding quarters. Estimates for Q3 came down as companies reported Q2 results and guided lower, with expectations of earnings growth for the S&P 500 index dropping from an essentially flat reading at the beginning of July to the current -2.9%. This is a lower drop than we became used to seeing in the comparable periods in the preceding quarters.
Second, the -2.9% decline in Q3 earnings on +1.2% higher revenues will be the lowest decline rate expected at the start of the season. At the comparable stage in the Q2 earnings season, earnings growth for the S&P 500 index was expected to be -6.2%, which actually turned out to be -2.8%. We had similarly bigger decline rates expected at the start of earnings season in Q1 and the quarters prior to that, with actual earnings growth rates coming in better than pre-season expectations by about +2% to +3%. If Q3 results follow this trend, the finally growth tally will most likely be close to a flat finish, even in positive territory.
Third, the Energy sector still remains a big drag on the aggregate growth picture, with total earnings for the sector expected to be down -68.3% from the same period last year. Excluding the Energy sector, total earnings for the S&P 500 would be modestly in positive territory, up +0.3%. The Energy sector still has plenty of challenges, but the tyranny of tough comparisons is starting to fade. It is a smaller burden in Q3 than was the case in either of the preceding two quarters and comparisons are expected to turn positive in the following earnings season.
Standout Sectors this Earnings season
Earnings growth is expected to be negative for half of the 16 Zacks sectors, led by Energy (- 68.3%), Transportation (- 21.4%), and Autos (- 18.5%). The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ( AAL ) and United Continental ( UAL ) that are experiencing higher costs following recent labor contract awards. The Auto sector's growth issue is primarily due to Ford ( F ), which guided lower the last earnings season.
Growth is expected to be negative for the Technology sector as well, with total earnings for the sector expected to be down -1.8% from the same period last year on -1.1% lower revenues. The Tech growth challenge is primarily concentrated in Apple ( AAPL ) whose September-quarter earnings are expected to be down -20.7% on -9.6% lower revenues. Excluding Apple, the sector's Q3 earnings would be up +3.0% on +0.5% higher revenues.
On the positive side of the ledger, we have Construction (+6.3% earnings growth in Q3), Business Services (+7.1%), Retail (+4.4%), Utilities (+4.8%) and Finance (+4%).
Estimates Beyond Q3
The chart below shows Q3 growth expectations contrasted with what was actually achieved in the preceding four quarters and estimates for the following four periods. Full-year 2016 earnings growth expectations are now negative, similar to what we saw the year before.
As you can see, positive growth is expected to resume in Q4 and ramp up in the following quarters. Earnings growth is expected to be in double-digits in 2017 and the following year.
Easier comparisons for the Energy sector arrive in Q4, when the sector's earnings growth turns positive. But the expected growth in Q4 and beyond isn't solely a function of easy comparisons for the Energy sector - the expectation is for positive momentum from a broad cross section of sectors. Those expectations will most likely need to come down. But it will be interesting to see to what extent they will have to come down.
Note: Sheraz Mian manages the Zacks equity research department. He is an acknowledged earnings expert whose commentaries and analyses appear on Zacks.com and in the print and electronic media. His weekly earnings related articles includeEarnings Trends andEarnings Preview. He manages the Zacks Top 10 and Focus Listportfolios and writes the Weekly Market Analysisarticle for Zacks Premium subscribers.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
UNITED CONT HLD (UAL): Free Stock Analysis Report
FORD MOTOR CO (F): Free Stock Analysis Report
APPLE INC (AAPL): Free Stock Analysis Report
AMER AIRLINES (AAL): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ( AAL ) and United Continental ( UAL ) that are experiencing higher costs following recent labor contract awards. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Estimates for Q3 came down as companies reported Q2 results and guided lower, with expectations of earnings growth for the S&P 500 index dropping from an essentially flat reading at the beginning of July to the current -2.9%.
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Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ( AAL ) and United Continental ( UAL ) that are experiencing higher costs following recent labor contract awards. We had similarly bigger decline rates expected at the start of earnings season in Q1 and the quarters prior to that, with actual earnings growth rates coming in better than pre-season expectations by about +2% to +3%.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ( AAL ) and United Continental ( UAL ) that are experiencing higher costs following recent labor contract awards. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. We had similarly bigger decline rates expected at the start of earnings season in Q1 and the quarters prior to that, with actual earnings growth rates coming in better than pre-season expectations by about +2% to +3%.
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The Transportation decline is primarily concentrated in the legacy air carriers, particularly American Airlines ( AAL ) and United Continental ( UAL ) that are experiencing higher costs following recent labor contract awards. Click to get this free report UNITED CONT HLD (UAL): Free Stock Analysis Report FORD MOTOR CO (F): Free Stock Analysis Report APPLE INC (AAPL): Free Stock Analysis Report AMER AIRLINES (AAL): Free Stock Analysis Report To read this article on Zacks.com click here. Standout Sectors this Earnings season Earnings growth is expected to be negative for half of the 16 Zacks sectors, led by Energy (- 68.3%), Transportation (- 21.4%), and Autos (- 18.5%).
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