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Will JetBlue (JBLU) Q2 Earnings Let Down Investors?
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Low-cost carrier JetBlue Airways Corporation (JBLU - Free Report) is scheduled to report second-quarter 2016 results on Jul 26, before market opens.
In the prior quarter, the Long Island City, NY-based carrier posted a positive earnings surprise of 11.32%. The company has a decent track record with respect to earnings, having outpaced the Zacks Consensus Estimate in three of the last four quarters. The average earnings beat being 5.72%.
Factors to Consider
JetBlue has been impacted by of the recent terror attacks and unfavorable macroeconomic factors which have resulted in lower demand. The company’s top line is likely to suffer due to declining average ticket prices, as has been the case for airlines such as a Southwest Airlines Co. (LUV - Free Report) and United Continental Holdings Inc. (UAL - Free Report) . Across the board, airlines have been struggling with declining consolidated Passenger Revenue per Available Seat Mile (PRASM).
Meanwhile, JetBlue’s bottom line will likely be boosted by low oil prices, as has been the case for most airlines. Moreover, the company should benefit from route expansion and new initiatives to improve customer service. However, it remains to be seen how the company performs in a challenging environment.
Our proven model does not predict an earnings beat for JetBlue this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: JetBlue has an Earnings ESP of -4.08% as the Most Accurate estimate stands at 47 cents while the Zacks Consensus Estimate is pegged at 49 cents.
Zacks Rank: JetBlue currently has a Zacks Rank #5 (Strong Sell). Please note that 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, as is the case with JetBlue.
Stock to Consider
Here is a company you may want to consider instead, as our model shows that it has the right combination of elements to post an earnings beat this quarter:
LATAM Airlines Group Inc. , with an earnings ESP of over 100% and a Zacks Rank #2.
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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Will JetBlue (JBLU) Q2 Earnings Let Down Investors?
Low-cost carrier JetBlue Airways Corporation (JBLU - Free Report) is scheduled to report second-quarter 2016 results on Jul 26, before market opens.
In the prior quarter, the Long Island City, NY-based carrier posted a positive earnings surprise of 11.32%. The company has a decent track record with respect to earnings, having outpaced the Zacks Consensus Estimate in three of the last four quarters. The average earnings beat being 5.72%.
Factors to Consider
JetBlue has been impacted by of the recent terror attacks and unfavorable macroeconomic factors which have resulted in lower demand. The company’s top line is likely to suffer due to declining average ticket prices, as has been the case for airlines such as a Southwest Airlines Co. (LUV - Free Report) and United Continental Holdings Inc. (UAL - Free Report) . Across the board, airlines have been struggling with declining consolidated Passenger Revenue per Available Seat Mile (PRASM).
Meanwhile, JetBlue’s bottom line will likely be boosted by low oil prices, as has been the case for most airlines. Moreover, the company should benefit from route expansion and new initiatives to improve customer service. However, it remains to be seen how the company performs in a challenging environment.
JETBLUE AIRWAYS Price and EPS Surprise
JETBLUE AIRWAYS Price and EPS Surprise | JETBLUE AIRWAYS Quote
Earnings Whispers
Our proven model does not predict an earnings beat for JetBlue this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: JetBlue has an Earnings ESP of -4.08% as the Most Accurate estimate stands at 47 cents while the Zacks Consensus Estimate is pegged at 49 cents.
Zacks Rank: JetBlue currently has a Zacks Rank #5 (Strong Sell). Please note that 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, as is the case with JetBlue.
Stock to Consider
Here is a company you may want to consider instead, as our model shows that it has the right combination of elements to post an earnings beat this quarter:
LATAM Airlines Group Inc. , with an earnings ESP of over 100% and a Zacks Rank #2.
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 >>