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JetBlue July Traffic Rises, Stock Up on Load Factor Growth
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Shares of the Long Island City, New York-based JetBlue Airways Corporation (JBLU - Free Report) rallied after the company released its July traffic report. Revenue passenger miles (RPMs) – a measure of traffic – climbed 6.6% on a year-over-year basis to 4.26 billion. Average seat miles (ASMs) – a measure of capacity – climbed 5.5% to 4.85 billion in Jul 2016.
Load factor (% of seats filled by passengers) climbed 80 basis points to 87.8% in the month as traffic growth outpaced capacity expansion. Improvement in this key metric was the primary reason behind the surge in stock price.
The number of departures during Jul 2016 climbed 3.2%. The low-cost carrier registered a completion factor of 98%, with 67.8% of its flights on schedule. JetBlue’s preliminary revenue per available seat mile (RASM) in July dropped roughly 2.5% year over year. The decline is at the low end of its guidance of 2.5% to 3% RASM decline for July. The outlook was unveiled last month while revealing its second-quarter results. For the first seven months of 2016, JetBlue witnessed an 11.2% increase in RPMs to 26.78 billion and 11.4% rise in ASMs to 31.48 billion, both on a year-over-year basis. However, load factor declined 20 basis points to 85.1% in the month.
JetBlue is constantly making efforts to expand its operations. Recently, the carrier announced new flights connecting Long Beach and several popular destinations as part of its efforts to strengthen its presence on the west coast. Capacity for the third quarter is projected to grow in the band of 5.5% to 7.5%. Capacity for 2016 is projected to grow in the band of 8% to 9.5%. We believe that such expansion plans will draw higher traffic at JetBlue in the coming months, thereby boosting its top line.
Zacks Rank & Stocks to Consider
JetBlue currently carries a Zacks Rank #5 (Strong Sell). The bearish rank represents the broad concerns confronting the airline space. Investors interested in the broader transportation space may consider Copa Holdings (CPA - Free Report) , SkyWest Inc. (SKYW - Free Report) and Green Plains Partners LP . While Copa Holdings sports a Zack Rank #1 (Strong Buy), SkyWest and Green Plains Partners carry a Zacks Rank #2 (Buy).
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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JetBlue July Traffic Rises, Stock Up on Load Factor Growth
Shares of the Long Island City, New York-based JetBlue Airways Corporation (JBLU - Free Report) rallied after the company released its July traffic report. Revenue passenger miles (RPMs) – a measure of traffic – climbed 6.6% on a year-over-year basis to 4.26 billion. Average seat miles (ASMs) – a measure of capacity – climbed 5.5% to 4.85 billion in Jul 2016.
Load factor (% of seats filled by passengers) climbed 80 basis points to 87.8% in the month as traffic growth outpaced capacity expansion. Improvement in this key metric was the primary reason behind the surge in stock price.
JETBLUE AIRWAYS Price
JETBLUE AIRWAYS Price | JETBLUE AIRWAYS Quote
The number of departures during Jul 2016 climbed 3.2%. The low-cost carrier registered a completion factor of 98%, with 67.8% of its flights on schedule. JetBlue’s preliminary revenue per available seat mile (RASM) in July dropped roughly 2.5% year over year. The decline is at the low end of its guidance of 2.5% to 3% RASM decline for July. The outlook was unveiled last month while revealing its second-quarter results. For the first seven months of 2016, JetBlue witnessed an 11.2% increase in RPMs to 26.78 billion and 11.4% rise in ASMs to 31.48 billion, both on a year-over-year basis. However, load factor declined 20 basis points to 85.1% in the month.
JetBlue is constantly making efforts to expand its operations. Recently, the carrier announced new flights connecting Long Beach and several popular destinations as part of its efforts to strengthen its presence on the west coast. Capacity for the third quarter is projected to grow in the band of 5.5% to 7.5%. Capacity for 2016 is projected to grow in the band of 8% to 9.5%. We believe that such expansion plans will draw higher traffic at JetBlue in the coming months, thereby boosting its top line.
Zacks Rank & Stocks to Consider
JetBlue currently carries a Zacks Rank #5 (Strong Sell). The bearish rank represents the broad concerns confronting the airline space. Investors interested in the broader transportation space may consider Copa Holdings (CPA - Free Report) , SkyWest Inc. (SKYW - Free Report) and Green Plains Partners LP . While Copa Holdings sports a Zack Rank #1 (Strong Buy), SkyWest and Green Plains Partners carry a Zacks Rank #2 (Buy).
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 >>