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Copa Holdings, S.A. (CPA) - free report >>
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Virgin America (VA) Posts Impressive August Traffic Growth
Virgin America Inc. displayed commendable growth in air traffic in the month of August. Traffic – measured in revenue passenger miles (RPMs) – came in at 1.14 billion, up 19.9% from 954.1 million recorded in the comparable month a year ago. Also, consolidated capacity (or available seat miles/ASMs) increased 16.4% on a year-over-year basis to 1.33 billion.
On the other hand, load factor or percentage of seats filled by passengers went up to 86.1% in August from 83.6% in the year-ago month. This was mainly because traffic growth outpaced capacity expansion. Additionally, passenger count in the month grew 14.8%.
In the first eight months of 2016, Virgin America generated RPMs of 8.09 billion and ASMs of 9.62 billion. Meanwhile, load factor was 84.1% against 83.2% a year ago.
Virgin America’s traffic growth can be attributed to an increase in vacationers as the summer holiday period ends in the U.S. The company has also been making consistent efforts to expand its operations and improve customer service.
We are also optimistic about Virgin America’s impending acquisition by Alaska Air Group, Inc. (ALK - Free Report) . The deal is expected to close by the end of this year. However, according to media reports, a lawsuit filed by 42 consumers might create an issue for the airline companies to complete the transaction on time.
Zacks Rank and Stocks to Consider
Virgin America currently carries a Zacks Rank #5 (Strong Sell). A stock in this industry with Zacks Rank #1 (Strong Buy) is Copa Holdings SA (CPA - Free Report) .You can see the complete list of today’s Zacks #1 Rank stocks here. Another well-ranked stocks in the airline space is SkyWest Inc. (SKYW - Free Report) with a Zacks Rank #2 (Buy).
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