We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
United Continental (UAL) Q1 Earnings: A Beat in the Cards?
Read MoreHide Full Article
United Continental Holdings, Inc. (UAL - Free Report) is slated to release first-quarter 2017 earnings after market closes on Apr 17.
In the last quarter, the carrier posted a positive earnings surprise of 7.88%. The company posted earnings of $1.78 per share, beating the Zacks Consensus Estimate of $1.65. Revenue of $9.10 billion also surpassed the Zacks Consensus Estimate of $9.03 billion. The bottom line, however, plunged 29.9% year over year owing to higher costs.
Despite its recent struggles following the passenger fiasco, an earnings beat does not seem to be too difficult for United Continental in the first quarter due to reduced expectations. The Zacks Consensus Estimate for the first quarter of 2017 currently stands at a highly conservative 35 cents, way below the year-ago figure of $1.17.
Our proven model also shows that United Continental is likely to beat the Zacks Consensus Estimate this quarter because it has the perfect combination of two key ingredients.
Zacks ESP: The Earnings ESP for United Continental is +2.86% as the Most Accurate estimate is pegged at 36 cents while the Zacks Consensus Estimate is at 35 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: United Continental carries a Zacks Rank #3 (Hold). Please note that stocks with Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating earnings estimates.
Meanwhile, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
Factors at Play
United Continental expects passenger revenue per available seat miles (PRASM) expects passenger unit revenues for the first quarter to be flat on a year-over-year basis. The company expects pre-tax margin (adjusted) in the band of 2%–2.5% in the first quarter.
United Continental expects consolidated capacity for the first quarter to grow 2.6% on a year-over-year basis. Moreover, first-quarter cost per available seat mile (CASM: excluding profit sharing, fuel & third party business cost) is anticipated to increase in the band of 4.75%–5.25% due to higher labor costs. We note that labor deals in the airline space are much in vogue. Delta Airlines (DAL - Free Report) and Southwest Airlines (LUV - Free Report) have inked deals with various labor groups over the past few months as well.
We are impressed by United Continental's efforts to reward its shareholders. Moreover, its efforts to modernize its fleet also raise optimism. We expect updates on the issues on the conference call. Moreover, a commentary on the passenger fiasco issue will keenly be awaited by investors.
Price Performance
The United Continental stock has struggled of late, underperforming the Zacks categorized Transportation-Airline industry in the last three months. The stock lost 5.9% while the industry registered an increase of 3.3% over the period.
The passenger debacle issue is a huge negative for the stock. In this gloomy scenario, an earnings beat is likely to provide the stock with a much-needed boost.
Another Stock to Consider
Investors interested in the broader transportation sector may also consider C.H. Robinson Worldwide, Inc. (CHRW - Free Report) as our model shows it possesses the right combination of elements to post an earnings beat in its next release.
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
United Continental (UAL) Q1 Earnings: A Beat in the Cards?
United Continental Holdings, Inc. (UAL - Free Report) is slated to release first-quarter 2017 earnings after market closes on Apr 17.
In the last quarter, the carrier posted a positive earnings surprise of 7.88%. The company posted earnings of $1.78 per share, beating the Zacks Consensus Estimate of $1.65. Revenue of $9.10 billion also surpassed the Zacks Consensus Estimate of $9.03 billion. The bottom line, however, plunged 29.9% year over year owing to higher costs.
Despite its recent struggles following the passenger fiasco, an earnings beat does not seem to be too difficult for United Continental in the first quarter due to reduced expectations. The Zacks Consensus Estimate for the first quarter of 2017 currently stands at a highly conservative 35 cents, way below the year-ago figure of $1.17.
Our proven model also shows that United Continental is likely to beat the Zacks Consensus Estimate this quarter because it has the perfect combination of two key ingredients.
Zacks ESP: The Earnings ESP for United Continental is +2.86% as the Most Accurate estimate is pegged at 36 cents while the Zacks Consensus Estimate is at 35 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: United Continental carries a Zacks Rank #3 (Hold). Please note that stocks with Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating earnings estimates.
Meanwhile, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
Factors at Play
United Continental expects passenger revenue per available seat miles (PRASM) expects passenger unit revenues for the first quarter to be flat on a year-over-year basis. The company expects pre-tax margin (adjusted) in the band of 2%–2.5% in the first quarter.
United Continental expects consolidated capacity for the first quarter to grow 2.6% on a year-over-year basis. Moreover, first-quarter cost per available seat mile (CASM: excluding profit sharing, fuel & third party business cost) is anticipated to increase in the band of 4.75%–5.25% due to higher labor costs. We note that labor deals in the airline space are much in vogue. Delta Airlines (DAL - Free Report) and Southwest Airlines (LUV - Free Report) have inked deals with various labor groups over the past few months as well.
We are impressed by United Continental's efforts to reward its shareholders. Moreover, its efforts to modernize its fleet also raise optimism. We expect updates on the issues on the conference call. Moreover, a commentary on the passenger fiasco issue will keenly be awaited by investors.
Price Performance
The United Continental stock has struggled of late, underperforming the Zacks categorized Transportation-Airline industry in the last three months. The stock lost 5.9% while the industry registered an increase of 3.3% over the period.
The passenger debacle issue is a huge negative for the stock. In this gloomy scenario, an earnings beat is likely to provide the stock with a much-needed boost.
Another Stock to Consider
Investors interested in the broader transportation sector may also consider C.H. Robinson Worldwide, Inc. (CHRW - Free Report) as our model shows it possesses the right combination of elements to post an earnings beat in its next release.
C.H. Robinson has an Earnings ESP of +1.25% and carries a Zacks Rank #3. The company will release first-quarter 2017 results on Apr 25. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Best & Worst of Zacks
Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>