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Airline Stock Roundup: ALK's July Traffic, LUV's Pet Policy, AAL & HA in Focus
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In the past week, Alaska Air Group, Inc. (ALK - Free Report) reported impressive traffic figures for July backed by solid demand for air travel. Southwest Airlines Co. (LUV - Free Report) also featured in the news, when this Dallas-based company joined fellow-carriers like JetBlue Airways Corporation (JBLU - Free Report) in revamping its policy pertaining to emotional support animals on its flights.
Meanwhile, American Airlines Group Inc. (AAL - Free Report) and Hawaiian Airlines — a subsidiary of Hawaiian Holdings, Inc. (HA - Free Report) — announced decisions to trim their respective services to China.
Furthermore, Delta Air Lines (DAL - Free Report) strengthened its ties with the Nairobi-based Kenya Airways by entering into a bilateral codeshare agreement. On the price front, the NYSE ARCA Airline Index gained 2.6% over the last five trading days, courtesy of decrease in oil prices.
1. At Alaska Air Group, traffic — measured in revenue passenger miles (RPMs) — increased 7.6% to 5.24 billion.On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) rose 6.8% to 5.97 billion. Also, load factor or percentage of seats filled by passengers expanded 70 basis points (bps) to 87.7% as traffic growth outpaced capacity expansion.
In the first seven months of 2018, the carrier generated RPMs of 32.12 billion (up 6.6% year over year) and ASMs of 38.28 billion (up 7.5% year over year). However, load factor declined 70 bps to 83.9%(read more: Alaska Air Posts Solid July Traffic Despite Fuel Cost Woes).
2. In a customer-friendly move, Delta entered into a bilateral codeshare agreement with the Kenya Airways. The deal is aimed at facilitating travel between the United States and Kenya. Passengers will enjoy a one-stop seamless travel experience from the United States as a result of the codeshare partnership(read more: Delta, Kenya Airways Ink Codeshare Pact, Strengthen Ties).
3. Southwest Airlines revamped its emotional-support animal policy after a child was bitten a dog on one of its flights. The new policy, effective Sep 17, permits a passenger to carry only one cat or dog (either in a carrier or on a leash) as an emotional support animal on Southwest Airlines’ flights. As part of tightening its policy, this low-cost carrier will ask the relevant passengers to provide extensive documentation pertaining to the animal on the day of the flight. Passengers will not be allowed to board the flight with an exotic or unusual animal.
The new policy also allows passengers to carry only dogs, cats and sometimes miniature horses as psychiatric-support animals. The animals must be trained to assist or work for a person suffering from mental-health disability.
4. In a bid to boost its profitability in the current scenario of rising oil prices, American Airlines announced certain route changes. The carrier has decided to strengthen its European footprint by deciding to introduce nine new routes next summer, with new service to destinations like Munich, Dublin and Berlin. However, it has decided to discontinue the unprofitable Chicago-Shanghai route in October. American Airlines cited rising fuel costs as a reason for its decision, apart from intense competition from Chinese carriers.
The carrier has also decided to operate flights between O'Hare and Japan’s Narita International Airport three days a week in December. Currently, American Airlines’ flights on the route operate on a daily basis.
5. Hawaiian Airlines will not operate the existing thrice a week nonstop flights connecting Honolulu and Beijing. The service, operational since April 2014, will be discontinued after the Oct 1-Oct 7 week (National Day Golden week).The decision to discontinue the route might be due to lower-than-expected passenger demand growth.
Performance
The following table shows the price movement of the major airline players over the past week and during the last 6 months.
Company
Past Week
Last 6 months
HA
3.1%
18.9%
UAL
5.5%
28.4%
GOL
-11.7%
-49.5%
DAL
4.3%
9.6%
JBLU
4.3%
-7.9%
AAL
7.7%
-23.9%
SAVE
4.7%
18.2%
LUV
1.1%
6.4%
CPA
-5.1%
-38.4%
ALK
4.5%
3.8%
The table above shows that most airline stocks traded in the green over the past week resulting in the NYSE ARCA Airline Index gaining. Shares of American Airlines appreciated the most (7.7%). Over the course of six months, the sector tracker depreciated 8.7% with shares of GOL Linhas declining the most (49.5%).
What's Next in the Airline Space?
Stay tuned for usual news updates in the space.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Airline Stock Roundup: ALK's July Traffic, LUV's Pet Policy, AAL & HA in Focus
In the past week, Alaska Air Group, Inc. (ALK - Free Report) reported impressive traffic figures for July backed by solid demand for air travel. Southwest Airlines Co. (LUV - Free Report) also featured in the news, when this Dallas-based company joined fellow-carriers like JetBlue Airways Corporation (JBLU - Free Report) in revamping its policy pertaining to emotional support animals on its flights.
Meanwhile, American Airlines Group Inc. (AAL - Free Report) and Hawaiian Airlines — a subsidiary of Hawaiian Holdings, Inc. (HA - Free Report) — announced decisions to trim their respective services to China.
Furthermore, Delta Air Lines (DAL - Free Report) strengthened its ties with the Nairobi-based Kenya Airways by entering into a bilateral codeshare agreement. On the price front, the NYSE ARCA Airline Index gained 2.6% over the last five trading days, courtesy of decrease in oil prices.
(Read the last Airline Stock Roundup for Aug 14, 2018).
Recap of the Past Week’s Most Important Stories
1. At Alaska Air Group, traffic — measured in revenue passenger miles (RPMs) — increased 7.6% to 5.24 billion.On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) rose 6.8% to 5.97 billion. Also, load factor or percentage of seats filled by passengers expanded 70 basis points (bps) to 87.7% as traffic growth outpaced capacity expansion.
In the first seven months of 2018, the carrier generated RPMs of 32.12 billion (up 6.6% year over year) and ASMs of 38.28 billion (up 7.5% year over year). However, load factor declined 70 bps to 83.9%(read more: Alaska Air Posts Solid July Traffic Despite Fuel Cost Woes).
2. In a customer-friendly move, Delta entered into a bilateral codeshare agreement with the Kenya Airways. The deal is aimed at facilitating travel between the United States and Kenya. Passengers will enjoy a one-stop seamless travel experience from the United States as a result of the codeshare partnership(read more: Delta, Kenya Airways Ink Codeshare Pact, Strengthen Ties).
Delta carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
3. Southwest Airlines revamped its emotional-support animal policy after a child was bitten a dog on one of its flights. The new policy, effective Sep 17, permits a passenger to carry only one cat or dog (either in a carrier or on a leash) as an emotional support animal on Southwest Airlines’ flights. As part of tightening its policy, this low-cost carrier will ask the relevant passengers to provide extensive documentation pertaining to the animal on the day of the flight. Passengers will not be allowed to board the flight with an exotic or unusual animal.
The new policy also allows passengers to carry only dogs, cats and sometimes miniature horses as psychiatric-support animals. The animals must be trained to assist or work for a person suffering from mental-health disability.
4. In a bid to boost its profitability in the current scenario of rising oil prices, American Airlines announced certain route changes. The carrier has decided to strengthen its European footprint by deciding to introduce nine new routes next summer, with new service to destinations like Munich, Dublin and Berlin. However, it has decided to discontinue the unprofitable Chicago-Shanghai route in October. American Airlines cited rising fuel costs as a reason for its decision, apart from intense competition from Chinese carriers.
The carrier has also decided to operate flights between O'Hare and Japan’s Narita International Airport three days a week in December. Currently, American Airlines’ flights on the route operate on a daily basis.
5. Hawaiian Airlines will not operate the existing thrice a week nonstop flights connecting Honolulu and Beijing. The service, operational since April 2014, will be discontinued after the Oct 1-Oct 7 week (National Day Golden week).The decision to discontinue the route might be due to lower-than-expected passenger demand growth.
Performance
The following table shows the price movement of the major airline players over the past week and during the last 6 months.
Company
Past Week
Last 6 months
HA
3.1%
18.9%
UAL
5.5%
28.4%
GOL
-11.7%
-49.5%
DAL
4.3%
9.6%
JBLU
4.3%
-7.9%
AAL
7.7%
-23.9%
SAVE
4.7%
18.2%
LUV
1.1%
6.4%
CPA
-5.1%
-38.4%
ALK
4.5%
3.8%
The table above shows that most airline stocks traded in the green over the past week resulting in the NYSE ARCA Airline Index gaining. Shares of American Airlines appreciated the most (7.7%). Over the course of six months, the sector tracker depreciated 8.7% with shares of GOL Linhas declining the most (49.5%).
What's Next in the Airline Space?
Stay tuned for usual news updates in the space.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>