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Copa Holdings (CPA) April Traffic Drops 67% From 2019 Levels

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Amid persistent weakness in air-travel demand due to coronavirus-induced woes, Copa Holdings’ (CPA - Free Report) traffic, measured in revenue passenger miles (RPMs), declined 67% from the 2019 levels to 559.4 million in April 2021.

To align its network with this low-demand scenario, the airline is reducing capacity. Measured in available seat miles (ASMs), capacity plunged 61.9% from the 2019 levels to 768 million. With traffic declining more than the amount of capacity contraction, load factor (percentage of seats filled with passengers) deteriorated 11.3 percentage points to 72.8% in April.

Copa Holdings’ operations are being significantly hurt by coronavirus-led travel restrictions and suppressed demand. Its first-quarter 2021 results bear testimony to this bleak scenario. During the first quarter, the carrier incurred a loss (excluding 37 cents from non-recurring items) of $2.23 per share. Moreover, quarterly revenues of $185.7 million plunged 68.8% year over year, with passenger revenues (contributed 93.2% to the top line) declining 69.9%. Results were hurt by coronavirus-induced limited flight operations.  The company’s flight operations were only 39% of the 2019 (pre-pandemic) level in the quarter. Due to coronavirus-led woes, the company incurred losses in four consecutive quarters.

Zacks Rank & Key Picks

Copa Holdings carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are ArcBest Corporation (ARCB - Free Report) , C.H. Robinson Worldwide (CHRW - Free Report) and United Parcel Service (UPS - Free Report) . While ArcBest sports a Zacks Rank #1 (Strong Buy), C.H. Robinson and UPS carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of ArcBest, C.H. Robinson and UPS have rallied more than 300%, 28% and 100% in a year’s time respectively.

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