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United Airlines (UAL) Inks Agreement With Boom Supersonic

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United Airlines (UAL - Free Report) announced an agreement with Denver based aerospace company — Boom Supersonic, to add supersonic aircrafts to its fleet. By doing so, United Airlines becomes the first U.S.- based airline to ink a deal with Boom Supersonic.

Under this deal, United Airlines will buy 15 of Boom's 'Overture' aircrafts, provided they meet the carriers’ safety, operating and sustainability requirements. The airline also signed up for an option to purchase a further 35 of the supersonic jets if things go well.

Overture is expected to be the first large commercial aircraft to be net-zero carbon from day one, optimized to run on 100% sustainable aviation fuel (SAF). The plane is designed to travel at 1.7 times the speed of sound and cover the Newark to London trip in around 3.5 hours. Few other future potential routes include Newark to Frankfurt (in four hours) and San Francisco to Tokyo (in six hours). Boom anticipates that Overture jets will be in the air by 2026 and operational by 2029.

Through the impending introduction of supersonic flights, this Chicago-based carrier aims to reduce travel times by half. This customer-friendly arrangement is likely to attract additional traffic.

Post materialization of the deal, United Airlines will be able to modernize its fleet more efficiently. The use of 100% SAF by Overture will help the carrier achieve its goal (to become 100% green by 2050) effectively.

Zacks Rank & Stocks to Consider

United Airlines currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Transportation sector include Landstar System, Inc. (LSTR - Free Report) , Triton International Limited (TRTN - Free Report) and Herc Holdings Inc. (HRI - Free Report) . Herc Holdings and Landstar sport a Zacks Rank #1 (Strong Buy), while Triton carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term (three to five years) expected earnings per share growth rate for Landstar, Triton and Herc Holdings is projected at 12%, 10% and 42.9%, respectively.

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