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Here's Why Gol Linhas (GOL) Should Be in Your Portfolio
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The increasing air travel demand and increased capacity utilization are shaping the future performance of Gol Linhas Aéreas Inteligentes ), predominantly in the domestic business.
Let’s delve into the factors that make it an investment-worthy stock.
Earnings Expectations:
Earnings growth and stock price gains often indicate a company’s prospects. For fourth-quarter 2022, Gol Linhas’ earnings are expected to register 69.35% growth on a year-over-year basis. For 2022 and 2023, the company’s earnings are expected to grow 52.2% and 55.31%, respectively, on a year-over-year basis.
Attractive Rank & Style Score
GOL currently carries a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, the company seems to be an appropriate investment at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Positive Factors
Gol Linhas has been benefiting from the improved air travel scenario. The effect of such improvement is clearly visible in the air traffic demand of the company.
Recently, the company published its air traffic data for January where consolidated traffic (measured in revenue passenger kilometers) increased 8.9% year over year. To match the upbeat demand situation, the company is simultaneously expanding its capacity (measured in available seat kilometers). During the same month, capacity grew 6.2% year over year. GOL carried 11.1% more passengers in January compared with the year-ago figure. Consolidated load factor (% of seats filled by passengers) improved to 84.7% in January from 82.6% a year ago.
Domestic departures, which accounted for more than 94% of total departures during the month, have grown 3.5% on a year-over-year basis. On the domestic front, the number of seats increased 3%.
The deal with American Airlines (AAL - Free Report) is also a positive. In September 2021, Gol Linhas agreed to expand its commercial deal with AAL through an exclusive codeshare agreement for the next three years to meet higher air-travel demand.
As a result of the code-sharing pact, passengers of either carrier can purchase tickets for the connecting flights using one reservation. This is expected to increase the demand for both carriers.
GOL has also acquired domestic airline MAP Transportes Aéreos Ltd, to meet additional air travel demand. The move can be expected to have a positive impact on the company’s top line.
Other Stocks to Consider
Investors interested in the Zacks Airline industry may also consider the following stocks:
Alaska Air Group, Inc. (ALK - Free Report) is being aided by the improved air travel demand situation. In the fourth quarter of 2022 ALK reported better-than-expected results. The company expects a 23-29% increase in the top line of the company during the first quarter of 2023. ALK has been increasing its capacity to meet the upbeat demand. Capacity is expected to increase 11-14% in the first quarter of 2023
The Zacks Consensus Estimate for earnings of Alaska Air, currently holding a Zacks Rank of 2, has been revised upward by 22.22% in the past 60 days.
United Airlines (UAL - Free Report) , currently carrying a Zacks Rank of 2, is seeing steady recovery in domestic and leisure air-travel demand. On the back of upbeat air-travel demand, UAL was profitable in the fourth quarter of 2022. The fourth quarter was the third consecutive profitable quarter at UAL. Driven by solid demand, management expects total revenue per available seat mile to grow almost 25% year over year in the first quarter of 2023. Total revenues are anticipated to grow almost 50% year over year.
The Zacks Consensus Estimate of the company has been revised upward by 227.5% in the past 60 days.
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Here's Why Gol Linhas (GOL) Should Be in Your Portfolio
The increasing air travel demand and increased capacity utilization are shaping the future performance of Gol Linhas Aéreas Inteligentes ), predominantly in the domestic business.
Let’s delve into the factors that make it an investment-worthy stock.
Earnings Expectations:
Earnings growth and stock price gains often indicate a company’s prospects. For fourth-quarter 2022, Gol Linhas’ earnings are expected to register 69.35% growth on a year-over-year basis. For 2022 and 2023, the company’s earnings are expected to grow 52.2% and 55.31%, respectively, on a year-over-year basis.
Attractive Rank & Style Score
GOL currently carries a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, the company seems to be an appropriate investment at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Positive Factors
Gol Linhas has been benefiting from the improved air travel scenario. The effect of such improvement is clearly visible in the air traffic demand of the company.
Recently, the company published its air traffic data for January where consolidated traffic (measured in revenue passenger kilometers) increased 8.9% year over year. To match the upbeat demand situation, the company is simultaneously expanding its capacity (measured in available seat kilometers). During the same month, capacity grew 6.2% year over year. GOL carried 11.1% more passengers in January compared with the year-ago figure. Consolidated load factor (% of seats filled by passengers) improved to 84.7% in January from 82.6% a year ago.
Domestic departures, which accounted for more than 94% of total departures during the month, have grown 3.5% on a year-over-year basis. On the domestic front, the number of seats increased 3%.
The deal with American Airlines (AAL - Free Report) is also a positive. In September 2021, Gol Linhas agreed to expand its commercial deal with AAL through an exclusive codeshare agreement for the next three years to meet higher air-travel demand.
As a result of the code-sharing pact, passengers of either carrier can purchase tickets for the connecting flights using one reservation. This is expected to increase the demand for both carriers.
GOL has also acquired domestic airline MAP Transportes Aéreos Ltd, to meet additional air travel demand. The move can be expected to have a positive impact on the company’s top line.
Other Stocks to Consider
Investors interested in the Zacks Airline industry may also consider the following stocks:
Alaska Air Group, Inc. (ALK - Free Report) is being aided by the improved air travel demand situation. In the fourth quarter of 2022 ALK reported better-than-expected results. The company expects a 23-29% increase in the top line of the company during the first quarter of 2023. ALK has been increasing its capacity to meet the upbeat demand. Capacity is expected to increase 11-14% in the first quarter of 2023
The Zacks Consensus Estimate for earnings of Alaska Air, currently holding a Zacks Rank of 2, has been revised upward by 22.22% in the past 60 days.
United Airlines (UAL - Free Report) , currently carrying a Zacks Rank of 2, is seeing steady recovery in domestic and leisure air-travel demand. On the back of upbeat air-travel demand, UAL was profitable in the fourth quarter of 2022. The fourth quarter was the third consecutive profitable quarter at UAL. Driven by solid demand, management expects total revenue per available seat mile to grow almost 25% year over year in the first quarter of 2023. Total revenues are anticipated to grow almost 50% year over year.
The Zacks Consensus Estimate of the company has been revised upward by 227.5% in the past 60 days.