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Southwest Airlines (LUV) Pilots Vote in Favor of Strike
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Southwest Airlines’ (LUV - Free Report) pilots have overwhelmingly voted in favor of strike. This heightened labor-related tensions for the Dallas-based company. Per the Southwest Pilots Association, the voting procedure (whose duration was more than a week) saw 98% of the total pilots cast their votes. Of them 99% pilots voted in favor of a strike.
The union raised its voice against the lack of progress after three-plus years of negotiations that has led to many operational disasters at LUV. Casey Murray, the president of the union, said, "Our pilots are tired of apologizing to our passengers on behalf of a company that refuses to place its priorities on its internal and external customers."
Even though pilots have voted in favor of a strike it is highly doubtful that the same will materialize eventually as the law makes it extremely difficult. So negotiations are likely to continue. The union hopes that this strike approval will exert pressure on the airline in the ongoing negotiations. However, the union has assured that scheduled operations will not be impacted.
This move by the pilots increases problems at LUV, which has already been struggling due to the December 2022 operational disruption. The unfavorable impact owing to massive flight cancellations resulted in the carrier incurring loss in first-quarter 2023.
Mainly due to operational disruptions, shares of Southwest Airlines have declined 14% year to date. This compares unfavorably to the Zacks Airline industry's 6.1% appreciation in the same timeframe.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Southwest Airlines currently carries a Zacks Rank #3 (Hold).
Copa Holdings is benefiting from an improvement in air-travel demand. In first-quarter 2023, passenger revenues increased 28.5% from first-quarter 2019 levels due to higher yields.
CPA’s focus on its cargo segment is encouraging. In first-quarter 2023, cargo and mail revenues grew 51.8% from the comparable quarter of 2019 on higher cargo volumes and yields.
Copa Holdings' fleet modernization and cost-management efforts are commendable as well. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 6.15% upward over the past 60 days.
United Airlines is seeing steady recovery in domestic and international air-travel demand. Owing to robust air-travel demand, UAL expects revenues for the June quarter to grow 14-16% year over year.
For 2023, United Airlines expects capacity to be in the high teens. The Zacks Consensus Estimate for current-year earnings has been revised 9% upward in the past 60 days.
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Southwest Airlines (LUV) Pilots Vote in Favor of Strike
Southwest Airlines’ (LUV - Free Report) pilots have overwhelmingly voted in favor of strike. This heightened labor-related tensions for the Dallas-based company. Per the Southwest Pilots Association, the voting procedure (whose duration was more than a week) saw 98% of the total pilots cast their votes. Of them 99% pilots voted in favor of a strike.
The union raised its voice against the lack of progress after three-plus years of negotiations that has led to many operational disasters at LUV. Casey Murray, the president of the union, said, "Our pilots are tired of apologizing to our passengers on behalf of a company that refuses to place its priorities on its internal and external customers."
Even though pilots have voted in favor of a strike it is highly doubtful that the same will materialize eventually as the law makes it extremely difficult. So negotiations are likely to continue. The union hopes that this strike approval will exert pressure on the airline in the ongoing negotiations. However, the union has assured that scheduled operations will not be impacted.
This move by the pilots increases problems at LUV, which has already been struggling due to the December 2022 operational disruption. The unfavorable impact owing to massive flight cancellations resulted in the carrier incurring loss in first-quarter 2023.
Mainly due to operational disruptions, shares of Southwest Airlines have declined 14% year to date. This compares unfavorably to the Zacks Airline industry's 6.1% appreciation in the same timeframe.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Southwest Airlines currently carries a Zacks Rank #3 (Hold).
Investors interested in the Zacks Airline industry may consider stocks like Copa Holdings (CPA - Free Report) and United Airlines (UAL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Copa Holdings is benefiting from an improvement in air-travel demand. In first-quarter 2023, passenger revenues increased 28.5% from first-quarter 2019 levels due to higher yields.
CPA’s focus on its cargo segment is encouraging. In first-quarter 2023, cargo and mail revenues grew 51.8% from the comparable quarter of 2019 on higher cargo volumes and yields.
Copa Holdings' fleet modernization and cost-management efforts are commendable as well. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 6.15% upward over the past 60 days.
United Airlines is seeing steady recovery in domestic and international air-travel demand. Owing to robust air-travel demand, UAL expects revenues for the June quarter to grow 14-16% year over year.
For 2023, United Airlines expects capacity to be in the high teens. The Zacks Consensus Estimate for current-year earnings has been revised 9% upward in the past 60 days.