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Why Is JetBlue (JBLU) Down 1.7% Since Last Earnings Report?

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It has been about a month since the last earnings report for JetBlue Airways (JBLU - Free Report) . Shares have lost about 1.7% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is JetBlue due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

JetBlue Posts Q1 Loss

JetBlue's first-quarter 2023 loss (excluding 24 cents from non-recurring items) of 34 cents per share was narrower than the Zacks Consensus Estimate of a loss of 38 cents. In the year-ago quarter, JBLU incurred a loss of 80 cents per share.  

Operating revenues of $2,328 million climbed 34.1% year over year and beat the Zacks Consensus Estimate of $2,322.5 million. The double-digit year-over-year jump reflected improving air-travel demand.

Passenger revenues, accounting for the bulk of the top line (93.7%), increased to $2,182 million in first-quarter 2023 from $1,603 million a year ago when air-travel demand was not so robust. Other revenues rose 9.4% to $146 million.

Other Details

All comparisons are presented on a year-over-year basis.

Revenue per available seat mile (a key measure of unit revenues) in the reported quarter improved 23% to 13.88 cents. Passenger revenue per available seat mile rose 24.9% to 13.01 cents owing to better air-travel demand.

Average fare at JetBlue during the March quarter increased 9.2% to $214.07. Yield per passenger mile shot up 11.2% to 16.31 cents.

Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) improved 22.4% in the quarter under review. To cater to this increased demand, capacity (measured in available seat miles) increased 9% to 16,769 million. Consolidated load factor (percentage of seats filled by passengers) increased 8.8 points to 79.8% as traffic growth outpaced capacity expansion.

In the March quarter, total operating expenses (on a reported basis) escalated 22.2% to $2,570 million, mainly due to a 34.1% rise in aircraft fuel expenses and related taxes. Average fuel price per gallon (including fuel taxes) climbed to $3.50 from $2.90 a year ago, as oil prices move north.

JBLU’s operating expenses per available seat mile (CASM) increased 12.1% to 15.32 cents. Excluding fuel, CASM inched up 1.2% to 9.99 cents.

JetBlue exited the March quarter with cash and cash equivalents of $1,333 million compared with $1,042 million at the end of 2022. Total debt at the end of the reported quarter was $3,579 million compared with $3,647 million at 2022 end. During the quarter, JBLU paid off $109 million of debt and finance lease obligations.


While providing guidance for second-quarter 2023, management stated that all comparisons are made with respect to second-quarter 2022 figures.

Capacity is anticipated to increase in the 4.5-7.5% range. CASM, excluding fuel and special items, is predicted to rise 1.5-3.5%.

Total revenues are forecast to increase in the 4.5-8.5% range. Average fuel cost per gallon in the June quarter is estimated to be between $2.75 and $2.90.

Interest expense is forecast in the $40-$50 million range. Management expects second-quarter 2023 earnings in the range of 35-45 cents per share. 

For full-year 2023, capacity is expected to increase in the band of 5.5-8.5% from the 2022 actuals. CASM, excluding fuel and special items, is predicted to rise 1.5-4.5% from the 2022 actuals. Current-year interest expense is forecast in the $200-$210 million band.

Total revenues for 2023 are forecast to increase year over year in the high single-digit to low double-digit range. Management expects 2023 earnings per share to be between 70 cents and $1.00. Capital expenditure is projected around $1.3 billion.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates revision.

The consensus estimate has shifted 48.3% due to these changes.

VGM Scores

Currently, JetBlue has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, JetBlue has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

JetBlue belongs to the Zacks Transportation - Airline industry. Another stock from the same industry, Alaska Air Group (ALK - Free Report) , has gained 4.2% over the past month. More than a month has passed since the company reported results for the quarter ended March 2023.

Alaska Air reported revenues of $2.2 billion in the last reported quarter, representing a year-over-year change of +30.6%. EPS of -$0.62 for the same period compares with -$1.33 a year ago.

For the current quarter, Alaska Air is expected to post earnings of $2.49 per share, indicating a change of +13.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +6.6% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Alaska Air. Also, the stock has a VGM Score of A.

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