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American Airlines (AAL) Beats on Q3 Earnings & Revenues
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American Airlines Group Inc.(AAL - Free Report) reported better-than-expected earnings in the third quarter of 2016. The company posted adjusted earnings per share of $2.80 that comfortably beat the Zacks Consensus Estimate of $1.68. Quarterly earnings increased more than 1% year over year.
Revenues of $10,594 million were 1.1% below the year-ago figure but edged past the Zacks Consensus Estimate of $10,549 million. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings (UAL - Free Report) and Alaska Air Group (ALK - Free Report) have also reported better-than-expected earnings and revenues in the third quarter.
Consolidated passenger revenue per available seat mile (PRASM) declined 3.3% to 12.72 cents in the reported quarter. Consolidated yield dipped 0.6% to 15.27 cents. Total revenue per available seat mile declined 2.2% to 14.73 cents. Traffic was down 1.6%, whereas capacity was up 1.2%. This resulted in relatively empty planes. Consolidated load factor (percentage of seats filled by passengers) declined as traffic contracted while capacity expanded. Load factor deteriorated to 83.3% from the comparable year-ago figure of 85.6%.
Total operating expenses at American Airlines rose 5.2% to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company and an $86 million accrual pertaining to the carrier’s profit sharing program contributed to the increase in expenses.
During the quarter, the company returned $669 million billion to its shareholders through dividends of $53 million and share buyback worth $616. Furthermore, the carrier declared a dividend of 10 cents per share. The dividend will be paid on Nov 21, to shareholders on record as of Nov 7, 2016. The carrier has returned more than $9 billion to stockholders through share repurchases and dividends since mid-2014. We are impressed by the company’s shareholder-friendly initiatives.
American Airlines remains focused on introducing new aircraft and retiring old ones from its fleet. In keeping with its aim to modernize its fleet, the carrier took delivery of 12 new mainline aircraft and nine regional ones during the reported quarter. It also retired 49 aircraft in the same quarter. The carrier invested $1 billion toward new aircraft during the quarter.
For 2016, the Zacks Consensus Estimate for Copa Holdings has climbed 12 cents to $4.57 per share over the last month.
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American Airlines (AAL) Beats on Q3 Earnings & Revenues
American Airlines Group Inc.(AAL - Free Report) reported better-than-expected earnings in the third quarter of 2016. The company posted adjusted earnings per share of $2.80 that comfortably beat the Zacks Consensus Estimate of $1.68. Quarterly earnings increased more than 1% year over year.
Revenues of $10,594 million were 1.1% below the year-ago figure but edged past the Zacks Consensus Estimate of $10,549 million. We note that not only American Airlines but some of its fellow carriers like United Continental Holdings (UAL - Free Report) and Alaska Air Group (ALK - Free Report) have also reported better-than-expected earnings and revenues in the third quarter.
Consolidated passenger revenue per available seat mile (PRASM) declined 3.3% to 12.72 cents in the reported quarter. Consolidated yield dipped 0.6% to 15.27 cents. Total revenue per available seat mile declined 2.2% to 14.73 cents. Traffic was down 1.6%, whereas capacity was up 1.2%. This resulted in relatively empty planes. Consolidated load factor (percentage of seats filled by passengers) declined as traffic contracted while capacity expanded. Load factor deteriorated to 83.3% from the comparable year-ago figure of 85.6%.
Total operating expenses at American Airlines rose 5.2% to $9.2 billion, mainly because of the 15.3% increase in salaries and benefits expenses. The recent labor deals inked by the company and an $86 million accrual pertaining to the carrier’s profit sharing program contributed to the increase in expenses.
During the quarter, the company returned $669 million billion to its shareholders through dividends of $53 million and share buyback worth $616. Furthermore, the carrier declared a dividend of 10 cents per share. The dividend will be paid on Nov 21, to shareholders on record as of Nov 7, 2016. The carrier has returned more than $9 billion to stockholders through share repurchases and dividends since mid-2014. We are impressed by the company’s shareholder-friendly initiatives.
American Airlines remains focused on introducing new aircraft and retiring old ones from its fleet. In keeping with its aim to modernize its fleet, the carrier took delivery of 12 new mainline aircraft and nine regional ones during the reported quarter. It also retired 49 aircraft in the same quarter. The carrier invested $1 billion toward new aircraft during the quarter.
AMER AIRLINES Price, Consensus and EPS Surprise
AMER AIRLINES Price, Consensus and EPS Surprise | AMER AIRLINES Quote
Zacks Rank & a Key Pick
Currently, American Airlines Group has a Zacks Rank #3 (Hold). A better-ranked stock in the transportation space is Copa Holdings (CPA - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
For 2016, the Zacks Consensus Estimate for Copa Holdings has climbed 12 cents to $4.57 per share over the last month.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>