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LATAM Airlines Resurgent on Upgrades and Rise in Travel Demand
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LATAM Airlines Group S.A. (LTM - Free Report) has witnessed a major resurgence in recent months. LATAM's strong financial performance and strategic enhancements, as well as developments in the Latin American region, position it as a compelling prospect.
In first-quarter 2025, the airline reported revenues of $3.41 billion, marking a 2.7% year-over-year rise, driven by a 1.6% uptick in passenger revenues and a notable 9.8% jump in cargo revenues. The top line beat the Zacks Consensus Estimate of $3.38 billion. The company reported earnings of $1.18 for the period, which widely surpassed the Zacks Consensus Estimate of 61 cents.
During this period, LATAM transported 21 million passengers, marking a 3.6% increase from the previous year. The company has positioned itself to make the most of the projected growth in Latin America's air travel sector. The airline plans to nearly triple the number of flights per inhabitant and expand its international routes, rejuvenating its fleet with both Boeing and Airbus aircraft.
A sustained uptick in travel demand has enabled LATAM to expand and revise its available seat kilometer (ASK) growth forecast for 2025 to between 7.5% and 9.5% from the previous estimate of 7% to 9%. In April, LATAM transported more than 6.7 million passengers, marking a 7.6% increase from the same month in the previous year.
Infrastructure developments in the Latin American region have also contributed to the airlines’ recent boost. For instance, Brazil is investing heavily in its main airport, São Paulo-Guarulhos International Airport, while Mexico has inaugurated new airports in Mexico City and Tulum. These enhancements improve connectivity and operational efficiency, supporting airline growth. Also, the World Travel & Tourism Council projects that Latin America's travel and tourism sector could add nearly $260 billion to the region's economy over the next decade. Enhanced tourism means LATAM benefits from increased passenger volumes and expanded route networks.
LTM currently carries a Zacks Rank #1 (Strong Buy) and a VGM Score of A. Over the past six months, LTM has grown 36.8% against a 9.6% decline for its Zacks Peer Group. Ryanair Holdings plc (RYAAY - Free Report) and Japan Airlines Co., Ltd. (JAPSY - Free Report) are notable competitors in the same space. Both Ryanair and Japan Airlines currently sport a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here
Image Source: Zacks Investment Research
Strategically, LATAM continues to enhance its customer experience by upgrading its fleet and services. It has widely expanded its Wi-Fi capability and modernized interiors. The introduction of premium economy cabins across all narrow-body aircraft and new business class cabins with privacy features have contributed to achieving a Net Promoter Score (NPS) of 56, the highest in the company's history.
The airline has been included in the S&P Global Sustainability Yearbook. This recognizes its outstanding environmental, social and governance (ESG) practices and bolsters its commitment to sustainable growth.
Bottom Line
LATAM Airlines' strong performance is the result of strategic network expansion, fleet modernization, enhanced customer service, operational efficiency and a commitment to sustainability. These efforts have positioned the airline as a leader in the Latin American aviation market. The company, thus, presents a promising opportunity for investors seeking exposure to the recovering airline industry.
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LATAM Airlines Resurgent on Upgrades and Rise in Travel Demand
LATAM Airlines Group S.A. (LTM - Free Report) has witnessed a major resurgence in recent months. LATAM's strong financial performance and strategic enhancements, as well as developments in the Latin American region, position it as a compelling prospect.
In first-quarter 2025, the airline reported revenues of $3.41 billion, marking a 2.7% year-over-year rise, driven by a 1.6% uptick in passenger revenues and a notable 9.8% jump in cargo revenues. The top line beat the Zacks Consensus Estimate of $3.38 billion. The company reported earnings of $1.18 for the period, which widely surpassed the Zacks Consensus Estimate of 61 cents.
During this period, LATAM transported 21 million passengers, marking a 3.6% increase from the previous year. The company has positioned itself to make the most of the projected growth in Latin America's air travel sector. The airline plans to nearly triple the number of flights per inhabitant and expand its international routes, rejuvenating its fleet with both Boeing and Airbus aircraft.
A sustained uptick in travel demand has enabled LATAM to expand and revise its available seat kilometer (ASK) growth forecast for 2025 to between 7.5% and 9.5% from the previous estimate of 7% to 9%. In April, LATAM transported more than 6.7 million passengers, marking a 7.6% increase from the same month in the previous year.
Infrastructure developments in the Latin American region have also contributed to the airlines’ recent boost. For instance, Brazil is investing heavily in its main airport, São Paulo-Guarulhos International Airport, while Mexico has inaugurated new airports in Mexico City and Tulum. These enhancements improve connectivity and operational efficiency, supporting airline growth. Also, the World Travel & Tourism Council projects that Latin America's travel and tourism sector could add nearly $260 billion to the region's economy over the next decade. Enhanced tourism means LATAM benefits from increased passenger volumes and expanded route networks.
LTM currently carries a Zacks Rank #1 (Strong Buy) and a VGM Score of A. Over the past six months, LTM has grown 36.8% against a 9.6% decline for its Zacks Peer Group. Ryanair Holdings plc (RYAAY - Free Report) and Japan Airlines Co., Ltd. (JAPSY - Free Report) are notable competitors in the same space. Both Ryanair and Japan Airlines currently sport a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here
Image Source: Zacks Investment Research
Strategically, LATAM continues to enhance its customer experience by upgrading its fleet and services. It has widely expanded its Wi-Fi capability and modernized interiors. The introduction of premium economy cabins across all narrow-body aircraft and new business class cabins with privacy features have contributed to achieving a Net Promoter Score (NPS) of 56, the highest in the company's history.
The airline has been included in the S&P Global Sustainability Yearbook. This recognizes its outstanding environmental, social and governance (ESG) practices and bolsters its commitment to sustainable growth.
Bottom Line
LATAM Airlines' strong performance is the result of strategic network expansion, fleet modernization, enhanced customer service, operational efficiency and a commitment to sustainability. These efforts have positioned the airline as a leader in the Latin American aviation market. The company, thus, presents a promising opportunity for investors seeking exposure to the recovering airline industry.