SkyWest, Inc. (SKYW - Free Report) reported a 3.9% (6,300) year-over-year decline in block hours (a measure of aircraft utilization) to 155,900 in August.
The regional carrier, which remains focused on streamlining its operations, stated that the fall in the metric was in sync with its fleet transition plans. The company aims to reduce the 50-seat jets in its fleet and add new E175 aircraft.
In August, SkyWest’s dual class aircraft (E175, CRJ 900 and CRJ700) accounted for approximately 54.1% of the carrier’s total block-hour production compared with approximately 53.3% a year ago. In terms of airlines, SkyWest Airlines and Express Jet Airlines represented a respective 79.4% and 20.6% of the carrier’s total block-hour production for the month.
Load factor (percentage of seats filled with passengers) improved 150 basis points (bps) to 82.4% in August. While the number of departures in the month fell 6.7% on a year-over-year basis, passenger count declined 4.3%. Additionally, this St. George, UT-based company reported a 4.8% decrease in block hours for the first eight months of the year.
The traffic report apart, SkyWest was in the news recently when its subsidiary — ExpressJet Airlines — inked a tentative deal with the Air Line Pilots Association (“ALPA”), the largest airline pilot union across the globe. This three-year provisional agreement with ALPA is regarding increased wages, improved working conditions and other benefits for the pilots of ExpressJet Airlines represented by the union (read more: SkyWest Inks 3-Year Tentative Labor Deal: What Lies Ahead?).
Zacks Rank & Other Stocks to Consider
SkyWest sports a Zacks Rank #1 (Strong Buy). Investors interested in the broader Transportation sector may also consider Trinity Industries, Inc. (TRN - Free Report) , Landstar System, Inc. (LSTR - Free Report) and ArcBest Corporation (ARCB - Free Report) . All the three stocks carry the same bullish rank as SkyWest. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Trinity, Landstar System and ArcBest have rallied more than 21%, 32% and 73%, respectively, in a year’s time.
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