We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why Azul (AZUL) Stock Plummets 86% in the Past 90 Days
Read MoreHide Full Article
Shares of Azul (AZUL - Free Report) have tumbled 85.8% compared with the industry’s 62.3% decline in the past three months.
Echoing the plight of most of its peers, Azul has been badly affected by deflated air-travel demand due to the coronavirus outbreak, which dimmed its earnings prospects in the process.
Azul reported wider-than-expected loss for first-quarter 2020, mainly due to the coronavirus-induced drop in demand. With capacity expansion outpacing traffic growth, consolidated load factor (percentage of seats filled with passengers) deteriorated 90 basis points to 81% in the quarter.
Moreover, due to waning travel demand, Azul reported a 90% decline in consolidated traffic (measured in revenue passenger kilometers or RPKs).Consolidated capacity (measured in available seat kilometers/ASKs) dropped 87.7%. Meanwhile, consolidated load factor (% of seats filled by passengers) decreased 15.6 percentage points to 68.8%.Similarly, the first-quarter load factor of Latin American carrier Copa Holdings (CPA - Free Report) , which carries a Zacks Rank #3 (Hold), contracted 190 basis points to 81.5%.
For the April-June period, Azul expects to reduce 75-85% of capacity year over year. In May and June, the company expects a net cash burn rate of R$3-R$4 million per day. The Zacks Consensus Estimate for the stock’s current-year loss is pegged at 30 cents per share. While the same consensus mark was of earnings of $2.3 per share 60 days ago. This estimate revision in the opposite direction is indicative of the pessimism surrounding the Zacks Rank #4 (Sell) stock.
Due to the ongoing unprecedented crisis triggered by the coronavirus pandemic, a high proportion of employees at Azul as well as at its Zacks Rank #3 Latin American rival Gol Linhas is on forced unpaid leave. Moreover, per a Reuters report, another Zacks #3 Ranked South-American carrier, LATAM Airlines Group (LTM - Free Report) , will lay off its workforce by 1400 due to prevalent situation.
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
Image: Bigstock
Here's Why Azul (AZUL) Stock Plummets 86% in the Past 90 Days
Shares of Azul (AZUL - Free Report) have tumbled 85.8% compared with the industry’s 62.3% decline in the past three months.
Echoing the plight of most of its peers, Azul has been badly affected by deflated air-travel demand due to the coronavirus outbreak, which dimmed its earnings prospects in the process.
Azul reported wider-than-expected loss for first-quarter 2020, mainly due to the coronavirus-induced drop in demand. With capacity expansion outpacing traffic growth, consolidated load factor (percentage of seats filled with passengers) deteriorated 90 basis points to 81% in the quarter.
Moreover, due to waning travel demand, Azul reported a 90% decline in consolidated traffic (measured in revenue passenger kilometers or RPKs).Consolidated capacity (measured in available seat kilometers/ASKs) dropped 87.7%. Meanwhile, consolidated load factor (% of seats filled by passengers) decreased 15.6 percentage points to 68.8%.Similarly, the first-quarter load factor of Latin American carrier Copa Holdings (CPA - Free Report) , which carries a Zacks Rank #3 (Hold), contracted 190 basis points to 81.5%.
For the April-June period, Azul expects to reduce 75-85% of capacity year over year. In May and June, the company expects a net cash burn rate of R$3-R$4 million per day. The Zacks Consensus Estimate for the stock’s current-year loss is pegged at 30 cents per share. While the same consensus mark was of earnings of $2.3 per share 60 days ago. This estimate revision in the opposite direction is indicative of the pessimism surrounding the Zacks Rank #4 (Sell) stock.
Due to the ongoing unprecedented crisis triggered by the coronavirus pandemic, a high proportion of employees at Azul as well as at its Zacks Rank #3 Latin American rival Gol Linhas is on forced unpaid leave. Moreover, per a Reuters report, another Zacks #3 Ranked South-American carrier, LATAM Airlines Group (LTM - Free Report) , will lay off its workforce by 1400 due to prevalent situation.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
See their latest picks free >>