雅虎香港財經 Airline Stock Roundup: AAL's Dull Q2 Guidance, ALGT's Disappointing April Traffic
In the past week, American Airlines AAL management trimmed its earnings per share outlook for second-quarter 2024. CEO Robert Isom stated that the softness pertaining to bookings was due to changes in the airline's sales strategy. Vasu Raja, AAL’s chief commercial officer, who was spearheading the new sales and distribution strategy, will step down in June.
Allegiant Travel ALGT reported lackluster traffic numbers for the month of April. United Airlines UAL also featured in the news, courtesy of management’s decision to stick to the second-quarter earnings per share guidance provided with first-quarter 2024 results. Latin American carriers Azul AZUL and Gol Airlines inked a codeshare agreement to boost the Brazilian aviation market.
Recap of the Recent Most Important Stories
1. American Airlines now expects adjusted earnings per share for the second quarter in the $1-$1.15 band (earlier guidance was in the $1.15-$1.45 range). Second-quarter total revenue per available seat miles is now expected to decline in the 5-6% band from the year-ago levels (a dip of 1-3% was expected previously). System capacity (measured in available seat miles) is still estimated to increase in the 7-9% band from second-quarter 2023 actuals.
AAL currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
2. At Allegiant, April’s scheduled traffic (measured in revenue passenger miles) fell 13% from the year-ago month. Capacity (measured in available seat miles) for scheduled service declined 11% from the April 2023 reading. The load factor (percentage of seats filled by passengers) in April 2024 declined to 82.4% from 84.3% a year ago as the traffic decrease was more than the capacity contraction.
Allegiant was also in the news recently when it reported first-quarter 2024 results, which were covered in detail in the previous Airline Stock Roundup.
3. United Airlines still expects second-quarter 2024 earnings per share to be in the $3.75-$4.25 band. The Zacks Consensus Estimate, currently pegged at $4.02 per share, is above the mid-point of the guided range.
On a separate note, the Federal Aviation Administration has allowed UAL to take delivery of new airplanes. UAL was prohibited from doing so earlier in the year after a series of safety-related incidents.
4. Azul inked a codeshare deal with Gol Airlines to connect flight networks across Brazil. Following the agreement, customers will gain access to many new domestic routes apart from getting many more convenient connection opportunities. For example, passengers can travel from Rio de Janeiro to Marabá with a stop in Belém.
Performance
The following table shows the price movement of the major airline players over the past week and during the last six months.
Image Source: Zacks Investment Research
The table above shows that most airline stocks traded in the red over the past week. The NYSE ARCA Airline Index decreased 1.5% to $58.04. Over the course of the past six months, the NYSE ARCA Airline Index has gained 4.7%.
What’s Next in the Airline Space?
With the first-quarter 2024 earnings season over for airlines, the focus will once again shift to news-related updates. Air travel demand is still buoyant, as exemplified by the busy Memorial Day weekend. Airlines for America’s upbeat projection implies that U.S. carriers are likely to be extremely busy during the upcoming summer season. Consequently, updates pertaining to the expansion of networks by various carriers cannot be ruled out in the coming days.
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United Airlines Holdings Inc (UAL) : Free Stock Analysis Report
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
Allegiant Travel Company (ALGT) : Free Stock Analysis Report
AZUL (AZUL) : Free Stock Analysis Report
