Analysis: Airline sector to see merger synergies play out

|By:, SA News Editor

Interesting analysis from Stifel Nicolaus makes the argument that the rally in airline stocks is just getting started.

Despite all the talk about carrier consolidation being played out, only one large merger (Delta-Northwest) has been implemented to the hilt, notes the investment firm.

The Southwest-AirTran, United-Continental, and U.S. Airways-American combinations still have various amounts of synergies to be realized.

Stifel's sector buy recommendations: Delta Air Lines (DAL), United Continental (UAL), Alaska Air (ALK), Spirit Airlines (SAVE), and Allegiant Travel (ALGT).