Sat, Jul. 23, 8:25 AM
- General Electric (NYSE:GE) was yesterday's biggest laggard among Dow stocks, sinking 1.6% after reporting a 2% drop in orders for Q2, with industrial orders - GE’s jet engines, power turbines, oil production equipment, et. al. - plunging 16% amid weakness in oil and gas prices that hurt demand.
- "The texture of this quarter is very similar to the two most recent quarters, with exceptionally weak orders,” says Morgan Stanley's Nigel Coe, who rates GE at Equal Weight with a $32 price target.
- GE's total Q2 revenues rose 15% Y/Y to $33.5B, but organic industrial sales excluding the Alstom acquisition fell 1%; GE needs to meet its own expectations for a substantial upturn in organic trends in H2 in an "extremely challenging" environment, Coe says.
- "Those are capital intensive purchases and if those get pushed out even just a little bit" it could weaken GE's performance, says Edward Jones analyst Jeff Windau.
- Andrew Elofson at Davidson Investment Advisors takes the long view, seeing Q2 as "a speed bump on the path to their transformation” and not really looking at whether GE can hit its 5% organic sales growth target for H2.
- But Standpoint Research’s Ronnie Moas responded to the Q2 results by slapping a Sell rating on GE with a $26 price target, seeing no reason to own the shares that trade at more than 20x 2016 EPS estimates while "dozens" of mid-cap names with room to grow trade at or below 10x earnings - such as YRCW, TGI, AVH, GBX, ARII, CBI, UAL, SPR and ACM.
Thu, Jul. 21, 10:39 AM
- Airline stocks (JETS -2.8%) are broadly lower following Southwest Airlines' (LUV -8.8%) Q2 earnings miss and downbeat guidance for a 3%-4% decline in Q3 RASM from a 0.6% gain in Q2.
- Shares also are hurt by warnings from Deutsche Lufthansa (OTCQX:DLAKF, OTCQX:DLAKY) and EasyJet (OTC:EJTTF, OTCQX:ESYJY) that recent terror attacks and political turmoil in Europe were weighing on their businesses.
- Lufthansa says advance bookings, particularly on longer routes to Europe, "have declined significantly, in particular due to repeated terrorist attacks in Europe and to greater political and economic uncertainty."
- Easyjet also warns on terrorism, and says the U.K.’s Brexit vote would hurt per-seat revenue, and that foreign exchange and fuel cost effects would add ~£25M ($33M) to full-year expenses.
- DAL -3.1%, UAL -2.9%, AAL -2%, RYAAY -2.9%, ALK +0.8%, JBLU -2.3%, SAVE -2.6%, HA -1.3%, SKYW -0.2%.
Wed, Jul. 20, 1:46 PM
- The Department of Transportation gives tentative approval to American Airlines Group (AAL +1.3%), Delta Air Lines (DAL +0.3%), Hawaiian Airlines (HA +0.5%), and United Airlines (UAL +2.3%) for daytime landing slots at Tokyo's Haneda Airport.
- The flights from the U.S. into Haneda during the day could begin as early as this fall.
- Haneda is a hub for Japan Airlines (OTCPK:JAPSY, OTC:JPNRF) and All Nippon Airways (OTCPK:ALNPY).
Wed, Jul. 20, 10:59 AM
- United Continental (UAL +3.6%) tracks higher after management delivered what investors wanted to hear during this morning's post-earnings conference call.
- The company confirmed it will trim capacity in the back half of the year to adjust to demand. The tightened capacity should help improve the closely-watched revenue per available seat mile metric.
- Shares of UAL are threatening to eclipse $50 for the first time since late April.
- UAL conference call webcast
- Previously: United Continental tracks higher after earnings top estimates (July 19)
Tue, Jul. 19, 4:42 PM
- United Continental (UAL +0.3%) reports passenger revenue per available seat mile fell 6.6% in Q2. Demand on the higher yield part of United's business didn't keep up with capacity during the quarter.
- Domestic PRASM declined 4.6%, while both the Atlantic and Latin America saw double-digit PRASM tailoffs.
- United's load factor fell 40 bps to 83.5%.
- United paid on average of $1.44 per gallon in fuel costs in Q1, down 32% Y/Y.
- Total cost per available seat mile was down 0.2% to $0.1239.
- The company says it will add $2B to its current buyback allowance.
- Previously: United Continental beats by $0.04, beats on revenue (July 19)
- UAL +1.15% AH to $48.40.
Tue, Jul. 19, 4:16 PM
Mon, Jul. 18, 5:35 PM
Fri, Jul. 15, 2:27 AM
- Eight months after a murderous rampage in Paris, a deadly attack in the French coastal city of Nice has killed at least 84 people and wounded scores.
- The "terrorist" gunman, described as a French national of Tunisian descent, drove a heavy truck at high speed into a crowd that had been watching Bastille Day fireworks along the Riviera.
- Equities are trading lower, weighed down by travel and tourism stocks, in yet another terror driven selloff.
- CAC 40 -0.6% to 4,358.
- Related tickers: EXPE -2.4%, PCLN -1%, TRIP -1%, NCLH -3%, RCL -2.5%, CCL -0.2%, AAL -1.4%, UAL -1.2%, DAL -1.5%.
Wed, Jul. 13, 10:05 AM
- United Continental's (UAL +0.1%) inaugural nonstop flight from San Francisco to Hangzhou, China today marks the airline's fifth city in mainland China it serves and the 14th Asian-Pacific destination from San Francisco International Airport.
- "The Hangzhou service is a great addition to our growing portfolio of mainland China destinations, including three interior cities that no other airline serves from the United States," said Marcel Fuchs, United's vice president of Atlantic and Pacific sales.
- United will operate the three-times-weekly nonstop flights with the Boeing 787-9 Dreamliner.
- Source: Press Release
Tue, Jul. 12, 6:41 PM
- United Continental (NYSE:UAL) says it will book $434M in charges in Q2, mostly due to the FAA's move to open Newark's airport to more competition.
- UAL is by far Newark’s largest operator and controls nearly 75% of the available slots, which it had used as collateral for a credit agreement with J.P. Morgan, which issues United co-branded credit cards; UAL says the agreements have been changed to remove the slots.
- Shares ripped 8.8% higher in today's trade after raising Q2 unit revenue guidance and enjoying an upgrade to Buy from Hold at Deutsche Bank; shares are unchanged AH.
Tue, Jul. 12, 9:58 AM
- Airline stocks are making strong gains on a flurry of positive news.
- The investment in LATAM Airlines (LFL +23.9%) by Qatar Airways is having a ripple effect across other global carriers. Copa Holdings (CPA +7.9%), Avianca Holdings (AVH +8.1%), and Go Linhas (GOL +7.8%) are all solidly higher.
- In the U.S., a stronger-than-anticipated report from United Continental (UAL +7.7%) on its key Q2 revenue metric is the highlight along with a sweeping upgrade from Deutsche Bank.
- The investment firm raises United, American Airlines Group (AAL +8.6%), and Delta Air Lines (DAL +4.7%) to Buy from Hold.
- "We are of the view that all known negatives (Brexit, tepid global economic growth, over-supplied markets, etc.) are more than fully discounted in the share prices which are, on average, trading at 6.4x our 2016 EPS estimates and 6.8x our 2017 EPS estimates," reads the note from DB.
- Alaska Air Group (ALK +4.3%), JetBlue Airways (JBLU +4%), Southwest Airlines (LUV +3.4%), and Spirit Airlines (SAVE +3.3%) are all higher as well.
- The U.S. Global Jets ETF (NYSEARCA:JETS) is up 3.86% on the day.
Tue, Jul. 12, 8:41 AM
- Shares of United Continental (NYSE:UAL) are higher in premarket trading after the company disclosed a better-than-expected decline in Q2 passenger revenue per available seat mile. Higher ticket prices on global routes kicked in during the quarter to improve the international yield.
- United realized an average fuel cost of $1.44 per gallon in Q2, inclusive of settled hedging activity.
- Shares of United are up 2.81% to $43.60. United slumped to a 52-week low of $37.41 a few weeks ago during the Brexit backlash.
- Previously: United Continental reports on June traffic (July 12)
Tue, Jul. 12, 7:20 AM
- United Continental (NYSE:UAL) reports revenue passenger miles rose 1.4% in June to 19.622B.
- Capacity increased 0.5% to 22.54B available seat miles. Domestic ASMs were down 0.9%, while international capacity increased 2.6% during the month.
- June load factor +80 bps to 87.1%. Domestic load factor +180 bps to 89.2%.
- YTD load factor -80 bps to 81.8%. Domestic load factor -40 bps to 85.2%.
- The company expects Q2 consolidated passenger unit revenue to decline 6.5% to 6.75%.
- Press Release
Thu, Jul. 7, 11:14 AM
- The Department of Transportation issues its recommendations on airline service from the U.S. to Cuba.
- The DOT awards Alaska Airlines (NYSE:ALK), American Airlines (NASDAQ:AAL), Delta Air Lines (NYSE:DAL), privately-held Frontier Airlines, JetBlue (NASDAQ:JBLU), Southwest Airlines (NYSE:LUV), Spirit Airlines (NASDAQ:SAVE), and United Airlines (NYSE:UAL) the right to fly into Havana from Atlanta, Charlotte, Fort Lauderdale, Houston, Los Angeles, Miami, Newark, New York City, Orlando, and Tampa.
- Flights are expected to start this fall, with up to 20 daily frequencies allowed by the current agreement with Cuba.
- DOT press release
Wed, Jul. 6, 1:02 PM
- Airline stocks continue to lose altitude amid concerns on capacity growth and labor expenses. The Bloomberg U.S. Airlines Index has retreated 27% YTD, while the slightly-diversified U.S. Global Jets ETF (NYSEARCA:JETS) is down about 17%.
- Analysts such as Credit Suisse's Julie Yates continue to point the finger directly at management.
- "Capacity growth continues to outpace GDP in all regions and the industry’s willingness to trim growth with oil still in a historically inexpensive range of $50 a barrel is low," notes Yates. Delta's disclosure of a 5% drop in PRASM in Q2 backs up her contention.
- Sector snapshot: A CS downgrade on both United Continental (UAL -3.2%) and American Airlines Group (AAL -4.1%) today sent both stocks spiraling downward, with UAL hitting a 52-week low. Also suffering from the doldroms, Delta Air Lines (DAL -1.7%) is down 29% YTD and JetBlue (JBLU -1.2%) is off 27%. Spirit Airlines (SAVE -2%) and Southwest Airlines (LUV -1.1%) don't have to worry about European demand, but have seen an impact from pricing competition in key markets this year. Virgin America (VA -0.2%) shareholders are the ones that have navigated the choppy market the best this year due to the buyout from Alaska Air Group (ALK -1.3%).
Wed, Jul. 6, 8:53 AM
- American Airlines Group (NASDAQ:AAL) is moved straight to Underperform from Outperform by Credit Suisse on a raised level of concern over European travel and PRASM marks in the U.S. Analyst Julie Yates also points to the "abysmal" cash flow at the company. AAL -4.01% premarket to $27.77.
- United Continental (NYSE:UAL) is lowered to Neutral from Outperform by the firm. The price target on UAL is chopped to $42 from $64 due to a reset on earnings expectations and appropriate valuation. UAL -2.21% premarket to $39.40.
- Related ETF: JETS.
United Continental Holdings, Inc. is a holding company and its principal, wholly-owned subsidiaries are United Airlines, Inc. It transport people and cargo through their mainline operations. The company offers satellite based Wi-Fi, including on long-haul overseas routes. United Continental... More
Industry: Major Airlines
Country: United States
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