Thu, Apr. 14, 9:52 AM
- Airline stocks are higher in early trading after Delta Air Lines reported earnings.
- Leading the charge are Spirit Airlines (SAVE +3.8%), American Airlines Group (AAL +3.9%), United Continental (UAL +2.6%), Southwest Airlines (LUV +1.5%), and JetBlue (JBLU +3.2%).
- The rush into the airline names appears to be tied to Delta's stance on capacity growth just as much as the nifty profit beat off of fuel cost savings.
- The below statement from Delta is music to the ears of airline investors.
- "We are focused on getting unit revenues back to a positive trajectory and we will make adjustments to our fall capacity levels if we are not making sufficient progress over the coming months," said Delta exec Glen Hauenstein.
- Now read 4 Top Ranked Airlines Ready To Take Off
Tue, Apr. 12, 8:17 AM
- United Continental (NYSE:UAL) is expected to agree to add an independent chairman and new directors to its board, according to CNBC.
- Sources indicate a formal announcement of a deal with key hedge fund investors PAR Capital Management and Altimeter Capital Management could arrive next week,
- Airline industry insiders have pointed at United Airlines as the major U.S. carrier most needing of a board and C-suite shakeup.
- UAL is down 12% over the last year vs. the 3% gain for the U.S. Global Jets ETF (NYSEARCA:JETS).
- Now read New Competition Poses Challenges For United Continental
Wed, Apr. 6, 3:36 PM| Wed, Apr. 6, 3:36 PM | 4 Comments
Tue, Apr. 5, 12:42 PM
- United Continental (UAL -0.7%) offers ground workers a 30% raise over five years along with other perks.
- Employees with the International Association of Machinists & Aerospace Workers are expected to vote on the new agreement on April 15.
- United signed separate deals with pilots and flight dispatchers in recent months.
- Now read United: A Chinese Opportunity
Fri, Apr. 1, 5:53 PM
- American Airlines (NASDAQ:AAL), Delta Air Lines (NYSE:DAL), United Continental (NYSE:UAL) and Hawaiian Holdings (NASDAQ:HA) were downgraded to Hold from Buy today at Deutsche Bank, citing key macro indicators that it believes signal a more challenging environment for 2016.
- Deutsche Bank says a slowdown in U.S. corporate profits is a concern given that they are a leading indicator of economic activity, and thus could lead to reduced demand for corporate travel; however, consumer spending and housing have fared better, which should bolster demand for discretionary and leisure travel at least through the summer.
- The firm favors domestic names that are less reliant on corporate travel, such as Southwest Airlines (NYSE:LUV), Alaska Air (NYSE:ALK), JetBlue (NASDAQ:JBLU), Spirit Airlines (NASDAQ:SAVE) and SkyWest (NASDAQ:SKYW).
- Now read U.S. airlines under scrutiny for baggage fees
Thu, Mar. 24, 9:45 AM
Wed, Mar. 23, 4:32 AM
- The two activist investors that have launched a boardroom fight with United Continental (NYSE:UAL) are calling on the airline to immediately appoint one of its two new board members as chairman.
- The funds, PAR Capital Management and Altimeter Capital Management, asked that either James Whitehurst, former COO of Delta Air Lines, or Robert Milton, former CEO of Air Canada, be named chairman before shareholders vote on a slate of six other directors.
Tue, Mar. 22, 8:30 AM
- Travel-related stocks are down sharply following the terror attacks in Belgium at a metro station and the international airport.
- The latest report indicates 26 people were killed and 130 were injured from the explosions.
- Notable movers in premarket trading include Priceline (NASDAQ:PCLN) -2.26%, Expedia (NASDAQ:EXPE) -3.1%, Delta Air Lines (NYSE:DAL) -2.5%, Carnival (NYSE:CCL) -2.4%, United Continental (NYSE:UAL) -3.6%, Norwegian Cruise Line Holdings (NASDAQ:NCLH) -2.0%, Royal Caribbean (NYSE:RCL) -2.4%, Tripadvisor (NASDAQ:TRIP) -1.6%.
- Previously: Brussels Airport, metro stations rocked by explosions (March 22)
- Previously: Futures lower after terrorist attacks in Brussels (March 22)
Mon, Mar. 21, 5:55 PM
- More airlines are backing off spending billions of dollars to hedge against rising fuel costs after getting burned by low oil prices, WSJ reports, as the speed of the oil price plunge caught the airline industry by surprise and turned some hedges into big money losers.
- Delta Air Lines (NYSE:DAL) and United Continental (NYSE:UAL) say they have no hedges in place for next year after racking up respective $2.3B and $960M in hedging losses last year; on the other hand, American Airlines (NASDAQ:AAL) abandoned hedging in 2014 and enjoyed cheaper fuel costs than many of its rivals.
- Smaller U.S. carriers including JetBlue (NASDAQ:JBLU) and Spirit Airlines (NASDAQ:SAVE) have been minimizing their hedges, and even some European carriers that were big advocates of hedging are scaling back.
- Southwest Airlines (NYSE:LUV) says there's still a place for hedging even after estimating in January that its 2016 hedge book - for 20% of its consumption - was $1B underwater, meaning it will pay $0.50-$0.60/gallon more for jet fuel than some rivals; LUV estimates hedging chopped $2B off its fuel bill during 2001-15.
Mon, Mar. 21, 11:09 AM
- The weakness in oil prices has prompted many airlines to reconsider their hedging policies with the potential benefits seen as no longer outweighing the risk of missing out on added profit from low-priced jet fuel.
- Delta Air Lines (DAL +0.3%) and United Continental (UAL +1.3%) have no hedges in place next year, according to The Wall Street Journal. A lower percentage of fuel expenses are hedged at JetBlue (JBLU +0.9%) and Spirit Airlines (SAVE +0.2%).
- American Airlines Group (AAL +0.5%) and WestJet (OTC:WJAFF, OTC:WJAVF) gave up hedging completely in a very strategic move. "Hedging is a rigged game that enriches Wall Street," explains American' Scott Kirby.
- Related ETF: JETS.
Mon, Mar. 14, 2:57 AM
- The two hedge funds that launched a boardroom fight with United Continental (NYSE:UAL) last week oppose the airline's plans to give CEO Oscar Munoz the additional role of chairman and have concerns about his compensation.
- They are expected to lay out more specific claims about the company in coming weeks that address what they believe are the causes of the No. 3 U.S. airline's low customer satisfaction scores and its sagging stock price, down almost 14% in the past 12 months.
- Munoz returns to the company today following a heart transplant in early January that kept him mostly on the sidelines.
Fri, Mar. 11, 2:41 PM
- United Airlines (NYSE:UAL) is the first airline to use a sustainable biofuel for a commercial flight with a flight today out of Los Angeles International Airport.
- "Today's historic launch of regularly scheduled service utilizing advanced biofuels represents a major next step in our ongoing commitment to operate sustainably and responsibly," said United's top environmental exec.
- United plans to use sustainable biofuel purchased from AltAir Paramount for other flights out of LAX over the next few years.
Thu, Mar. 10, 1:47 PM
- United Continental (UAL -0.6%) has the backing of two key unions its proxy fight with a pair of activist investors.
- The International Association of Machinists and Air Line Pilots Association both sided with the company in public statements. The union groups have board representation at UAL.
- Previously: Board fight brewing at United Continental (March 8)
- Previously: United Continental responds to board challenge (March 8)
Thu, Mar. 10, 11:30 AM
- U.S. airline stocks aren't reaping the benefits of low fuel costs as concerns over capacity outweigh attractive valuation (the median sector forward P/E ratio is around 9.5). A bulk of the sector is in negative territory for the year.
- Recently-released traffic reports from February indicate fare pressure could increase this year.
- Airline execs have been on the hot seat about the increase in flights, but so far haven't dialed back growth plans for 2016. The closest thing to capitulation comes from JetBlue CEO Robin Hayes. "Clearly if these pricing trends continue, we will look at more of our [marginal] capacity," said Hayes.
- Despite record earnings, the problem for investors is that the sector is overrepresented by "higher turnover" investors focused on the PRASM metric, notes Wolfe Research's Hunter Keay. There's also a new focus on baggage fees and a DOJ probe on collusion in the mix.
- Capacity growth in February (Y/Y): Virgin America +21%, United Continental +7% (U.S.), Allegiant Travel +23%, American Airlines +8% (U.S.), JetBlue +20%, Southwest Airlines +14%, Delta Air Lines +11% (U.S.).
- Related stocks: AAL, LUV, HA, ALK, SAVE, VA, JBLU, UAL, RJET, ALGT, DAL.
- Related ETF: JETS.
Wed, Mar. 9, 1:56 PM
- Democratic Senators Richard Blumenthal (Conn.) and Ed Markey (Mass.) introduced a bill earlier today designed to curb excessive baggage and cancellations fees charged by airlines.
- The proposed legislation aims to limit baggage fees to only cover the costs of the baggage handlers, ticket agents, the baggage processing, or other direct costs tied to checking a bag.
- Airlines collected over $3B last year in baggage fees and ticket cancellation charges to represent almost 25% of all revenue.
- Data from the Bureau of Labor Statistics indicates that Delta Air Lines (NYSE:DAL) collects more in baggage fees than any other U.S. airline.
- Related stocks: AAL, LUV, HA, ALK, SAVE, VA, JBLU, UAL, RJET, ALGT.
- Related ETF: JETS.
- Full text of Fair Fees Act (.pdf)
Wed, Mar. 9, 7:19 AM
- United Continental (NYSE:UAL) announces revenue passenger miles increased by 2.7% to 14.065B in February. Domestic RPMs were up 4.0%, while international RPMs gained 1.5%.
- Capacity rose 6% to 18.259B available seat miles, led by 18% rise in Latin America ASMs. Domestic ASMs increased 7.1% during the quarter.
- February load factor -250 bps to 77.0%.
- YTD load factor -110 bps to 79.0%.
- The company estimates the average price per gallon of fuel will be $1.38 to $1.43 in Q1, inclusive of hedging activity.
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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