Tue, Mar. 24, 7:15 PM
- Oil prices have dropped by more than 50% in the past year but consumers have not enjoyed a corresponding drop even though oil prices are an airline's largest expense.
- NYT's Andrew Ross Sorkin says the airline industry is increasingly looking like an uncompetitive oligopoly, as mergers during the last several years have left the U.S. with only four main airlines - Delta (NYSE:DAL), United (NYSE:UAL), Southwest (NYSE:LUV) and American-US Airways (NASDAQ:AAL) - which deliberately do not compete on some routes.
- "In a truly competitive marketplace, airlines would add capacity to popular routes where they saw the opportunity to undercut a competitor. And given low oil prices, you would imagine that at least one airline would lower its rates to pick up market share and make it up in volume," Sorkin writes.
- The International Air Transport Association says the U.S. air travel industry is set to rack up "net post-tax profits" of $13.2B in 2015, up from $11.9B in 2014, a forecast that was based on an average cost of $85/bbl for Brent crude oil - whose price today is ~$55/bbl.
Tue, Mar. 24, 9:48 AM
- Airline fares in the U.S. rose in February, according to the Bureau of Labor Statistics.
- The average fare was up 1.9% from January.
- Fares were 3% lower than they were a year ago during February.
- Though a slight increase was expected with oil prices higher, the reading is still positive for the sector as the impact of capacity gains in key markets on fares is weighed.
- Related stocks: LUV, UAL, DAL, AAL, JBLU, ALK, HA, SAVE, ALGT, RJET, VA, SKYW.
- BLS CPI data
Mon, Mar. 23, 3:24 PM
- The Barron's 400 has regularly beaten the S&P 500 (NYSEARCA:SPY) since its 2007 launch, writes Chris Dieterich, and also powers the Barron's 400 ETF (NYSEARCA:BFOR), which has topped the S&P 500 by nearly 500 basis points since starting in June 2013. BFOR is up 6% YTD, more than double that of the S&P 500.
- Among those added to the index during last week's twice-yearly rebalancing were Celgene (NASDAQ:CELG), American Airlines (NASDAQ:AAL), Starbucks (NASDAQ:SBUX), and Ameriprise Financial (NYSE:AMP).
- Among those dropped were McDonald's (NYSE:MCD), Wells Fargo (NYSE:WFC), Verizon (NYSE:VZ), and IBM.
- A "ruthless" quantitative security-selection method screens for growth, value, and cash flow, and filters further with other factors such as diversification.
Sat, Mar. 21, 11:46 AM
- Positive commentary from the analyst community and some help from the oil patch helped the airline sector outperform for the week.
- American Airlines Group (NASDAQ:AAL) ran up a gain of 11% off of news the company would be added to the S&P 500 Index.
- Plenty of bets were laid out on American with volume on Friday at 137.8M shares vs. 15.33M daily average.
- Analysts thinks the inclusion of American to the S&P 500 to join Southwest Airlines (NYSE:LUV) and Delta Air Lines (NYSE:DAL) effectively boxes out United Continental (NYSE:UAL) and Alaska Airlines (NYSE:ALK) from the prized index until at least 2016.
- A positive read from Southwest on efficiency also helped to buoy sentiment.
- Even beaten-down Hawaiian Holdings (NASDAQ:HA) perked up during the week with a 8.56% run. The carrier has under-performed recently due in part to some hedging losses.
- ETF fans are set to have their catch-all airline investment opportunity soon with the expected launch of the U.S. Global Jets ETF (Pending:JETS) next month.
Thu, Mar. 19, 2:37 PM
- Investor may get a buying opportunity with airline stocks when major carriers start reporting in a few weeks, tips Credit Suisse.
- Shares in the group could trade lower after Q1 numbers come up short amid F/X pressure and Q2 guides for efficiency (PRASM) are influenced by capacity growth.
- CS is a buyer on weakness with the sector looking strong for the back half of the year.
- On watch: Southwest Airlines (NYSE:LUV), JetBlue (NASDAQ:JBLU), Delta Air Lines (NYSE:DAL), United Continental (NYSE:UAL), American Airlines Group (NASDAQ:AAL).
- Previously: Global airline ETF expected this spring (March 18)
Wed, Mar. 18, 7:27 PM
- U.S. Global Investors is expected to launch an airline ETF this spring.
- The U.S. Global Jets ETF (Pending:JETS) comprised of worldwide airline companies could launch as early as next month.
- The ETF news comes during a period of high volatility in the sector as airline stocks react to developments in the oil market and macroeconomic factors.
- The sector has also done well for investors over the last year. Southwest Airlines topped all stocks in the S&P 500 Index in 2014, while American Airlines Group has doubled since the American bankrutpcy and US Airways integration.
- Airline stocks: AAL, UAL, DAL, RYAAY, OTCPK:CPCAY, OTCPK:SINGY, CEA, ZNH, CPA, GOL, LFL, OTCPK:DLAKF, OTCPK:QUBSF, ALK, HA, OTCPK:AIRYY, OTCPK:MLYAF, OTCPK:AFLYY, VLRS, LUV, OTC:RYAOF, RJET, VA, LFL, SAVE, ALGT, CEA, OTC:EJTTF, OTCQX:ESYJY, AVH, OTC:AFRAF, OTCPK:ICAGY.
Tue, Mar. 17, 1:38 PM
- Ryanair (RYAAY, OTC:RYAOF) is taking the first steps to adding transatlantic routes with the board's approval for 14 destinations in the U.S. and Europe.
- The airline's entry into the Europe-to-U.S. market would be significant due to the difficulty in the past of budget carriers to make the numbers work on the longer routes.
- An entry by Ryanair into the U.S. isn't expected for four to five years with the company needing to work out landing slots at key airports and acquire larger planes from manufacturers.
- A spokesperson for Ryanair was quoted as saying fares on the transatlantic flights could start at the ridiculous fare of £10 ($10.59).
- Airlines flying across the pond include Virgin Atlantic, Lufthansa (OTCQX:DLAKY, OTCPK:DLAKF), Air France (OTC:AFRAF, OTCPK:AFLYY), American Airlines Group (NASDAQ:AAL), Delta Air Lines (NYSE:DAL), and British Airways (OTCPK:ICAGY).
Tue, Mar. 17, 8:22 AM
- The airline sector is lined up for a big day with oil prices pointing lower again in early trading.
- American Airlines Group (NASDAQ:AAL) is out in front of peers with an early 5% pop.
- The company continues to get the most bang out of the oil buck in the sector from lower jet fuel prices due to its no-hedge strategy, although capex concerns have kept some investors from jumping in.
- AAL +5.34% to $52.88.
Mon, Mar. 16, 5:21 PM
Wed, Mar. 11, 2:12 PM
- Airline stocks are taking back some ground with oil prices peeling off 1.3%.
- The sector also got a lift when Southwest Airlines topped analyst estimates for revenue passenger miles for February.
- Gainers: United Continental (NYSE:UAL) +2.4%, Southwest Airlines (NYSE:LUV) +1.9%, Virgin America (NASDAQ:VA) +1.6%, Spirit Airlines (NASDAQ:SAVE) +1.5%, American Airlines Group (NASDAQ:AAL) +1.5%, Delta Air Lines (NYSE:DAL) +1.2%.
- Related: Spring preview on U.S. airlines
- Previously: Load factor on the rise at Southwest Airlines
Wed, Mar. 11, 7:41 AM
- U.S. airlines expect passenger traffic to increase 2% during March and April.
- The group of major carriers is forecast to show a 3% rise in capacity over the period.
- The industry's net profit margin is expected to improve compared to a year ago due to lower fuel expenses.
- The average price on aviation jet fuel in North America is currently down 36.6% from a year ago, but 25.2% higher than the level from a month ago.
- Airline fares fell 3% in January and are expected to have shown a smaller decline in February. March fares are seen as holding steady due to strong business demand.
- U.S. carriers: LUV, UAL, DAL, AAL, JBLU, ALK, HA, SAVE, ALGT, RJET, VA.
Tue, Mar. 10, 8:14 AM
- American Airlines Group (NASDAQ:AAL) reports total revenue passenger miles fell 0.7% to 15.0B in February.
- Revenue passenger miles for Atlantic flights were down 11.7% amid a month of heavy winter storms and the load factor in the region was off 120 bps.
- The combined load factor for the company's brands improved 90 bps to 79.3% on tightened capacity.
- American sets Q1 passenger revenue per available seat mile guidance of -2% to -4% Y/Y. A pretax margin rate of 12% to 14% is expected for the quarter.
- AAL -0.56% premarket.
Fri, Mar. 6, 10:10 PM
- U.S. air carriers Delta (NYSE:DAL), American (NASDAQ:AAL) and United (NYSE:UAL) are pressing the government to modify "open skies" treaties covering three Middle East-based competitors -- some saying they'd fly direct routes to the East if not for unfair subsidies.
- "We're not really competing against airlines, we're competing against governments," Delta's Trevor Banstetter tells Puget Sound Business Journal, suggesting the airlines have become more of an economic development tool for countries like the United Arab Emirates and Qatar.
- The three have spent two years producing a 55-page report they say shows $42B in subsidies and benefits since 2004 given to Emirates airline, Etihad Airways and Qatar Airways. The U.S. three want agreements modified to curtail further expansion to the U.S. -- or, failing that, for the treaties to be revoked.
- The U.S. has made "open skies" agreements, allowing unfettered routes, with 114 countries since 1992. For its part, the government says it's taking the claim seriously but hasn't decided on any consultations with Eastern governments.
- The three Middle East airlines have denied the unfair subsidies claims but say they'll provide a detailed response after reviewing the report.
Thu, Mar. 5, 7:39 PM
- A major winter storm which is sweeping across a wide part of the eastern and southern part of the U.S. impacted air travel.
- The number of flight cancellations today totaled over 5,300 with SkyWest (NASDAQ:SKYW), Southwest Airlines (NYSE:LUV), Delta Air Lines (NYSE:DAL), American Airlines Group (NASDAQ:AAL) and Republic Airlines (NASDAQ:RJET) all hit hard.
- Weather has also played a factor in the retail sector. Several mall-based chains blamed Mother Nature for the year-over-year drop in traffic during February.
- Previously: U.S. retailers warn on cold snap impact
Wed, Mar. 4, 9:11 AM
- IATA reports global airliners showed passenger growth of 4.6% in January.
- International flights were up 5.4% on a revenue passenger kilometer basis, while domestic routes increased 3.2%.
- Jan. passenger demand by carrier region: Europe +5.0%, Asia-Pacific +4.7%, North America +2.7%, Middle East +11.4%, Latin America +5.6%, Africa -0.7%.
- The timing of the Chinese New Year (February this year) was a factor, notes IATA. Overseas trips by domestic passengers rose an estimated 10% Y/Y during the Chinese New Year holiday.
- Global airline stocks: AAL, UAL, DAL, RYAAY, OTCPK:CPCAY, OTCPK:SINGY, CEA, ZNH, CPA, GOL, LFL, OTCPK:DLAKF, AIDIF, OTCPK:QUBSF, ALK, HA, OTCPK:AIRYY, OTCPK:MLYAF, OTCPK:AFLYY, VLRS, LUV.
Thu, Feb. 26, 9:15 AM
- Airline fares fell 3.0% Y/Y in the U.S. during January on an unadjusted basis, according to data from the Bureau of Labor Statistics.
- The average fare was down 1.4% M/M.
- The drop in fares over the last few months lags by a wide margin the fuel expense savings reported by carriers.
- Related stocks: LUV, UAL, DAL, AAL, JBLU, ALK, HA, SAVE, ALGT, RJET, VA, SKYW,
AAL vs. ETF Alternatives
American Airlines Group Inc, through its subsidiaries, operates in the airline industry. The Company has hubs in Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York City, Philadelphia, Phoenix and Washington, D.C.
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