For Immediate Release
Chicago, IL – May 26, 2016 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Southwest Airlines LUV, Alaska Air Group ALK, Ryanair Holdings plc ( RYAAY), Delta Air Lines DAL and American Airlines Group AAL.
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Here are highlights from Wednesday's Analyst Blog:
Airline Stock Roundup
The past week saw the Dallas-based carrier Southwest Airlines LUV announce two shareholder friendly moves – a dividend hike and a new share repurchase program. However, the recent crash of the EgyptAir jet into the Mediterranean Sea, claiming 66 lives, has been dominating headlines.
Furthermore, the employment data released by Bureau of Transportation Statistics for passenger airlines showed a substantial year-over-year increase in full-time equivalent FTE employment for March. Moreover, expansion related news from Alaska Air Group ( ALK) grabbed headlines in the past week.
On the earnings front, European low-cost carrier Ryanair Holdings plc RYAAY reported healthy results in fiscal 2016 (ended Mar 31, 2016), on the back of increased revenues and low costs.
(Read the last Airline Stock Roundup for May 18, 2016 ).
Recap of the Past Week's Most Important Stories
1. Close on the heels of Delta Air Lines' DAL decision to hike its quarterly dividend payout, Southwest Airlines announced a dividend raise along with a new share repurchase program worth $2 billion. The low-cost carrier raised its cash quarterly dividend to $0.10 per share ($0.40 per share annualized), representing an increase of 33.33% over the previous quarterly payout (read more: Southwest Airlines Up on Dividend Hike & New Buyback Plan ).
2. Investigations are underway to determine the cause of the crash of the EgyptAir jet which was travelling from Paris to Cairo. According to a Bloomberg report, Egypt's aviation minister Sherif Fathy had cited terrorism as a probable cause behind the tragedy. Although it has not yet been proved conclusively that the flight was a victim to a terror act, we believe that in the event of it being proved so, travel to Europe will take a hit (read more: US Carriers Sell Off in Wake of EgyptAir Tragedy ).
3. Alaska Airlines, the wholly owned subsidiary of Alaska Air Group, announced the addition of a three-times-a-day nonstop service connecting San Diego to Sacramento and Burbank to San Jose. The new service is set to commence on Mar 16, 2017 (read more: Alaska Airlines Eyes Route Expansion, California in Focus ).
4. According to data released by the Bureau of Transportation Statistics, there was a 3.9% increase in the number of workers employed by U.S. scheduled passenger airlines for March. This marked the 28th consecutive month of year-over-year increase. FTEs for Mar 2016 came in at 406,113. According to the update, the most number of FTEs in the month were employed by the American Airlines Group AAL among the network airlines. Southwest Airlines secured the top spot in this regard in the low-cost carrier category.
5. Ryanair Holdings reported robust financial and operating numbers with net profit for fiscal 2016 up 43% year over year at €1,242 million. Moreover, load factor increased 500 basis points to 93%. The top line expanded 16% to €6,536 million on the back of an 18% rise in passenger count to 106.4 million. The customer friendly "Always Getting Better (AGB)" program drew massive number of new customers to Ryanair.
However, the carrier issued a "cautious" outlook for fiscal 2017 in the wake of the recent terror attacks. The carrier expects airfares to face pressure due to concerns which could hurt travel demand in Europe. That the carrier's fears are not baseless is reflected by the update coming from travel company, Thomas Cook. The agency has revealed a 5% decline in summer bookings compared to last year. With average fares expected to decline approximately 7%, net profit for fiscal 2017 is expected to increase only 13%. The company plans to fly 116 million passengers in fiscal 2017, reflecting an increase of 9%.
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SOUTHWEST AIR LUV: Free Stock Analysis Report
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AMER AIRLINES AAL: Free Stock Analysis Report
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