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American Airlines CEO On Inclusion In The S&P 500


Shares of American Airlines Group Inc (NASDAQ: AAL) spiked during Tuesday's opening on news that the company will be added to the Standard & Poor's 500 Index. Doug Parker, American Airlines CEO, was on CNBC following the announcement to weigh in on the airliner's addition to the S&P 500.

Earlier Than Expected

"With an airline with over $40 billion of revenue a year – made over $4 billion in profits – the largest airline in the world, we certainly knew it would be in the S&P 500 at some point in time," Parker said.

"But, this is earlier than I think most people expected, and it's really good news. It's good news for our shareholders; good news for American."

Related Link: What's The Best Airline Stock? Barclays Has An Idea

Lower Fuel Price Helping

Parker was asked how lower oil prices are impacting his business. He replied, "We have been very successful, since 2008 actually, not entering into derivatives, not doing any hedging. And the result has been: we have paid much less for fuel than our competitors. We are happy where we are right now. The fall in fuel prices certainly helps."

American Airline Vs. Peers

He continued, "We are seeing more of that benefit than most of our competitors because we are not locked into higher prices, and the fuel price this year versus last year at today's price, in today's foreign currency is about $4.5 billion lower than what we paid last year. So, that certainly helps our earnings, and it's a supply driven fall. So, the demand for air travel remains very strong.

"So, it's certainly helpful to our earnings in 2015," Parker concluded.


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