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Airline Stock Roundup: AAL, HA Post Q4 Loss, SAVE, GOL in Focus

Maharathi Basu
·4-min read

In the past week,American Airlines AAL and Hawaiian Holdings HA reported losses for fourth-quarter 2021. The same, however, narrowed year over year as the December-quarter results were better than the fourth-quarter 2020 earnings reports, despite the omicron-induced crisis.

On the non-earnings front, Gol Linhas Aereas Inteligentes GOL grabbed headlines for its deal with Castlelake to secure financing up to $600 million for buying 12 new Boeing 737 Max 8 jets. An expansion-related update from Spirit Airlines SAVE was also available over the past week.

Read the last Airline stock Roundup here.

Recap of the Latest Top Stories

1. American Airlines’ fourth-quarter 2021 loss (excluding 2 cents from non-recurring items) of $1.42 cents per share compared favorably with the Zacks Consensus Estimate of a loss of $1.51. Quarterly loss per share was also narrower than the year-ago loss of $3.86. Average fuel price per gallon (including related taxes) climbed to $2.36 from $1.27 a year ago. AAL, currently carrying a Zacks Rank #4 (Sell), expects system capacity for the March quarter to decline in the 8-10% range from the figure reported in first-quarter 2019. Total revenues in the first quarter of 2022 are anticipated to decline in the 20-22% band from the level recorded in first-quarter 2019. Fuel cost per gallon in first-quarter 2022 is expected in the $2.41-$2.46 band. Fuel gallon consumption is expected to be $934 million. CASM excluding fuel and special items is expected to increase in the 8-10% range in the first quarter of 2022 from the number reported in first-quarter 2019.

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You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

2. Hawaiian Holdings’ fourth-quarter 2021 loss (excluding 44 cents from non-recurring items) of $1.37 per share was narrower than the Zacks Consensus Estimate of a loss of $1.69. HA reported a loss of $3.71 in the year-ago quarter. Moreover, quarterly revenues of $494.7 million surged more than 100% year over year and beat the Zacks Consensus Estimate of $493.4 million. HA expects Capacity in first-quarter 2022 to decline 10-13% from the first-quarter 2019 levels. Total revenues are anticipated to plunge 31-35% from the first-quarter 2019 levels.

3. Gol Linhas’ deal with private equity firm Castlelake is aimed at modernizing its fleet. Also, the same is in line with its objective to reach carbon neutrality by 2050. The jets to be bought consume 15% less fuel, produce 16% fewer carbon emissions and 40% less noise apart from possessing a greater flight range than the NG aircraft. The deal will include 10 finance leases and two sale-leasebacks. The interest for the lease is approximately 6%.

4. To expand its operations, Spirit Airlines aims to launch three routes from the Salt Lake City International airport or SLC on May 26. This marks SAVE’s debut in the tourist-friendly state of Utah. The non-stop flights will operate on a daily basis and connect SLC with Las Vegas, Los Angeles and Orlando. Through the new flights, SAVE intends to meet the anticipated demand swell this spring. Evidently, SAVE is the first airline to announce operations into the newly-rebuilt airport (worth $4.5 billion), which was unveiled in 2020.

Performance

The following table shows the price movement of the major airline players over the past week and during the last six months.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

The table above shows that almost all airline stocks have traded in the red over the past week. As a result, the NYSE ARCA Airline Index has decreased 4.2% to $78.92. Shares of Hawaiian Holdings have declined maximum as HA’s downbeat revenue guidance for the March quarter disappointed investors. Over the past six months, the NYSE ARCA Airline Index has depreciated 18.2%

What's Next in the Airline Space?

Fourth-quarter earnings reports from some more carriers are expected in the coming days.


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Gol Linhas Aereas Inteligentes S.A. (GOL) : Free Stock Analysis Report

American Airlines Group Inc. (AAL) : Free Stock Analysis Report

Spirit Airlines, Inc. (SAVE) : Free Stock Analysis Report

Hawaiian Holdings, Inc. (HA) : Free Stock Analysis Report

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