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Airline Stock Roundup: UAL's Deal With Regional Carrier, ALK, ALGT in Focus

In the past holiday-shortened week, United Airlines UAL expanded its partnership with Dallas-based regional carrier JSX. Alaska Airlines, the wholly-owned subsidiary of Alaska Air Group ALK, launched an electronic bag tag program. Alaska Airlines became the first U.S.-based carrier to come up with such a customer-friendly offering.

Allegiant Travel Company ALGT also featured in the news courtesy of its partnership with DreamWorks Animation, pertaining to the release of Puss in Boots: The Last Wish later this month. Allegiant was also in the news recently when it reported upbeat traffic numbers for the month of October. That story was covered in detail in the previous week’s write-up.

Recap of the Latest Top Stories

1. The expansion of United Airlines’ agreement with JSX allows passengers aiming to travel on JSX's regional jets to book their tickets directly through United Airlines’ website. A deal between the two was first inked in March 2022, whereby a new private aviation track for students was created under UAL’s pilot career development program, Aviate. The scope of the association was further strengthened in June to permit members of UAL’s MileagePlus awards program to earn miles on the JSX flights. United Airlines currently carries a Zacks Rank #2 (Buy).

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

2. With DreamWorks Animation’s Puss in Boots: The Last Wish slated to release on Dec 21, the company has teamed up with Allegiant for promoting the movie. Following the association, fans across the United States stand the chance to win prizes and enjoy special Puss in Boots-themed experiences like fly aboard a special themed aircraft and enjoy Puss in Boots-themed onboard snacks. With the movie slated to arrive in the theaters during the holiday season, this customer-friendly move should go a long way in making the film a huge success. Expressing delight at the partnership, Scott DeAngelo, Allegiant's executive vice president and chief marketing officer said, “We're excited to team up with DreamWorks Animation's Puss in Boots: The Last Wish, because travel and entertainment go hand-in-hand when it comes to making lasting family memories, especially during the holiday season. Puss in Boots features beloved characters and a timely storyline that fans of all ages can relate to as they look to live life to its fullest.”

3. Following Alaska Airlines’ announcement to introduce the electronic bag tag program, passengers can tag their luggage through the airline's mobile app prior to reaching the airport. The move helps passengers to save valuable time as they can forego the step of printing traditional bag tags at the airport. In fact, the new offering is expected to bring down a passenger’s time spent in airport lobbies by 40%. As part of the first batch, 2,500 members of the Alaska Mileage Plan will start receiving their electronic bag tag.  Per Charu Jain, senior vice-president of merchandising and innovation, "We'll collect feedback from our first wave of users before the devices become available to purchase to all our guests early next year."

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 most airline stocks traded in the green over the past week. However, the gains were muted in nature. The NYSE ARCA Airline Index increased marginally to $61.11 over the past week. Over the course of the past six months, the NYSE ARCA Airline Index has declined 12%.

What's Next in the Airline Space?

Updates from Southwest Airlines’ LUV investor day on Dec 7 will be keenly awaited by investors. With air-travel demand soaring, we believe that this Dallas-based carrier’s management will present a rosy picture with respect to the top line.

With oil price still high, bottom-line growth is restricted. As a result, market watchers will keenly await the steps outlined to reduce costs and drive growth. Stay tuned for other usual updates in the space.

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United Airlines Holdings Inc (UAL) : Free Stock Analysis Report

Southwest Airlines Co. (LUV) : Free Stock Analysis Report

Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report

Allegiant Travel Company (ALGT) : Free Stock Analysis Report

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Zacks Investment Research