Yahoo Finance Alaska Air (ALK) Arm & Flight Attendants Ink Tentative Deal
Alaska Airlines, the wholly-owned subsidiary of Alaska Air Group ALK, reached a provisional pay-related agreement with Association of Flight Attendants-CWA. The tentative deal covers more than 6,500 flight attendants of Alaska Airlines. Further details of the agreement have not yet been released.
The deal, on materialization, is likely to result in a significant pay raise for the concerned employees. The provisional deal has been reached after two years of negotiations.
We note that tentative agreements do not necessarily mean the deal will be operational. The provisional deal inked by Alaska Air will now be voted upon by union members in the coming weeks after a presentation to the Alaska Airlines Master Executive Council. The provisional deal will be effective only if the voting result is favorable.
Shares of ALK have gained 5.4% year to date compared with its industry’s 13% growth.
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Even though ALK, currently carrying a Zacks Rank #2 (Buy), has reached a tentative labor deal, another U.S. airline, American Airlines AAL has not been so lucky. The union, representing AAL’s flight attendants, failed to reach a similar agreement, in turn increasing the probability of the carrier’s flight attendants going on strike.
Per a statement released by AAL, "We made good progress in negotiations this week, adding even more to the industry-leading proposal we've had on the table for months. We look forward to continuing negotiations so our flight attendants can benefit from the contract they deserve. This agreement is within reach and we look forward to additional dates being scheduled." We note that the two sides have been trying to reach an agreement for nearly a year.
With U.S. airlines grappling with labor shortage as air-travel demand bounced back strongly from the pandemic lows, we have witnessed quite a few deals of various labor groups in the airline space recently.
Another Airline Stock to Consider
Investors interested in the airline industry may also consider SkyWest SKYW, which presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
SkyWest's fleet modernization efforts are commendable. Upbeat air-travel demand also supports the company. The Zacks Consensus Estimate for SKYW’s 2024 earnings has improved 5.9% in the past 60 days. The stock has risen 52.2% year to date.
SKYW has an expected earnings growth rate of more than 100% for 2024. The company delivered a trailing four-quarter earnings surprise of 128.09%, on average.
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American Airlines Group Inc. (AAL) : Free Stock Analysis Report
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