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JetBlue (JBLU) to Post Q1 Earnings: What's in the Offing?

Zacks Equity Research
·4-min read

JetBlue Airways Corporation JBLU is scheduled to report first-quarter 2020 results on May 7, before market open.

The company has an impressive earnings history, having outperformed the Zacks Consensus Estimate in all of the last four quarters. It has a trailing four-quarter positive earnings surprise of 12.93%, on average.

Let’s see how things have shaped up in the quarter to be reported.

Factors at Play

We expect low demand for air travel due to the coronavirus pandemic to have dented JetBlue’s first-quarter performance and hurt passenger revenues, which contribute significantly to the company’s top line. To tackle low demand, the company resorted to capacity cuts. Evidently, the Zacks Consensus Estimate for capacity (measured in available seat miles) reflects a 1.6% decline on a sequential basis.

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JetBlue Airways Corporation Price and EPS Surprise

 

JetBlue Airways Corporation Price and EPS Surprise
JetBlue Airways Corporation Price and EPS Surprise

JetBlue Airways Corporation price-eps-surprise | JetBlue Airways Corporation Quote

 

The consensus estimate for operating revenue per available seat mile and passenger revenue per available seat mile is pegged at $12.35 cents and $11.92, which suggests a decline of 2.2% and 1.7% from December-end quarter’s levels, respectively. Yield per passenger mile is pegged at $14.79, which calls for a decline of 3.6% from the figure reported in the previous quarter end. Evidently, the Zacks Consensus Estimate for current quarter revenues is pegged at 1.69 billion, which indicates year-over-year decline of 9.67%.

The consensus mark for average fuel cost per gallon is at $2.15, which indicates a rise of 3.9% on a sequential basis. Again, JetBlue’s operating expenses per available seat mile (CASM) is expected to be $11.87, which suggests an increase of 5.8% from December end quarter’s figure. Excluding fuel, the metric is expected to be $8.84, which indicates a rise of 6.4% on a sequential basis. These factors are expected to have had a negative impact on the company’s earnings in the quarter to be reported. Notably, the Zacks Consensus Estimate for first-quarter 2020 earnings has been revised in the downward in the past 60 days to a loss of 42 cents from earnings of 18 cents.

What Does the Zacks Model Say?

Our proven model does not predict an earnings beat for JetBlue this time around. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP:  JetBlue has an Earnings ESP of -10.71% since the Most Accurate Estimate is pegged at a loss of 47 cents, lower than the Zacks Consensus Estimate of a loss of 42 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank:  JetBlue carries a Zacks Rank #3, currently.

Highlights of Q4 Earnings

In the last reported quarter, JetBlue’s earnings per share came in at 56 cents per share that  surpassed the Zacks Consensus Estimate by a penny. Moreover, quarterly earnings increased 12% on a year-over-year basis. Quarterly revenues of $2,031 million beat the consensus mark and increased 3.2% on a year-over-year basis.

Stocks to Consider

Investors interested in the Zacks Transportation sector may consider Golar LNG Limited GLNG, Hawaiian Holdings, Inc. HA and Alaska Air Group, Inc. ALK as these stocks have the right combination of elements to beat on earnings in this reporting cycle.

Golar LNG has an Earnings ESP of +1000.09% and a Zacks Rank #2.

Hawaiian Holdings has an Earnings ESP of +15.21% and a Zacks Rank #3. The company will report first-quarter 2020 earnings on May 5.

Alaska Air has an Earnings ESP of +11.06% and a Zacks Rank of 3. The company will report first-quarter 2020 earnings on May 5.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


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JetBlue Airways Corporation (JBLU) : Free Stock Analysis Report
 
Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report
 
Hawaiian Holdings, Inc. (HA) : Free Stock Analysis Report
 
Golar LNG Limited (GLNG) : Free Stock Analysis Report
 
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Zacks Investment Research