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LATAM Airlines (LTM) May Traffic Hurt by Coronavirus Woes

Zacks Equity Research
·2-min read

LATAM Airlines Group S.A. LTM reported bland traffic numbers for May, primarily due to weak air travel demand stemming from the COVID-19 pandemic. Load factor (% of seats filled by passengers) deteriorated as traffic plunge outweighed capacity contraction.

Consolidated traffic (measured in revenue passenger kilometers or RPKs) of LATAM Airlines tanked 96.5% on a year-over-year basis. As this carrier trimmed capacity to cope with the bleak demand scenario, consolidated capacity (measured in available seat miles/ASMs) plunged 93.3%. Meanwhile, consolidated load factor dropped 39.8 percentage points to 43.8%. Passenger count too slumped 96.7%.

During the first five months of 2020, LATAM Airlines generated RPKs of 29,438 million (down 42.8% year over year) and ASMs of 36,913 million (down 39.8% year over year). Load factor declined 4.2 percentage points year over year to 79.8%. Passenger count at LATAM Airlines fell 38.9% in the January-May period.

LATAM Airlines Group S.A. Price

LATAM Airlines Group S.A. Price
LATAM Airlines Group S.A. Price

LATAM Airlines Group S.A. price | LATAM Airlines Group S.A. Quote

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Zacks Ranks & Key Picks

LATAM Airlines currently carries a Zacks Rank #4 (Sell).

A few better-ranked stocks in the Zacks Transportation sector are Air Lease Corporation AL, Ryanair Holdings plc RYAAY and Teekay Tankers Ltd. TNK. All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings (three to five years) growth rate for Air Lease, Ryanair Holdings and Teekay Tankers is estimated at 3.1%, 20.5% and 3%, respectively.

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Ryanair Holdings PLC (RYAAY) : Free Stock Analysis Report
 
Air Lease Corporation (AL) : Free Stock Analysis Report
 
Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
 
LATAM Airlines Group S.A. (LTM) : Free Stock Analysis Report
 
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Zacks Investment Research