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LATAM Airlines (LTM) May Traffic Hurt by Coronavirus Woes

Zacks Equity Research

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. Quote

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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