Airline Stock Roundup: ALGT's Rosy Traffic Data, DAL's Expansion Update & More
In the past week, Allegiant Travel Company ALGT reported impressive traffic numbers for the month of February, driven by a buoyant air-travel demand scenario. Delta Air Lines DAL was also in the news, courtesy of its expansion-related update.
Hawaiian Holdings’ HA subsidiary, Hawaiian Airlines, has decided to adjust its schedule to match the anticipated demand swell during summer. Meanwhile, United Airlines UAL and Archer Aviation announced the first air taxi route in Chicago.
Read the last Airline roundup here
Recap of the Latest Top Stories
1 In February 2023, Allegiant carried 1.24 million passengers in scheduled service, up 13% from the February 2022 actuals. Revenue passenger miles (a measure of traffic) and available seat miles (a measure of capacity) increased 12.2% and 2.3%, respectively, from the year-ago levels. Load factor (percentage of seats filled by passengers) increased 7.6 points to 85.4% in February 2023, as the traffic increase was greater than the capacity expansion. Moreover, scheduled departures increased 3.1% year over year.
In February 2023, Allegiant, currently a Zacks Rank #3 (Hold) stock, carried 13.1% more passengers (systemwide) than in February 2022. Capacity increased 2.3% from the year-ago month’s reading. Departures (systemwide) improved 3.2% from the February 2022 actuals. The estimated average fuel cost per gallon for February was $3.53 (systemwide). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
2. Delta Air Lines’ management has decided to add new destinations to its network to take advantage of the upbeat air-travel-demand scenario. With an eye on the upcoming holiday season, Delta has decided to add seasonal routes from its hubs at Atlanta, New York-JFK, Detroit and Minneapolis to multiple tropical destinations. All flights will operate seasonally from Dec 16 through Jan 7, 2024.
Delta will add 20% more seats to its Latin America network in 2023 than the previous year. The massive expansion is aimed at making DAL’s Latin America schedule for 2023 holidays the largest in its history. As part of the expansion, DAL intends to widen the scope of its service to Mexico, Central America and the Caribbean. The company aims to cement its position as the leading carrier to Latin America from Atlanta and Detroit through its move to increase the frequency of its flights to popular destinations like Aruba and Cancun, Mexico. All flights will be equipped with modern facilities like free and fast Wi-Fi.
3. Hawaiian Airlines’ management has decided to increase weekly frequencies of its seasonal flights between Honolulu and Austin, Boston, Las Vegas and Pago Pago. HA also intends to add a fourth daily flight between Honolulu and Los Angeles. That flight will operate twice a week. "We're encouraged by the robust demand for travel to Hawaii this summer season and these increases signal a healthy return in our key North America markets," Brent Overbeek, senior vice president – chief revenue officer of Hawaiian Airlines said.
4 In a bid to reduce the commute time in Chicago, UAL and Archer Aviation have joined forces to start air taxi service in the city. Following the commencement of the service, expected in 2025, the time to travel from Chicago O’Hare airport to the city, which currently takes more than an hour during peak time, will be just 10 minutes. Per Michael Leskinen, president of United Airlines Ventures, " Both Archer and United are committed to decarbonizing air travel and leveraging innovative technologies to deliver on the promise of the electrification of the aviation industry."
The following table shows the price movement of the major airline players over the past week and during the last six months.
Image Source: Zacks Investment Research
The table above shows that most airline stocks have traded in the red over the last five trading days. The NYSE ARCA Airline Index has decreased 3% to $54.15. Over the course of the past six months, the NYSE ARCA Airline Index has increased 7.5%.
What's Next in the Airline Space?
Stay tuned for the usual news updates on the space.
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Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report
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