U.S. airlines are trading up on Tuesday: find out why


The major U.S. airlines on Tuesday raised their outlooks for revenue in Q1, indicating the industry was recovering from the pandemic at a pace that’s faster than originally anticipated. Here’s what they forecast now:

Southwest Airlines Co (NYSE: LUV)

The largest U.S. airline by market cap forecasts an exciting 92% recovery in first-quarter revenue. In late January, Southwest had warned that omicron could push it back into loss in Q1.

Delta Air Lines Inc (NYSE: DAL)

CEO Ed Bastian forecasts first-quarter sales to print at 78% of the levels seen before the pandemic in 2019. The previous forecast was for 72%.

United Airlines Holdings Inc (NASDAQ: UAL)

The Chicago-headquartered air carrier expects a close to 80% recovery in Q1 sales on returning business traffic and a jump in system bookings at large.

American Airlines Group Inc (NASDAQ: AAL)

The largest U.S. airline by passengers carried expects sales to be down only 17% from 2019 levels in Q1 versus 22% it had anticipated earlier.

Significance of the revised outlook

Stocks of all four airlines are up roughly 8.0% on Tuesday. The raised guidance is particularly promising for shareholders as it suggests that the air carriers will be pass able to pass on higher jet fuel prices and other costs to the customers. U.S. jet fuel prices are still up 35% year-to-date.

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