Amid rising coronavirus cases in the United States, induced by the highly contagious Delta variant, U.S. airlines have been experiencing softness in bookings and a rise in trip cancellations over the past few weeks. Consequently, several airlines have lowered their expectations for the third quarter of 2021. Alaska Air Group ALK became the latest carrier to reduce its forecast for the current quarter after it experienced weakness in bookings due to a spike in coronavirus cases. The carrier now anticipates cash flow from operations in the range of 0-$50 million in the third quarter, compared with 0-$100 million expected previously. Revenue passengers are expected to decrease 21-23% from the 2019 level, compared with a 15-18% decrease anticipated previously. Total revenues are forecast to drop 19-21% from the comparable period in 2019 (earlier expectation: down 17-20%).
Last month, American Airlines AAL gave a heads up that its August revenues were falling short of expectations due to softness in bookings. Spirit Airlines SAVE estimates an impact of $80-$100 million on its revenues in the third quarter due to an uptick in cancellations and softer-than-expected booking trends caused by a spike in COVID-19 cases.
Southwest Airlines LUV slashed its third-quarter operating revenue guidance by three to four points from the previous guidance after it “experienced a deceleration in close-in bookings and an increase in close-in trip cancellations” in August. It estimates operating revenues to decline 15-20% in the third quarter from the comparable period in 2019. The carrier also expressed doubts about being able to achieve profits in the third quarter as it had previously expected.
Each of the stocks mentioned above carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Amid the surging coronavirus cases, last week, the European Union imposed fresh restrictions on non-essential travel to and from the United States, dealing a blow to the U.S. airlines. It was only in June that the EU had lifted travel bans on American visitors ahead of the busy summer holiday season. With the new travel advisory being non-binding, individual member countries can choose whether to require negative COVID-19 tests or quarantines or to allow U.S. visitors with proof of vaccination.
After a tumultuous 2020, U.S. airlines had begun recovering in 2021 with the rollout of coronavirus vaccines and the gradual easing of travel restrictions as Americans got inoculated. While air-travel demand had been steadily improving until this summer, the trend decelerated toward the end of July as the Delta variant caused a spike in coronavirus cases, forcing Americans to cancel travel plans. Amid the prevalent pandemic, airline companies expect a “choppy recovery.” The Delta variant-led softness in passenger numbers is likely to worsen the already sluggish recovery in business travel demand. Feeling the heat of the Delta variant, American Airlines expects business travel recovery to be slower than what it had previously experienced.
Mainly due to the above-mentioned Delta variant-induced headwinds, airline stocks have had a disappointing run on the bourse lately. The Zacks Airline industry has declined 0.4% in the quarter-to-date period against the S&P 500’s 22% increase over the same time frame.
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Shares of Peloton Interactive (NASDAQ: PTON) were falling 6% in midday trading Wednesday on no specific news related to the connected fitness equipment maker, but following a weeks-long slide in its stock. Peloton stock is now down 45% from its 52-week high and off more than 33% year to date. Doubts persist about the ability of Peloton to continue growing in a post-pandemic world.
Ines Ferre breaks down some of Wednesday’s early stock movers, including: Facebook lower after warning Apple’s privacy changes could impact Q3 results, Workhorse under pressure after halting electric van deliveries, and Netflix gaining after a price target boost at Stifel.
These stocks are all about the big payoff.
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Nio shares have taken a hit from macro news recently, but some company-specific developments may be pushing it higher today.
In this article, we discuss the top 10 oil and gas stocks to invest in. If you want to skip our detailed analysis of these stocks, go directly to the Top 5 Oil and Gas Stocks to Invest In. Oil stocks soared in the last week due to higher oil prices. West Texas Intermediate (WTI), […]The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 873 world-class investment firms that we track and now have access to the collective wisdom contained in […]Yahoo Finance's Emily McCormick provides the key points to know about FedEx's Q1 earnings.
One potential explanation for the surge in investor interest is a Barrons article published on Sunday that highlighted the fact that Boston Omaha's co-CEO Alex Rozek is Warren Buffett's grandnephew, and that he is beating the returns of his great uncle's company Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) so far this year. After all, Buffett has a track record of stellar returns that extends back to the mid-1960s. Boston Omaha's second-quarter results looked spectacular, its SPAC recently found an acquisition target, and its fast-growing broadband business launched a new subsidiary last week, Fast Fiber Homes, which has the potential to build a massive recurring revenue stream.
Stocks are falling in September after seven straight months of gains. Don't panic. Start shopping.
History has shown that a market sell-off is a great time to add quality companies to your portfolio. At a market capitalization of $300 billion, Adobe is one of the largest software companies in the world. The company breaks its results into three categories.
The neobank segment is growing at a fast clip, with many companies looking to dominate the space. Surveying this landscape, Jefferies' John Hecht thinks SoFi Technologies (SOFI) is well-positioned to take share. The 5-star analyst lists several reasons for his bullish outlook. For one, the company’s synergistic business model, what it terms the “Flywheel,” will continue to drive “significant user growth, product adoption, and margin expansion.” The Flywheel’s purpose is to help cross-sell its wi
These companies have delivered handsome dividend growth and can continue doing so in the years to come.
Sweeping new regulations are being floated for casinos in Macao that threaten the investment thesis of the entire gambling market in China, even as the region continues to struggle to climb out of the very deep hole caused by the coronavirus pandemic. The promise of intense new oversight, limits on the number of concessions or licenses issued, limits on the number of table games allowed, and having government officials oversee daily casino operations could set back resort plans for a rebound. China's also considering requiring casinos to get permission from the government before distributing dividends to shareholders.
Amid this September sell-off in stocks, investors need to keep Pinterest (NYSE: PINS) in mind. Concerns about how the company will fare in the post-pandemic world have led to modest drops in domestic usage and a massive decrease in the stock price. Such a response could imply the worst has ended for Pinterest stock, but investors may wonder whether that signifies a buying opportunity.
If ABBV closes above 110 on the expiration date, the shares will be called away at 110, leaving the trader with a total gains of $555.
Shares of semiconductor manufacturer Nvidia (NASDAQ: NVDA) — a supplier of chips for video gaming, cryptocurrency mining, artificial intelligence, and other markets — had jumped a solid 3.3% in Wednesday trading after CNBC reported last night that Goldman Sachs is bullish on U.S. semiconductor stocks. Tech market intelligence source International Data Corporation has just released its forecast for the semiconductor industry over the next two years. Mobile phones, notebooks, servers, automotive, smart-home devices, gaming, wearables, and Wi-Fi access are all growth markets for semiconductors, IDC says.
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Whatever investing strategy you follow, there are always going to be trade-offs between risk and reward. On the other hand, buying shares early in a company's lifecycle can offer the highest potential for gains if the business succeeds. Of course, each stock and each company is different, and some come with higher risks — and higher possible upsides.
Recent research seems to indicate that the company's coronavirus vaccine offers relatively long and reliable protection.