Allegiant, Alaska and US Airways lead carriers up on positive traffic

Friday (04-Sep-09) was a strong day for North and South American carriers, with all stocks ending the day up, except for Copa. As a result, the AMEX Airline Index rose by 2.9%.

The market rise came despite the US Government announcing the US unemployment rate was at a 26-year high in Aug-2009. The Dow (+1.0%) was meanwhile up, while oil prices (+0.1%) were steady, at USD68.02.

The rise in airline stocks was led by Expressjet (+5.0%) and Allegiant (+5.0%), despite Allegiant reporting a 3.2 ppts year-on-year decline in load factor in Aug-2009 the day prior.

Alaska Airlines (+4.0%), US Airways (+3.7%) and Air Canada-B (+3.7%) stocks also rose on the back of improved Aug-2009 traffic results announced late the day earlier.

Delta Air Lines (+3.2%) meanwhile reported its Aug-2009 traffic results during the day, with load factor improving 0.9 ppt for the month, to 86.6%. However, the carrier reported a 2.2% fall in passenger traffic, to 15.1 million passengers. Traffic (RPMs) was down 1.3%, on a 1.3% reduction in capacity (ASMs). Further assisting the carrier’s stocks was SmarTrend analysts’ announcement it is bullish on Delta’s shares. According to SmarTrend, Delta is currently above its 50 day moving average of USD6.52, but may not move past its 200 day moving average of USD7.27.

SmarTrend also announced it is bullish on United Airlines’ (+2.1%) stocks. According to the analysts, the carrier is now above its 50 day moving average of USD4.63.

GOL (+2.9%) rose following its announcement of improved yields for Aug-2009, above Jul-2009 levels.

Fellow LCC, JetBlue (+1.9%) meanwhile reported a 6% year-on-year reduction in PRASM for Aug-2009, much like Southwest (+2.3%) who also estimated a 5-6% fall in PRASM for the period. Southwest’s passenger traffic fell 3% year-on-year for the month, to 7.5 million passengers, as traffic (RPMs) rose 1%, on a 6.1% reduction in capacity (ASMs). This resulted in an impressive 5.6% rise in load factor, to 80.2%. Comparatively, JetBlue’s passenger traffic rose 4.4%, to 2.2 million passengers, as traffic remained flat, on a 0.6% capacity increase, resulting in a 0.5 ppt fall in load factor, to 86.6%.

Copa Airlines (-0.2%) slipped during the day, the only carrier of the Americas to be down at the end of trading.

North & South America selected airlines daily share price movements (% change): 04-Sep-09