13-May-2010 3:49 PM

Full service carriers, especially Delta, rise on analyst note; ExpressJet reports improved traffic

North and South American carriers’ stocks gained again on Wednesday (12-May-2010) boosted by an analyst note and gains in the wider market. The Dow (+1.4%) rose on a boost in the technology sector, particularly gains from IBM.

A 1.0% decline in oil prices, to USD75.58, also pushed airline stocks higher. The AMEX Airline Index ended trading up 3.6%.

Full service carriers, especially Delta, rise on analyst note

UBS analyst, Kevin Crissey, stated fares for early Jul-2010 are 27% higher year-on-year but early bookings are down 8%, suggesting airlines are expecting a boost in demand from business passengers, who typically purchase fares late. He concluded the revenue outlook for the month is looking up as a result. Full service carriers rose as a result, with Delta Air Lines (+9.3%), US Airways (+6.9%), American Airlines (+5.8%), United Airlines (+4.2%) and Continental Airlines (+4.0%) all gaining.

Market Intellisearch stated Delta’s strong gain for the session pushed it above its 50-day moving average. The carrier reached a three-week intra-day high during trading. The carrier ended trading at USD13.55.

ExpressJet reports improved traffic results for Apr-2010

ExpressJet (-0.6%) was the only carrier down on Wednesday, despite reporting a 2.8 ppts year-on-year improvement in load factor for Apr-2010, to 79.5%. The improvement came as the rise in traffic (RPMs), up 24%, outweighed the increase in capacity, up 20% for the month.

ExpressJet ended Apr-2010 with a fleet of 244 aircraft consisting of 206 operating as Continental Express, 22 flying as United Express and 14 flying within Corporate Aviation (charter). The remaining two aircraft were in modification lines preparing to enter the United Express operation.

ATA forecasts small rise in passenger numbers for summer 2010

Also pushing stocks higher, the Air Transport Association of America (ATA) forecast that approximately 2.2 million passengers per day will travel globally on US airlines between 01-Jun-2010 and 31-Aug-2010 2010. This estimate of approximately 202 million passengers is an improvement of roughly 1% year-on-year.

The association also estimated fuel costs for the period would rise 20%, to USD2.19 per gallon.

America Airline Daily is your one-stop shop for news, data and analysis from the dynamic North American, Caribbean and Latin American aviation markets. Other stories featured in today’s issue include:

SkyWest declares 60th consecutive quarterly dividend;
Spirit Airlines pilots confirm 30-day cooling-off period from National Mediation Board;
US Transportation Secretary LaHood announces members of future of aviation advisory committee;
Air Canada CEO: carrier has made a start on targets;
Porter Airlines expands multi-flight Porter Pass programme.

North & South America selected airlines daily share price movements (% change): 12-May-2010