jetBlue Airways praised by analysts and rating is upgraded, but 1Q2016 unit revenue is pressured

jetBlue Airways has undergone numerous changes during the last couple of years ranging from a high level CEO change, to the introduction of its Mint premium product, to the marketing of new fare bundles that are expected to help lift the airline's overall revenue performance in 2016. The company has also significantly strengthened its balance sheet during that time, decreasing its leverage ratios by more than half since 2011.

After posting a passenger unit revenue premium to the industry in 2015, in 1Q2016 jetBlue is joining most other US airlines in forecasting a decline in unit revenues (the company is no longer breaking out its passenger unit revenue performance), driven in part by pressure on close-in bookings. jetBlue was largely immune from the pressures that dragged the unit revenues of many airlines downwards in 2015, but at the beginning of 2016 the airline joined the rest of the industry in bracing for a negative unit revenue performance.

jetBlue's strategy for combating unit revenue weakness is adjusting capacity in underperforming markets. If current pricing pressure lingers into 2H2016 the airline has stated that it would adjust its capacity in shoulder periods. But for now, jetBlue's 2016 capacity growth of 8.5% to 10.5% remains unchanged.