Loading

US Airways and United Continental stocks soar in strong earnings

Analysis

Shares in United Continental and US Airways surged 7.1% and 6.6% - their biggest one day gains since Oct-2010 - as fourth quarter earnings came in ahead of market expectations.

Summary
  • United Continental and US Airways saw significant increases in their share prices, with gains of 7.1% and 6.6% respectively.
  • Both airlines reported fourth-quarter earnings that exceeded market expectations.
  • United Continental's quarterly profit, excluding one-time items, reached USD 160 million, or USD 44 cents per share, surpassing market expectations of 24 cents per share.
  • US Airways reported net income of USD 28 million, or 17 cents per share, compared to a loss in the same quarter the previous year.
  • US Airways expects its revenue growth to outperform US GDP growth this year, and fare increases are helping offset higher fuel prices.
  • United Continental plans to increase seating capacity by 1-2%, primarily on international routes, while US Airways previously projected a 2% capacity increase.

Quarterly profit excluding one-time items at United Continental reached USD160 million, or USD 44 cents per share (ahead of market expectations of 24 cents), while US Airways reported net income of USD28 million, or 17 cents per share, compared with a loss of USD79 million, or USD0.49 per share, in the same quarter last year. US Airways stated revenue growth will outperform US GDP product this year and fare increases are helping offset higher fuel prices.

United expects to raise seating capacity by 1-2%, mostly on international routes, while US Airways previously forecast a 2% increase in capacity.

Selected North American airlines daily share price movements (% change): 26-Jan-2011

AAD

Want More Analysis Like This?

CAPA Membership provides access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets.
Find Out More