Alaska Air Group Posts November Traffic Data, View Revised

Alaska Air Group Inc. ALK recently reported traffic for November. Traffic, measured in revenue passenger miles (RPMs), increased 9.2% to 4.39 billion. On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) rose 9.3% to 5.22 billion. However, the load factor or percentage of seats filled by passengers declined 10 basis points to 84.2% as capacity expansion outpaced traffic growth.

At the end of the first 11 months of 2017, Alaska Air Group generated RPMs of 47.83 billion (up 7.2% year over year) and ASMs of 56.60 billion (up 6.8% year over year). Load factor stood at 84.5% compared with 84.2% in the first 11 months of 2017.

Q4 & Full-Year Guidance Revised

The carrier has provided a revised outlook for fourth quarter and full-year 2017. It now expects capacity in the range of 15.87 billion-15.92 billion in the fourth quarter of 2017. The metric’s prior outlook was in the band of 15.95 billion-16 billion. Fourth-quarter cost per available seat mile (CASM) excluding fuel and special items is anticipated between 8.63 cents and 8.68 cents, higher than the previous view of 8.50 cents-8.55 cents, mainly due to costs associated with pay related deal inked with its pilots. Economic fuel cost for the fourth quarter remains unchanged at $2 per gallon.

For 2017, capacity is projected between 62.05 billion and 62.08 billion, lower than the earlier outlook of 62.13 billion-62.16 billion. CASM excluding fuel and special items is predicted to lie between 8.22 cents and 8.24 cents. Earlier forecast was in the range of 8.19 cents-8.21 cents. The estimate for 2017 economic fuel cost per gallon stands at $1.83, an increase from the prior expectation of $1.82.

Alaska Air Group, Inc. Price

 

Alaska Air Group, Inc. Price | Alaska Air Group, Inc. Quote

Zacks Rank & Key Picks

Alaska Air Group carries a Zacks Rank #4 (Sell).

A few better-ranked stocks in the airline space are Gol Linhas Aereas Inteligentes S.A. GOL, International Consolidated Airlines Group SA ICAGY and Deutsche Lufthansa AG DLAKY. While Gol Linhas and International Consolidated Airlines sport a Zacks Rank #1 (Strong Buy), Deutsche Lufthansa carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Gol Linhas, International Consolidated Airlines and Deutsche Lufthansa have soared more than 200%, 51% and 100%, respectively, in a year.

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