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Airline Stock Roundup: DAL Boosts Dividend Payout, JBLU Introduces Flights
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In the past week, Delta Air Lines (DAL - Free Report) grabbed headlines with management announcing a 50% hike in the quarterly dividend payout. This was the first dividend increase announced by DAL since its resumption of quarterly dividend payments last year following the COVID-induced hiatus. The decision reflects DAL’s shareholder-friendly approach. Financial prosperity owing to strong passenger revenues may have led to the dividend hike.
JetBlue Airways (JBLU - Free Report) also featured in the news courtesy of management’s decision to introduce new flights to strengthen its presence in Mexico. Alaska Airlines, the wholly-owned subsidiary of Alaska Air Group (ALK - Free Report) , also revealed an expansion-related update over the past week. In the meantime, United Airlines (UAL - Free Report) had a safety-related scare after a piece of engine lining fell off during takeoff from one of its flights.
Recap of the Recent Most Important Stories
1 Delta raised its quarterly dividend to 15 cents per share (annualized 60 cents per share), representing an increase of 50% over the previous payout of 10 cents per share (annualized 40 cents per share). The new dividend, which has been approved by the company’s board of directors, will be paid on Aug 20 to shareholders of record as of the close of business on Jul 30. Based on the closing share price of Jun 20, the increased dividend translates to a yield of 1.21%.
On a separate note, Delta announced its most expansive winter schedule yet to popular ski destinations. The 2024-25 winter schedule, operative between Dec 21, 2024 and Mar 30, 2025, sees a nearly 10% increase in seat capacity from the year-ago levels.
DAL was in the news recently when its management announced that it would soon start selling Premium Select seats on New York-Los Angeles flights to meet the increasing demand for premium travel experience. The story was covered in detail in the previous week’s write-up.
2. JBLU has launched flights between New York’s John F. Kennedy International Airport and Tulum’s Felipe Carrillo Puerto Tulum International Airport. JetBlue's new daily nonstop service from New York JFK to Tulum marks its third destination in Mexico, after Cancun and Los Cabos. The newly launched route will be served using JBLU’s Airbus A320 aircraft.
3 United Airlines flights have encountered quite a few mishaps this year, prompting the Federal Aviation Administration to tighten its supervision of UAL. In the latest safety-related scare, on Jun 20, a UAL plane, an Airbus A320 jetliner, turned back to a Connecticut airport following a piece of lining from an engine cover falling off during takeoff. The plane had 124 passengers and five crew members on board. Alternative arrangements were made for the passengers. The FAA will probe the incident.
4. Alaska Airlines launched a seasonal nonstop service between Anchorage and New York JFK. This is the sole nonstop service operational between the airports. The daily service, launched on Jun 13, will be available till Aug 19. The Anchorage-New York JFK route is the longest in ALK’s network. ALK uses the 737-8 aircraft to operate on the route as it has the longest range among the planes in the carrier’s fleet.
Performance
The following table shows the price movement of the major airline players over the past week and during the last six months.
Image Source: Zacks Investment Research
The table above shows that most airline stocks traded in the red over the past week. The NYSE ARCA Airline Index decreased 2.3% to $56.96. Over the past six months, the NYSE ARCA Airline Index has declined 14.5%.
What’s Next in the Airline Space?
Courtesy of the buoyant air travel demand scenario, passenger revenues are strong. Given this bullish backdrop, investors are likely to keenly wait and see if any other U.S. airline walks in DAL’s footsteps and increases dividends.
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Airline Stock Roundup: DAL Boosts Dividend Payout, JBLU Introduces Flights
In the past week, Delta Air Lines (DAL - Free Report) grabbed headlines with management announcing a 50% hike in the quarterly dividend payout. This was the first dividend increase announced by DAL since its resumption of quarterly dividend payments last year following the COVID-induced hiatus. The decision reflects DAL’s shareholder-friendly approach. Financial prosperity owing to strong passenger revenues may have led to the dividend hike.
JetBlue Airways (JBLU - Free Report) also featured in the news courtesy of management’s decision to introduce new flights to strengthen its presence in Mexico. Alaska Airlines, the wholly-owned subsidiary of Alaska Air Group (ALK - Free Report) , also revealed an expansion-related update over the past week. In the meantime, United Airlines (UAL - Free Report) had a safety-related scare after a piece of engine lining fell off during takeoff from one of its flights.
Recap of the Recent Most Important Stories
1 Delta raised its quarterly dividend to 15 cents per share (annualized 60 cents per share), representing an increase of 50% over the previous payout of 10 cents per share (annualized 40 cents per share). The new dividend, which has been approved by the company’s board of directors, will be paid on Aug 20 to shareholders of record as of the close of business on Jul 30. Based on the closing share price of Jun 20, the increased dividend translates to a yield of 1.21%.
On a separate note, Delta announced its most expansive winter schedule yet to popular ski destinations. The 2024-25 winter schedule, operative between Dec 21, 2024 and Mar 30, 2025, sees a nearly 10% increase in seat capacity from the year-ago levels.
DAL was in the news recently when its management announced that it would soon start selling Premium Select seats on New York-Los Angeles flights to meet the increasing demand for premium travel experience. The story was covered in detail in the previous week’s write-up.
Delta currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
2. JBLU has launched flights between New York’s John F. Kennedy International Airport and Tulum’s Felipe Carrillo Puerto Tulum International Airport. JetBlue's new daily nonstop service from New York JFK to Tulum marks its third destination in Mexico, after Cancun and Los Cabos. The newly launched route will be served using JBLU’s Airbus A320 aircraft.
3 United Airlines flights have encountered quite a few mishaps this year, prompting the Federal Aviation Administration to tighten its supervision of UAL. In the latest safety-related scare, on Jun 20, a UAL plane, an Airbus A320 jetliner, turned back to a Connecticut airport following a piece of lining from an engine cover falling off during takeoff. The plane had 124 passengers and five crew members on board. Alternative arrangements were made for the passengers. The FAA will probe the incident.
4. Alaska Airlines launched a seasonal nonstop service between Anchorage and New York JFK. This is the sole nonstop service operational between the airports. The daily service, launched on Jun 13, will be available till Aug 19. The Anchorage-New York JFK route is the longest in ALK’s network. ALK uses the 737-8 aircraft to operate on the route as it has the longest range among the planes in the carrier’s fleet.
Performance
The following table shows the price movement of the major airline players over the past week and during the last six months.
Image Source: Zacks Investment Research
The table above shows that most airline stocks traded in the red over the past week. The NYSE ARCA Airline Index decreased 2.3% to $56.96. Over the past six months, the NYSE ARCA Airline Index has declined 14.5%.
What’s Next in the Airline Space?
Courtesy of the buoyant air travel demand scenario, passenger revenues are strong. Given this bullish backdrop, investors are likely to keenly wait and see if any other U.S. airline walks in DAL’s footsteps and increases dividends.