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JetBlue (JBLU) Stock Rises 15% in 6 Months: More Upside Ahead?
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JetBlue Airways’ (JBLU - Free Report) shares have gained 15% in the past six months compared with the industry’s 10.2% growth. The S&P 500 composite index rose 17.2% in the same time frame, while the Zacks Transportation sector declined 4.3%. The low-cost carrier currently has a market capitalization of $1.99 billion.
Image Source: Zacks Investment Research
Upbeat passenger volumes, owing to a buoyant air travel demand scenario, are primarily driving growth at JBLU. The airline operator, presently carrying a Zacks Rank #3 (Hold), boasts an impressive track record of beating estimates in three of the trailing four quarters (missing the mark in the other quarter). The average beat is 4.77%.
Can JBLU Retain the Momentum?
With people taking to the skies in large numbers, passenger revenues are high. The ongoing summer season is likely to provide a further boost to passenger revenues at JBLU.
In June, JetBlue’s management stated that it expects lower costs and a softer revenue decline in the second quarter of 2024. The company now anticipates its second-quarter revenues to decline between 6.5% and 9.5% year over year, which marks an improvement from the previous guidance of a 6.5% to 10.5% decline. Capacity or available seat miles are now anticipated to decline in the 2-4% range. This marks an improvement over the prior forecast of a decline in the 2-5% band. JBLU now anticipates non-fuel unit costs to increase 5-7%, down from the prior expectation of a 5.5-7.5% increase. JetBlue now expects second-quarter 2024 average fuel cost per gallon in the range of $2.85-$2.95 (prior view: between $2.98 and $3.13).
The company's efforts to modernize its fleet is impressive. Management expects to save $75 million from the fleet modernization program by 2024-end. JetBlue’s efforts to reduce its debt load is encouraging.
Despite the above-mentioned positives, one must be mindful of high labor costs, which pose a major challenge for JBLU. Owing to the uptick in labor costs, management expects 2024 non-fuel unit costs to increase in the mid-to-high single-digit range from 2023 actuals.
Stocks to Consider
Investors interested in the transportation sector may consider SkyWest (SKYW - Free Report) and Kirby Corporation (KEX - Free Report) .
SKYW has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 128%. Shares of SkyWest have increased 60.1% year to date.
KEX carries a Zacks Rank #2 (Buy) at present. Kirby has an expected earnings growth rate of 42.5% for the current year.
The company has an encouraging track record with respect to the earnings surprise, having surpassed the Zacks Consensus Estimate in each of the trailing four quarters. The average beat is 10.3%. Shares of Kirby have climbed 53.4% year to date.
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JetBlue (JBLU) Stock Rises 15% in 6 Months: More Upside Ahead?
JetBlue Airways’ (JBLU - Free Report) shares have gained 15% in the past six months compared with the industry’s 10.2% growth. The S&P 500 composite index rose 17.2% in the same time frame, while the Zacks Transportation sector declined 4.3%. The low-cost carrier currently has a market capitalization of $1.99 billion.
Upbeat passenger volumes, owing to a buoyant air travel demand scenario, are primarily driving growth at JBLU. The airline operator, presently carrying a Zacks Rank #3 (Hold), boasts an impressive track record of beating estimates in three of the trailing four quarters (missing the mark in the other quarter). The average beat is 4.77%.
Can JBLU Retain the Momentum?
With people taking to the skies in large numbers, passenger revenues are high. The ongoing summer season is likely to provide a further boost to passenger revenues at JBLU.
In June, JetBlue’s management stated that it expects lower costs and a softer revenue decline in the second quarter of 2024. The company now anticipates its second-quarter revenues to decline between 6.5% and 9.5% year over year, which marks an improvement from the previous guidance of a 6.5% to 10.5% decline. Capacity or available seat miles are now anticipated to decline in the 2-4% range. This marks an improvement over the prior forecast of a decline in the 2-5% band. JBLU now anticipates non-fuel unit costs to increase 5-7%, down from the prior expectation of a 5.5-7.5% increase. JetBlue now expects second-quarter 2024 average fuel cost per gallon in the range of $2.85-$2.95 (prior view: between $2.98 and $3.13).
The company's efforts to modernize its fleet is impressive. Management expects to save $75 million from the fleet modernization program by 2024-end. JetBlue’s efforts to reduce its debt load is encouraging.
Despite the above-mentioned positives, one must be mindful of high labor costs, which pose a major challenge for JBLU. Owing to the uptick in labor costs, management expects 2024 non-fuel unit costs to increase in the mid-to-high single-digit range from 2023 actuals.
Stocks to Consider
Investors interested in the transportation sector may consider SkyWest (SKYW - Free Report) and Kirby Corporation (KEX - Free Report) .
SkyWest currently sports a Zacks Rank #1 (Strong Buy) and has an expected earnings growth rate of 787% for the current year. You can see the complete list of today’s Zacks #1 Rank stocks here.
SKYW has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 128%. Shares of SkyWest have increased 60.1% year to date.
KEX carries a Zacks Rank #2 (Buy) at present. Kirby has an expected earnings growth rate of 42.5% for the current year.
The company has an encouraging track record with respect to the earnings surprise, having surpassed the Zacks Consensus Estimate in each of the trailing four quarters. The average beat is 10.3%. Shares of Kirby have climbed 53.4% year to date.