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Likely Coronavirus Impact on United Airlines (UAL) Q1 Earnings
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United Airlines Holdings Inc (UAL - Free Report) is slated to release first-quarter 2020 earnings results on Apr 30, after the market closes.
The company took a severe hit from the coronavirus outbreak during the first quarter. Consequently, the Zacks Consensus Estimate for first-quarter earnings has been revised significantly downward over the past 60 days.
Let’s delve into the details.
Factors at Play
United Airlines undertook massive capacity cuts during the first quarter due to declining air travel demand as well as mass-scale government travel restrictions as a result of the coronavirus outbreak. Consequently, the carrier’s passenger revenues, accounting for approximately 90% of the top line, are expected to have taken a hit. Notably, the Zacks Consensus Estimate for passenger revenues indicates an approximate 12% decline from the fourth-quarter 2019 reported figure.
Additionally, the airline’s cargo revenues are expected to have been affected by reduced demand caused by the coronavirus-led supply chain disruptions.The consensus mark for cargo revenues suggests an 18% decline from the previous quarter’s reported figure.
Given the likely impact on both passenger and cargo revenues, United Airlines anticipates total revenues of $8 billion for the first quarter, suggesting a 17% year-over-year decline. Moreover, pre-tax loss (on an adjusted basis) is projectedat $1 billion for the quarter.
However, with fuel expenses comprising a major chunk of airline expenditures, low fuel prices are expected to have partly mitigated the substantial loss of revenues. The Zacks Consensus Estimate for average fuel price per gallon hints at a 7.6% decline from the fourth-quarter 2019 reported figure.
United Airlines Holdings Inc Price and EPS Surprise
The proven Zacks model predicts an earnings beat for United Airlines in the first quarter of 2020. This is because the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: United Airlines has an Earnings ESP of +3.23% as the Most Accurate Estimate is pegged at a loss of $3.25 and the Zacks Consensus Estimate is pinned at a loss of $3.36. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: United Airlines carries a Zacks Rank #3.
Highlights of Q4 Earnings
In the last reported quarter, the company delivered a positive earnings surprise of 1.1%. The bottom line also improved 10.8% year over year, primarily on lower fuel costs. Meanwhile, operating revenues marginally beat the Zacks Consensus Estimate and also increased 3.8% on higher passenger revenues.
Other Stocks to Consider
Investors interested in the airline space may also consider Allegiant Travel Company (ALGT - Free Report) , Southwest Airlines Co. (LUV - Free Report) and Hawaiian Holdings, Inc. (HA - Free Report) as these stocks too possess the right combination of elements to beat on earnings this reporting cycle.
Allegiant has an Earnings ESP of +14.63% and a Zacks Rank #3.
Southwest Airlines has an Earnings ESP of +18.06% and a Zacks Rank #3. The company will report first-quarter 2020 earnings numbers on Apr 28.
Hawaiian Holdings has an Earnings ESP of +15.21% and a Zacks Rank of 3.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
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Likely Coronavirus Impact on United Airlines (UAL) Q1 Earnings
United Airlines Holdings Inc (UAL - Free Report) is slated to release first-quarter 2020 earnings results on Apr 30, after the market closes.
The company took a severe hit from the coronavirus outbreak during the first quarter. Consequently, the Zacks Consensus Estimate for first-quarter earnings has been revised significantly downward over the past 60 days.
Let’s delve into the details.
Factors at Play
United Airlines undertook massive capacity cuts during the first quarter due to declining air travel demand as well as mass-scale government travel restrictions as a result of the coronavirus outbreak. Consequently, the carrier’s passenger revenues, accounting for approximately 90% of the top line, are expected to have taken a hit. Notably, the Zacks Consensus Estimate for passenger revenues indicates an approximate 12% decline from the fourth-quarter 2019 reported figure.
Additionally, the airline’s cargo revenues are expected to have been affected by reduced demand caused by the coronavirus-led supply chain disruptions.The consensus mark for cargo revenues suggests an 18% decline from the previous quarter’s reported figure.
Given the likely impact on both passenger and cargo revenues, United Airlines anticipates total revenues of $8 billion for the first quarter, suggesting a 17% year-over-year decline. Moreover, pre-tax loss (on an adjusted basis) is projectedat $1 billion for the quarter.
However, with fuel expenses comprising a major chunk of airline expenditures, low fuel prices are expected to have partly mitigated the substantial loss of revenues. The Zacks Consensus Estimate for average fuel price per gallon hints at a 7.6% decline from the fourth-quarter 2019 reported figure.
United Airlines Holdings Inc Price and EPS Surprise
United Airlines Holdings Inc price-eps-surprise | United Airlines Holdings Inc Quote
Earnings Whispers
The proven Zacks model predicts an earnings beat for United Airlines in the first quarter of 2020. This is because the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: United Airlines has an Earnings ESP of +3.23% as the Most Accurate Estimate is pegged at a loss of $3.25 and the Zacks Consensus Estimate is pinned at a loss of $3.36. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: United Airlines carries a Zacks Rank #3.
Highlights of Q4 Earnings
In the last reported quarter, the company delivered a positive earnings surprise of 1.1%. The bottom line also improved 10.8% year over year, primarily on lower fuel costs. Meanwhile, operating revenues marginally beat the Zacks Consensus Estimate and also increased 3.8% on higher passenger revenues.
Other Stocks to Consider
Investors interested in the airline space may also consider Allegiant Travel Company (ALGT - Free Report) , Southwest Airlines Co. (LUV - Free Report) and Hawaiian Holdings, Inc. (HA - Free Report) as these stocks too possess the right combination of elements to beat on earnings this reporting cycle.
Allegiant has an Earnings ESP of +14.63% and a Zacks Rank #3.
Southwest Airlines has an Earnings ESP of +18.06% and a Zacks Rank #3. The company will report first-quarter 2020 earnings numbers on Apr 28.
Hawaiian Holdings has an Earnings ESP of +15.21% and a Zacks Rank of 3.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>