SUBSCRIBE

CATEGORIES

American, Southwest Gain As Leisure Travel Returns, Hope For Better Times

imageStock Markets14 minutes ago (Apr 22, 2021 08:38AM ET)

(C) Reuters.

By Dhirendra Tripathi

Investing.com – American Airlines (NASDAQ:AAL) and Southwest Airlines (NYSE:LUV) were both up in Thursday’s premarket following earnings updates that indicate better times for their sector as people look to get out and travel after a year of being locked in.

American Airlines reported its net loss fell to $1.3 billion in the March quarter from $2.2 billion in October-December. This was even as revenue remained unchanged at $4 billion.

The company’s total available cash of $17.3 billion at the end of the quarter was higher than its forecast of $15 billion liquidity and it said this could hit $19.5 billion by end of June, as cash flow improves with rising passenger numbers.

Southwest’s performance was even better as the airline managed to generate net income of $116 million for the quarter through March, after a net loss of $908 million for October-December.

For Southwest, total operating revenues rose by $100 million to $2.1 billion. It said it is in the process of adding flights in June, expects June available capacity to be only slightly less than June 2019 pre-pandemic levels.

While leisure travel bounces back, Southwest did warn “business travel is expected to have a significant negative impact on close-in demand and average passenger fares”.

That didn’t deter Jefferies (NYSE:JEF) analyst Sheila Kahyaoglu from maintaining a ‘buy’ on Southwest. She has a target of $75 for the stock, representing upside potential of some 21% from its present price of $62.

American, Southwest Gain As Leisure Travel Returns, Hope For Better Times

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.