JetBlue Airways Corporation
) displayed marginal traffic growth across its network for the
month of March 2014. The carrier reported airline traffic -
measured in revenue passenger miles or RPMs - of 3.24 million, up
0.9% year over year. Consolidated capacity (or available seat
miles/ASMs) was also up 3.7% year over year at 3.82 billion.
The load factor or percentage of seats filled by passengers,
however, was 84.8%, down 230 basis points owing to relatively
slow traffic growth as compared to capacity. Passenger revenue
per available seat mile (PRASM) decreased 8% year over year, due
to the shift of Easter to April this year. The stock ended 3.23%
down on Thursday trade on Nasdaq following the news. The company
registered a completion factor of 98.0%, with on-time performance
In the first three months this year, JetBlue generated RPMs of
8.66 billion (up 1.8% year over year) and ASMs of 10.42 billion
(up 2.7% year over year). Load factor, moved south to 83.1% from
the year-ago figure of 83.9%.
JetBlue is expected to benefit from product introductions,
ancillary revenue opportunities and a matured network. The
company's growing presence in key markets and penetration into
untapped arenas will support its momentum.
The company plans to add service between Fort Lauderdale and
different Central American destinations like Port of Spain,
Montego Bay, and Punta Cana from May 2014. However, we believe
Southwest Airline Co.
) expected entry into the Caribbean Island from July 2014 could
affect its market share.
Further, the company has won bids to purchase take-off and
landing slots at Reagan National Airport (DCA) in Washington. The
slot purchase is part of a mega merger deal between American
Airlines and U.S. Airways Group that led to the formation of
American Airlines Group Inc.
JetBlue plans to add 24 daily round trip departures from DCA
to eight cities in 2014, thus bringing the total departures from
the airport to 30. These additional flights will allow JetBlue to
gain a significant portion of the Washington air service market
if it can price fares attractively.
JetBlue Airways carries a Zacks Rank #3 (Hold). Another stock
worth considering within this sector is
Alaska Air Group Inc.
), which carries a Zacks Rank #1 (Strong Buy).
AMER AIRLINES (AAL): Free Stock Analysis
ALASKA AIR GRP (ALK): Free Stock Analysis
JETBLUE AIRWAYS (JBLU): Free Stock Analysis
SOUTHWEST AIR (LUV): Free Stock Analysis
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