Southwest Airlines Co.
) will fly beyond national boundaries to three destinations in
the Caribbean Island from Jul 1, 2014. Currently, Southwest is
the only leading U.S. passenger carrier without international
Dallas-based Southwest has started selling summer tickets for
non-stop flights from Atlanta, Baltimore and Orlando in the U.S.
to Aruba, Bahamas and Jamaica in the Caribbean. However, the news
failed to excite shareholders as the stock ended 1.1% in the red
on Monday trade on Nasdaq.
Southwest already operates in Nassau and Montego Bay in the
Caribbean, Punta Cana in Dominican Republic and Cancun, Los Cabos
and Mexico City in Mexico through AirTran - its wholly owned
subsidiary. AirTran will continue to operate in these markets
till it gets fully integrated with Southwest by the end of
Going forward, the carrier plans to add other international
destinations from Houston, Fort Lauderdale, Florida and other
U.S. cities, but did not divulged details regarding these routes.
The company, which uses
The Boeing Co.
) 737 series of aircraft, has no plan of adding any bigger
Southwest has come a long way since its formation four decades
ago to a top carrier with an expanded national footprint.
However, technical glitches on its reservation system had stalled
its international expansion plans.
The carrier argued that it wants to target the over-fared
international routes, which would boost its performance. We
believe that if the company manages to price its tickets
attractively, it would grab a significant share in these markets.
On the flip side, archrival
JetBlue Airways Corp.
) increasing presence in these markets is a threat to its
The airline reported robust fourth quarter results with the
top and bottom line surpassing their Zacks Consensus Estimate.
Passenger revenue per available seat mile - a meaningful airline
metric - also increased 4.2% during the quarter. Strong bookings
and strategic initiatives taken by management aided the quarter's
Southwest currently carries a Zacks Rank #2 (Buy). Another
stock worth considering in the sector includes Zacks Rank #1
Spirit Airlines Inc.
BOEING CO (BA): Free Stock Analysis Report
JETBLUE AIRWAYS (JBLU): Free Stock Analysis
SOUTHWEST AIR (LUV): Free Stock Analysis
SPIRIT AIRLINES (SAVE): Free Stock Analysis
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