Are the Airlines Really Value Stocks?

Welcome to Episode #18 of the Value Investor Podcast

Every week, Zacks value stock strategist and the Editor of Zacks Value Investor portfolio service, Tracey Ryniec, talks about all things happening in the value stock universe, including her top stock picks.

It was recently revealed that Warren Buffett's Berkshire Hathaway bought shares in 4 airline stocks.

This was shocking because Buffett has railed against the airline stocks for decades. He first bought into the industry in 1989 when he invested in US Airways and it did not end well. He has been so anti-airline over the years he has called them "death traps" for investors.

But new quarterly filings show that Berkshire has bought shares in:

1. Delta Air Lines, Inc. (DAL): forward P/E of 8.5

2. United Airlines (UAL): forward P/E of 8

3. American Airlines (AAL): forward P/E of 7.9

4. Southwest Airlines Co. (LUV): forward P/E of 12.4

Are the airlines still value stocks? Should value investors be following Berkshires lead?

Tracey examined each of these to see if they are still attractive buys.

Additionally, she looked at a couple other airlines that she does like including Hawaiian Holdings (HA), which is the largest airline serving Hawaii, and Copa Holdings SA (CPA) which is based in Panama and has a niche in Central and South America's emerging middle class.

Tracey also examines why someone would need to buy FOUR airlines stocks. Why not just 1 or 2?

Find out what else Tracey thinks of Buffett's airline buy and more on this week's podcast.

Want more insights from Tracey?

Check out her weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks she thinks are the best bargains now.

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SOUTHWEST AIR (LUV): Free Stock Analysis Report

DELTA AIR LINES (DAL): Free Stock Analysis Report

HAWAIIAN HLDGS (HA): Free Stock Analysis Report

UNITED CONT HLD (UAL): Free Stock Analysis Report

AMER AIRLINES (AAL): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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