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GOL Linhas' March Traffic Rises, Upbeat Q1 Outlook Issued

GOL Linhas Aereas Inteligentes S.A.GOL reported air traffic figures for March. Traffic, measured in revenue passenger kilometers (RPK), inched up 0.7% to 2.97 billion.

On a year-over-year basis, consolidated capacity (or available seat kilometers/ASKs) slipped 0.9% to 3.78 billion, primarily due to a 3% decline in domestic capacity. While international RPK climbed 12.9%, domestic RPK slid 0.9% in the month. The carrier however, witnessed a 1.5% decrease in passenger count.

Load factor, percentage of seats filled by passengers, rose to 78.5% from 77.3%, recorded a year ago, as traffic expanded while capacity contracted.

At the end of the first three months of 2018, RPK increased 4.6% while ASK grew 2.2%. Also, load factor for the period improved 190 basis points. However, the company recorded a 0.2% dip in the volume of departures whereas the number of seats occupied by passengers remained flat on a year-to-date basis.

Gol Linhas Aereas Inteligentes S.A. Price

Gol Linhas Aereas Inteligentes S.A. Price | Gol Linhas Aereas Inteligentes S.A. Quote

Bullish Q1 Guidance

The carrier expects operating margin of 15-15.5% in first-quarter 2018 compared with the year-ago figure of 9.6%, a year ago. EBITDA margin is projected between 20% and 20.5%. Additionally, passenger unit revenue (PRASK) is anticipated to increase in the band of 10.5-11.0%. This upbeat passenger unit revenue guidance is owing to GOL Linhas' capacity discipline and efficient revenue management strategies.

Notably, capacity is likely to rise around 3% and unit revenue (RASK) to climb between 9.2% and 9.7%. Moreover, non-fuel unit cost (CASK ex-fuel) is predicted to decline approximately 3.5% in comparison to the first quarter of 2017.

Zacks Rank & Key Picks

GOL Linhas carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the airline space are SkyWest, Inc. SKYW , Cathay Pacific Airways Ltd. CPCAY and United Continental Holdings, Inc. UAL , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

Shares of SkyWest, Cathay Pacific Airways and United Continental have gained more than 21%, 10% and 8%, respectively, in the last six months.

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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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