GOL Linhas Aereas Inteligentes S.A.GOL witnessed a decline in air traffic in the month of Nov 2015. Traffic - measured in revenue passenger kilometers (RPK) - stood at 2.89 billion, down 11% from 3.2 billion recorded a year ago.
Also, on a year-over-year basis, consolidated capacity (or available seat kilometres /ASKs) decreased 4.5% to 3.95 billion mainly because of a 3.4% and a 12% drop, respectively, in domestic and international capacity. Likewise, both domestic and international RPK in the month fell 10.9% and 11.1%, respectively.
Meanwhile, the load factor or percentage of seats filled by passengers fell to 73.2% from 78.5% recorded in Nov 2014. At the end of the first eleven months of 2015, RPK was up 1.8% while ASK climbed 1.1%. Load factor for the same period inched up 50 basis points.
Adverse conditions in the Brazilian economy coupled with foreign currency headwinds, owing to the strengthening of the U.S. dollar against the Brazilian real, largely resulted in the dismal performance. Moreover, in Nov 2015, the carrier witnessed a 12.8% drop in passenger count.
We expect these adverse factors to prevail in the near future as well.
Zacks Rank & Stocks to Consider
GOL Linhas currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same space are SkyWest Inc. SKYW , Hawaiian Holdings, Inc. HA and Southwest Airlines Co. LUV . SkyWest sports a Zacks Rank #1 (Strong Buy) while the other two companies carry a Zacks Rank #2 (Buy).