Continue reading US Air Q1 Loss Smaller Than Expected

US Air Q1 Loss Smaller Than Expected originally appeared on BloggingStocks on Tue, 27 Apr 2010 14:00:00 EST. Please see our terms for use of feeds.

For years, it's been evident that smaller airlines have had an operating advantage, particularly when they use less expensive airports. They've been able to post better numbers as a result, and in the current travel slump, they've outperformed the larger carriers. Well, they've also picked up a considerable amount of market share.

According to a report by USA Today, low cost carriers now have 30% of the market in the United States. Price-sensitive consumers are turning to cheaper alternatives, even if it means (for fliers with elite status) giving up the perks they've earned through years of customer loyalty.

Continue reading Low cost carriers own 30% of domestic airline biz, growing fast

Low cost carriers own 30% of domestic airline biz, growing fast originally appeared on BloggingStocks on Tue, 10 Nov 2009 16:15:00 EST. Please see our terms for use of feeds.

There may be new hope for the perpetually ailing airline industry. While I wouldn't expect these companies to become top performers anytime soon, it looks like the best revenue stream is the one nobody's been talking about: change and cancellation fees.

These penalties, which can reach up to $150, bring $2 billion in revenue into the industry annually. According to the Department of Transportation, they were good for $527.6 million in the first quarter -- in the United States alone. This is 3.2% of U.S. airline revenue.

American Airlines parent AMR (NYSE: AMR) raked in $116 million in revenue from these penalties in the first quarter of 2009 -- compared to $108 million from the more highly publicized extra bag fees. For JetBlue (NASDAQ: JBLU), the numbers are smaller (JetBlue, of course, isn't as big as AMR) but no less compelling. By pumping its change and cancellation fee from $100 to $150, the airline scored $32.2 million in Q1 2009, up from $25 million in Q1 2008.

Continue reading Could cancellation fees save the airlines?

Could cancellation fees save the airlines? originally appeared on BloggingStocks on Thu, 30 Jul 2009 11:40:00 EST. Please see our terms for use of feeds.

US Airways (NYSE: LCC) is trimming 600 ground jobs and closing other services in an effort to cut costs. The airline had hoped not to cut this many positions, anticipating that resignations and departures would do the hard work for it. But employee attrition fell sharply from last year - probably because this isn't exactly the best market for job hunting. Unfortunately, the same reasons that cause employees to stay force US Airways to cut them loose.

At nine airports, US Airways is moving to outside contractors for ramp work. The Las Vegas US Airways Club will close and its staff cut. Also, the walk-up ticket counter at the airline's Tempe, AZ headquarters is on the chopping block.

Continue reading US Airways to slash 600 jobs, asks 400 flight attendants to take furlough

US Airways to slash 600 jobs, asks 400 flight attendants to take furlough originally appeared on BloggingStocks on Wed, 15 Jul 2009 10:30:00 EST. Please see our terms for use of feeds.

Virgin America to introduce 'premium economy class' originally appeared on BloggingStocks on Thu, 16 Aug 2007 20:15:00 EST. Please see our terms for use of feeds.

Continue reading Virgin America enters U.S. airspace -- What does that mean for U.S. airlines?

Virgin America enters U.S. airspace -- What does that mean for U.S. airlines? originally appeared on BloggingStocks on Thu, 19 Jul 2007 18:00:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• UBS upgraded US Airways (NYSE: LCC) to Neutral from Reduce based on valuation.

• Cigna Corp (NYSE: CI) was upgraded to Neutral from Sell at Banc of America to reflect the company's market share gains and share buybacks.

• Banc of America also raised Gentex Corp (NASDAQ: GNTX) to Buy from Neutral to reflect increased penetration of the company's new rear-camera display product.

• Deutsche Bank upgraded shares of China Life Insurance (NYSE: LFC) to Hold from Sell on valuation and the continued strong equity markets...

• Morgan Stanley raised DirecTV Group (NYSE: DTV) to Overweight from Equal Weight.

• Citigroup upgraded Sempra Energy (NYSE: SRE) to Buy from Hold.

• Acorda Therapeutics (NASDAQ: ACOR) was upgraded to Buy from Neutral at Banc of America.

• Merrill Lynch raised Citadel Broadcasting Corp's (NYSE: CDL) rating to Buy from Neutral.

• CyberSource Corp (NASDAQ: CYBS) was upgraded to Buy from Accumulate at ThinkEquity.

Analyst upgrades 6-19-07: CDL, CI, DTV, LCC and LFC originally appeared on BloggingStocks on Tue, 19 Jun 2007 10:56:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Citigroup downgraded shares of Circuit City Stores NYSE: CC) to Hold from Buy and lowered their target to $17 from $26 following management's second guidance cut in one month; the firm thinks there is more bad news to come. The electronics-retailer was also downgraded to Market Perform from Outperform at Raymond James and to Neutral from Buy at Robinson Humphries. Circuit City was cut to Sell from Hold at Soleil.

• UBS downgraded six airline stocks on fuel price concerns and their belief that demand may fall as economic growth slows in the domestic market. Downgrades are as follows: AMR Corp. (NYSE: AMR), UAL Corp. (NASDAQ: UAUA) and U.S. Airways Group (NASDAQ: LCC) were downgraded to Reduce from Buy; Southwest Airlines Co (NYSE: LUV) and Continental Airlines (NYSE: CAL) were downgraded to Neutral from Buy; JetBlue Airways Corp (NASDAQ: JBLU) was downgraded to Reduce from Neutral.

• General Electric (NYSE: GE) was removed from Goldman Sachs' Americas Conviction Buy list on valuation.

• Prudential expects Sprint Nextel Corp's (NYSE: S) company-specific problems to continue and weigh on shares and downgraded the phone-giant to Underweight from Neutral.

• Banc of America downgraded shares of LSI Corp (NYSE: LSI) to Neutral from Buy.

• Buckingham cut Best Buy Co (NYSE: BBY) to Neutral from Strong Buy.

Analyst downgrades 5-01-07: AMR, BBY, CAL, CC, GE and JBLU originally appeared on BloggingStocks on Tue, 01 May 2007 11:06:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Goldman cut Nortel Networks (NYSE: NT) to Sell from Neutral as the firm believes shares fully discount a successful execution on the cost restructuring.

• HSBC downgraded Bristol-Myers Squibb (NYSE: BMY) to Underweight from Neutral.

• JP Morgan sees few catalysts to drive airline shares higher and has downgraded the following stocks:

• AMR Corp (NYSE: AMR) and US Airways Group, Inc (NYSE: LCC) to Neutral from Overweight; Alaska Air Group, Inc (NYSE: ALK) and UAL Corp (NASDAQ: UAUA) to Underweight from Overweight; Continental Airlines, Inc (NYSE: CAL) and JetBlue Airways Corp (NADAQ: JBLU) to Underweight from Neutral.
  

• Keefe Bruyette downgraded Countrywide Financial Corp (NYSE: CFC) to Underperform from Market Perform, citing the impact of tighter credit standards for the move.

• OfficeMax Inc (NYSE: OMX) was cut to Underperform from Peer Perform at Bear Stearns.

• Matrix USA downgraded PepsiCo, Inc (NYSE: PEP) to Hold from Buy on valuation.

• Merrill Lynch downgraded Dean Foods Co (NYSE: DF) to Sell from Neutral.

Analyst downgrades 4-27-07: AMR, BMY, CAL, JBLU, PEP and UAUA originally appeared on BloggingStocks on Fri, 27 Apr 2007 11:13:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• A full page advertisement by CVS Corporation (NYSE: CVS) in this morning's Wall Street Journal (subscription required) warned Caremark Rx Inc (NYSE: CMX) shareholders that their "[investments] would be at risk" under Express Scripts' (NASDAQ: ESRX) proposal and recommended the CVS/Caremark merger. Also in the Journal:
• Investors at Clear Channel Communications Inc (NYSE: CCU) believe they are being short changed and have started a showdown with private equity buyers.
• The NYSE Group Inc (NYSE: NYX) and the Tokyo Stock Exchange are expected to announce an alliance.
• US Airways Group (NYSE: LCC) may increase its offer for Delta Air Lines (OTC: DALRQ).
• The Financial Times (subscription required) featured articles on News Corporation (NYSE: NWS) and Corus Group ADS (NYSE: CGA).
• News Corp's MySpace is close to launching local versions in Canada and Mexico.
• Tata Steel is expected to top CSN's offer for Corus Group at a takeover auction on Tuesday.

• USA Today wrote that two years ago, Verizon Communications' (NYSE: VZ) Verizon Wireless turned down the opportunity to be the exclusive distributor of the iPhone in the U.S. because of Apple Inc's (NASDAQ: AAPL) financial terms and other demands.
• Investor's Business Daily's "New America" column mentioned Universal Stainless & Alloy Products (NASDAQ: USAP) positively, writing that Universal is looking to expand abraod with little foreign competition. The specialty steel products company focuses on the aerospace and power industries and named Boeing Company (NYSE: BA) as a key customer.

Newspaper wrap-up 1-29-07: Verizon passed on iPhone originally appeared on BloggingStocks on Mon, 29 Jan 2007 09:28:00 EST. Please see our terms for use of feeds.

• US Airways Group Inc.' (NYSE: LCC) option implied volatility is at 49 into US Air raising its bid for Delta Air Lines (OTC: DALRQ). US Airways increased its proposed offer of merging with Delta, which is currently operating under bankruptcy protection. US Airways is offering $5 billion in cash and 89.5 million in shares of stock. US AIrways is recently up 1.26 to $59.16. US Airways overall option implied volatility of 49 is near its 26-week average, according to Track Data, suggesting non-directional risks.
• Las Vegas Sands Corp.' (NYSE: LVS) option volume, implied volatility and share price are all up on the right to develop Hengqin Island. Las Vegas Sands, the operator of the Sands Macau and Las Vegas Sands, is recently up $10.22 to $102.68. Jefferies said "after speaking with management today we learned that Las Vegas Sands was officially granted the right to develop on Hengqin Island, as we expected." Jefferies added "we currently value the project at $34 from the real estate development to be built over the course of 11 years." Las Vegas Sands call option volume of 20,530 contracts compares to put volume of 14,794 contracts. Las Vegas Sands February option implied volatility of 44 is near its 26-week average of 41, according to Track Data, suggesting larger price fluctuations.
  

Daily option update 1-10-07: US Airways, Las Vegas Sands highlighted originally appeared on BloggingStocks on Thu, 11 Jan 2007 09:00:00 EST. Please see our terms for use of feeds.