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JetBlue Airways’ (JBLU) July Load Factor Falls, Stock Down


Long Island City, NY-based JetBlue Airways Corporation JBLU posted a significant rise in air traffic for July. Traffic – measured in revenue passenger miles (RPMs) – improved 5.1% year over year to 4.48 billion. On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) expanded 5.9% to 5.14 billion.

Load factor or percentage of seats filled by passengers decreased 70 basis points (bps) to 87.1% in the month as capacity expansion outpaced traffic growth. This decline in load factor seems to have disappointed investors. Consequently, the stock declined 1.78% to $21.46 at the close of business on Aug 10.

The low-cost carrier registered a completion factor (system wide) of 97.5% in the month with 63.5% flights on schedule.

On a year-to-date basis, the carrier posted a 4.6% rise in RPMs while ASMs rose 4.7%, both on a year-over-year basis. Load factor fell 10 bps year over year to 85%.

JetBlue maintains its projection for revenue per available seat mile (RASM) in the third quarter of 2017 at the range of a decline of 0.5% to a rise of 2.5%.

This Zacks Rank #3 (Hold) company recently reported second-quarter 2017 earnings numbers. The carrier’s earnings (excluding special items) of 64 cents per share beat the Zacks Consensus Estimate by 8 cents. Operating revenues came in at $1,842 million, ahead of the Zacks Consensus Estimate of $1,822.1 million. Both earnings and revenues improved year over year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Airline heavyweights like Southwest Airlines LUV, American Airlines Group AAL and Alaska Air Group ALK have also reported their financial numbers over the past few weeks, each posting better-than-expected results.

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