Barclays on U.S. Airlines: June RASM - Adjusting Estimates on LUV, ALGT & ALK

July 10, 2012 4:42 PM EDT Send to a Friend
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Barclays on U.S. Airlines: June RASM and 2Q Guidance Trickles in

Analyst, David E. Fintzen, says it appears RASM reports are leaning to the lower end of expectations.

For Southwest (NYSE: LUV), Fintzen said, "(its) steady as she goes: LUV reported a June RASM gain of 6%, which was lighter than the 7-8% gain we expected...For 2Q, our estimate declines slightly to $0.35 from $0.36, relative to the Street at $0.31 and estimates revised post the bulk of fuel declines at ~$0.33." FY12 from $0.85 to $0.84.

For Allegiant Travel (Nasdaq: ALGT), he said, "ALGT posts an impressive 2Q: ALGT's June RASM & 2Q investor update, outside of slightly higher fuel (~3c higher than our model), pointed to better performance in all drivers relative to the company's prior guidance and/or our expectations." Barclays raises Q2 EPS estimate from $1.05 to $1.28, FY12 from $4.35 to $4.65 and FY13 from $5.90 to $6.20. PT raised from $80 to $85.

Alaska Air (NYSE: ALK): "June and 2Q RASM a touch light: Following a softer-than-expected May RASM result, ALK released its 2Q investor update which points to an implied June RASM of ~3-3.5%. 2Q RASM of 3.5% (midpoint) is about 100bps lower than we had expected." FY12 EPS estimate lowered from $4.90 to $4.85 and FY13 from $5.60 to $5.45.


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