JetBlue's (JBLU) August Traffic Rises, Load Factor Falls

JetBlue Airways Corporation (NASDAQ:JBLU) reported traffic figures for August. Traffic, measured in revenue passenger miles (RPMs), increased 3.9% year over year to 4.91 billion. Consolidated capacity (or available seat miles/ASMs) also expanded 6.1% to 5.64 billion on a year-over-year basis.

However, load factor or percentage of seats filled by passengers contracted 180 basis points (bps) to 86.9% in the month as traffic growth was outpaced by capacity expansion.

The Long Island City, NY-based low-cost carrier registered a completion factor (system wide) of 99% with 67.8% flights on schedule.

In the first eight months of 2019, the carrier posted a 5.9% rise in RPMs while ASMs grew 7.3%, both on a year-over-year basis. On the contrary, load factor deteriorated 110 bps to 85.2%.

The company maintains its projection for third-quarter revenue per available seat mile (RASM). The metric is anticipated to either slide up to 2% or remain flat year over year. The view includes a 1.25-point negativity from low bookings to Puerto Rico, a 0.75-point adversity each from Hurricane Dorian and challenges in Punta Cana, and a 1-point headwind from lower-than-expected demand across its system.

Zacks Rank & Key Picks

JetBlue carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space are Controladora Vuela Compania de Aviacion, S.A.B. de C.V. (NYSE:VLRS) , Copa Holdings, S.A. (NYSE:CPA) and Allegiant Travel Company (NASDAQ:ALGT) . While Controladora Vuela and Copa sport a Zacks Rank #1 (Strong Buy), Allegiant carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Controladora Vuela, Copa and Allegiant have rallied more than 96%, 29% and 51% so far this year, respectively.

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