Will JetBlue Airways (JBLU) Q3 Earnings Beat Estimates?

Low-cost carrier JetBlue Airways Corporation (NASDAQ:JBLU) is scheduled to report third-quarter 2016 results on Oct 25, before the market opens.

Last quarter, the Long Island City, NY-based carrier posted a positive earnings surprise of 8.16%. The company has a solid track record with respect to earnings. It outpaced the Zacks Consensus Estimate in all of the last four quarters with an average earnings beat of 7.76%.

Factors to Consider

JetBlue’s bottom line is expected to benefit from low oil prices, while its top line is anticipated to have received a boost from the U.S. summer holiday season that ended in September. The company’s September operational results were impressive with an increase in both traffic and load factor.

However, the company could be adversely impacted by slow paced growth and foreign exchange volatility. The company also faces tough competition from peers like Southwest Airlines Co. (NYSE:LUV) and Delta Air Lines Inc. (NYSE:DAL) . Another concern is the decline in per unit revenue. According to the company guidance, revenue per available seat mile (RASM) is expected to decline in the range of 3–4% in the third quarter.

Earnings Whispers

Our proven model shows that JetBlue is likely to beat expectations this quarter because it has the right combination of two key ingredients.

Zacks ESP: JetBlue has an Earnings ESP of +1.70%. This is because the Most Accurate estimate stands at 60 cents and Zacks Consensus Estimate is pegged at 59 cents.

Zacks Rank: JetBlue carries a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank of #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating on earnings.

Conversely, we caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

JETBLUE AIRWAYS Price and EPS Surprise

Stock to Consider

Here is a company you may want to consider, as our model shows that it has the right combination of elements to post an earnings beat this quarter:

Navios Maritime Holdings Inc. (NYSE:NM) , with an earnings ESP of +15.39% and a Zacks Rank #2. The company is expected to report third-quarter earnings on Nov 28. You can see the complete list of today’s Zacks #1 Rank stocks here.

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