American Airlines to Cut International Capacity Next Summer
American Airlines Group Inc. AAL expects to reduce long-haul international capacity by 25% year over year during summer 2021 due to persistent softness in international travel demand. The carrier also plans to discontinue services to several leisure destinations that it expects will show reduced demand trends.
Among other services, the airline will terminate three trans-Atlantic routes from Charlotte Douglas International Airport and Philadelphia International Airport. Additionally, it will cease operations on five underperforming routes from Los Angeles International Airport to destinations in Asia and South America.
In order to offer customers a flexible booking experience, the carrier has extended change fee waiver for new tickets booked through Jul 31, 2020.
American Airlines Group Inc. Price
American Airlines Group Inc. price | American Airlines Group Inc. Quote
Load Factor Shows Improvement
Thanks to improvement in travel demand, American Airlines’ load factor (percentage of seats filled by passengers) rose to 45% in May and further to 63% in June from the low of 15% in April. The carrier transported 2.7 million and 4.2 million passengers in May and June respectively, indicating a marked improvement from only 965,000 passengers carried in April. However, the figures when compared with year-ago numbers reflect quite a bleak scenario. In the same months of 2019, the airline carried somewhere between 17 million and 19 million passengers.
Zacks Rank & Key Picks
American Airlines carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are Frontline Ltd FRO, Scorpio Tankers Inc STNG and Martin Midstream Partners LP MMLP, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Frontline’s current-year earnings has been revised upward by 17.1% in the last 90 days.
The Zacks Consensus Estimate for Scorpio Tankers’ current-year earnings has been revised upward by approximately 80% in the last 90 days.
Martin Midstream Partners has an impressive earnings history having outperformed the Zacks Consensus Estimate in three of the past four quarters, the average beat being 202.9%.
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American Airlines Group Inc. (AAL) : Free Stock Analysis Report
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