Delta (DAL), U.S. Air (LCC) See Impact from Sequester in Q1, Lead Airlines Lower
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Price: $86.37 +2.60%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 1%
Revenue Growth %: +12.5%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 1%
Revenue Growth %: +12.5%
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Following quarterly results from Delta Air (NYSE: DAL) and U.S. Airways (NYSE: LCC), the segment is looking a little shaky Tuesday morning.
Delta reported Q1 EPS of $0.10, $0.04 better than the analyst estimate of $0.06. Revenue for the quarter came in at $8.5 billion versus the consensus estimate of $8.51 billion. Unadjusted net income slipped 94 percent to $7 million. PRASM rose 4.1 percent, while operating revs improved 1.0 percent, or $87 million.
Delta president Ed Bastian, commented, "We are taking actions to mitigate the decline in close-in demand we saw in the last part of March, and we expect the impact of the sequester, combined with a softening of leisure demand, to result in a 2 – 3 percent decline in April's unit revenues. However, a key benefit from a consolidated industry is that we now see a much stronger correlation between revenue and fuel; so while we are seeing some revenue softness, we are also benefitting from lower fuel costs, allowing us to continue our path of margin expansion even in a sluggish economic environment."
U.S. Air posted Q1 EPS of $0.31 on revs of $3.38 billion, versus estimates calling for EPS of $0.28 with revs of $3.37 billion. PRASM improved 2.2 percent
Delta and U.S. Air are both lower early, while United Continental (NYSE: UAL), JetBlue (Nasdaq: JBLU), and Southwest (NYSE: LUV) are also on watch.
Delta reported Q1 EPS of $0.10, $0.04 better than the analyst estimate of $0.06. Revenue for the quarter came in at $8.5 billion versus the consensus estimate of $8.51 billion. Unadjusted net income slipped 94 percent to $7 million. PRASM rose 4.1 percent, while operating revs improved 1.0 percent, or $87 million.
Delta president Ed Bastian, commented, "We are taking actions to mitigate the decline in close-in demand we saw in the last part of March, and we expect the impact of the sequester, combined with a softening of leisure demand, to result in a 2 – 3 percent decline in April's unit revenues. However, a key benefit from a consolidated industry is that we now see a much stronger correlation between revenue and fuel; so while we are seeing some revenue softness, we are also benefitting from lower fuel costs, allowing us to continue our path of margin expansion even in a sluggish economic environment."
U.S. Air posted Q1 EPS of $0.31 on revs of $3.38 billion, versus estimates calling for EPS of $0.28 with revs of $3.37 billion. PRASM improved 2.2 percent
Delta and U.S. Air are both lower early, while United Continental (NYSE: UAL), JetBlue (Nasdaq: JBLU), and Southwest (NYSE: LUV) are also on watch.
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