Two Ways To Play: Airlines Take Off Terry Woo Jul 22, 2008 4:45 pm |
![]() |
![]() |
|
||||||||||||
|
Airline stocks had a big day today due in part to United Airlines parent UAL Corp (UAUA). Shares of the stock rose the most since the company emerged from bankruptcy in 2006 after the UAL reported better-than-expected second-quarter results and a number of cost-cutting moves. For the second quarter, UAL reported a loss of $2.73 billion mainly due to record-setting jet-fuel prices. Jet-fuel expenses for the company jumped 53% from a year earlier to $1.85 billion, outpacing face increases and new fees.
But the company announced it will cut 7,000 job, or approximately 13% of its workforce. UAL also said it will free up approximately $350 million in previously restricted cash due to an accord with JPMorgan Chase (JPM). UAL will receive a $600 million infusion from the sale of frequent flier miles to Chase for distribution to credit-card holders.
The stock jumped 64% today to close at $8.41. Other notables include Continental Airlines (CAL) +43% to $13.26, AMR Corp (AMR), +37.44% to $9.25, and Delta (DAL) +17.5% to $7.71.

From the Bull Pen: Part of the sentiment in the airlines was due to crude oil’s three dollar pullback. But bulls know some of the sharpest corrections occur in the context of a bull market. With that thought in mind, USO near $100 may look like a
good risk/reward opportunity. From the Bear Cave: “Short squeeze,” says Boo. The airlines have never been able to make money and they likely won't do so now.
|
|||||||
discuss this article and more on the mv exchange |
|
Get real-time options trading ideas from Steve Smith, veteran options trader and newsletter author, plus let him show you the way to cut risk and boost your returns through the strategic use of options. Click here for a free 14 day trial to OptionSmith by Steve Smith.
Terry Woo is an Editor at Minyanville Publishing & Multimedia, LLC.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any article or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2009 Minyanville Publishing and Multimedia, LLC. All Rights Reserved.
What's Popular in the 'Ville
Minyanville Local Guides
Business Services
Career
Cars
Computer Hardware
Construction
Education
Entertainment
Environmental
Family
Fashion
Financial Services
Food & Beverage
Franchise
Health
Holidays
Home Appliances
Home Electronics
Home Services
Industrial Goods & Services
Insurance
Internet
Legal
Miscellaneous
Nightlife
Online Database
Pets
Real Estate Resources
Retail & Consumer Services
Software
Technology
Telecommunications
Trade Shows
Travel
Weddings
World History
| add rss feed | free article alerts |










