Stocks of top U.S. airlines ready to soar: Barron's

Sun Jun 21, 2015 4:05pm EDT
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(Reuters) - Shares for the top four airline carriers in the United States could rise 15 percent to 50 percent due to less competition and falling fuel costs, according to the June 22 edition of Barron's.

Barron's noted the 2015 forecast for earnings before interest, taxes, depreciation, and amortization for American Airlines Group (AAL.O: Quote), Delta Air Lines (DAL.N: Quote), United Continental Holdings (UAL.N: Quote) and Southwest Airlines Co (LUV.N: Quote) is for 40 percent growth to $29.2 billion. That compares to when Wall Street forecasted 2015 EBITDA to rise 7 percent to $22.7 billion in June 2014 before fuel costs started to fall.

The report said a drop in revenue per available seat, an important metric watched by investors, is a brief bump rather than a sign of a longer-term challenge.

On Friday, American Airlines closed at $39.97 a share, Delta closed at $41.35, United Continental closed at $52.01, and Southwest closed at $33.86.

(Reporting by Jennifer Saba in New York; Editing by Paul Simao)

An American Airlines plane pulls up to a gate at Logan Airport in Boston, Massachusetts, United States June 13, 2015.  REUTERS/Brian Snyder