U.S. equities are extending higher on Monday, continuing the rebound seen at the end of last week as China’s “national team” helped bolster Chinese markets in overnight trading. Adding to the positive feelings are hopes for a meeting of U.S. and Chinese trade officials next week as well as more dovish comments from President Trump that he is critical of Federal Reserve chairman Jerome Powell’s hawkish stance.
While all the focus this year has been on the big-cap technology stocks, waves of buying demand have perked up other areas as well. In recent weeks, defensive areas like consumer staples and utilities have seen a lift on a rotation into areas of value. This week, transportation stocks are on the move.
Airline stocks in particular are looking ready for new money as a number of names are breaking out of recent consolidation or downtrend patterns.
Here are seven to buy now:
Airline Stocks to Buy: American Airlines (AAL)
American Airlines (NASDAQ:AAL) shares have risen up and over their 50-day moving average for the first time since March in what looks like the first step in an exit from a three-month consolation range. The company recently reported results on July 26 with earnings of $1.63-per-share beating estimates by 4 cents on a 3.7% rise in revenues. The beat was driven by a 6.2% increase in passenger-revenue-per-available-seat-mile in the Atlantic region.
The company will next report results on Oct. 25, before the bell. Analysts are looking for earnings of $1.19-per-share on revenues of $11.6 billion.
Airline Stocks to Buy: United Airlines (UAL)
United Airlines (NYSE:UAL) shares are breaking out to new highs, rising above the two-month range between $80 and $82 that traces back to overhead resistance seen back in the summer of 2017. The company enjoyed an upgrade to “Buy” from analysts at Macquarie on July 19. When management reported July traffic numbers on Aug. 8, revenue-per-mile increased by 6.9% from the previous year.
The company will next report results on Oct. 16, after the close. Analysts are looking for earnings of $2.90-per-share on revenues of $10.8 billion. When the company last reported on July 17, earnings of $3.23-per-share beat estimates by 16 cents on a 7.7% rise in revenues.
Airline Stocks to Buy: Delta Airlines (DAL)
Delta Airlines (NYSE:DAL) shares are up more than 3% in mid-day trading on Monday, testing the highs last seen in January and setting up what could be an exit from an upward tilting trading range going back to late 2016. When reporting July performance, the company highlighted a 4% year-over-year increase in revenue-per-mile.
The company will next report results on Oct. 11, before the bell. Analysts are looking for earnings of $1.76-per-share on revenues of $11.9 billion. When the company last reported on July 12, earnings of $1.77 beat estimates by 5 cents on a 9.1% rise in revenues.
Airline Stocks to Buy: Alaska Airlines (ALK)
Alaska Airlines (NYSE:ALK) shares are rising above their 200-day moving average on Monday, ending a downtrend going back to the summer of 2017 and exiting a year-long consolidation range. ALK found support near the lows seen back in the summer of 2016. The company was in the news earlier this month when one of its aircraft was hijacked from Seattle-Tacoma International Airport by a ramp worker and taken on a joyride (complete with F-15 escorts, acrobatic stunts and a fiery crash).
The company will next report results on Oct. 25, before the bell. Analysts are looking for earnings of $1.54-per-share on revenues of $2.2 billion. When the company last reported on July 26, earnings $1.66 beat estimates by 4 cents on a 2.6% rise in revenues.
Airline Stocks to Buy: Southwest Airlines (LUV)
Southwest Airlines (NYSE:LUV) is extending its two-month rally rising back to levels last seen in January for a 24% rally off of its June lows. Analysts at Cowen raised their price target to $66 back in July on confidence in an improving fare environment and better cost structure, both of which are bolstering margins.
The company will next report results on Oct. 25, before the bell. Analysts are looking for earnings of $1.06-per-share on revenues of $5.6 billion. When the company last reported on July 26, earnings of $1.26 beat estimates by 3 cents on 0.2% rise in revenues.
Airline Stocks to Buy: JetBlue (JBLU)
JetBlue (NASDAQ:JBLU) shares have popped back up and over their 50-day moving average, closing in on the late July high near the 200-day moving average and returning to the trading range that has predominated for most of the year. On Aug. 10, management reported that traffic in July increased 6.2% from the year-ago period.
The company will next report results on Oct. 23, before the bell. Analysts are looking for earnings of 43-cents-per-share on revenues of just over $2 billion. When the company last reported on July 24, earnings of 38-cents-per-share beat estimates by 2 cents on a 5% rise in revenues.
Airline Stocks to Buy: Spirit Airlines (SAVE)
Spirit Airlines (NYSE:SAVE) shares are surging, already up a third from the lows set in July, and returning to levels not seen since January, eclipsing the March highs. In its recent investor update, management projected a 25% increase in seat capacity this quarter and operating expenses, excluding fuel falling upwards of 4%.
The company will next report results on Oct. 24, after the bell. Analysts are looking for earnings of $1.15-per-share on revenues of $868.2 million. When the company last reported on July 25, earnings of $1.11 beat estimates by 2 cents on a 21.4% rise in revenues.
Anthony Mirhaydari is the founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
