3 Airline Stocks to Watch Amid the Geopolitical Turbulence

airline stocks - 3 Airline Stocks to Watch Amid the Geopolitical Turbulence

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Airline stocks are suffering these days, thanks to Vladimir Putin.

Russia’s president forced a pretty scary situation in Ukraine. Russia is launching dozens of missiles every day to achieve air superiority and pummel Kiev’s pro-Western government into submission.

There’s no telling how this is going to turn out. Most of western world condemned the invasion and issued harsh sanctions. Military and humanitarian aid is flowing into Ukraine, but Putin’s government is threatening anyone who gets involved on Ukraine’s side. Moscow even raised the threat of nuclear retaliation.

So, this one may not go away for a long time.

If you’re investing in airline stocks, you’ve already likely seen shares stumble. Here are three prominent airline stocks with prolonged exposure to the Russia-Ukraine war.

  • Boeing (NYSE:BA)
  • Wizz Air (OTCMKTS:WIZZ)
  • Delta Air Lines (NYSE:DAL)

Airline Stocks: Boeing (BA)

image of a Boeing 737 max aircraft
Source: Marco Menezes / Shutterstock.com

Boeing is one of the globe’s biggest aerospace manufacturers and defense contractors. It produces some of the best-known and widely used commercial aircraft in the world, including the Next Generation 737, the 737 Max, the 767 and the 777.

Making all those jets requires metal. And according to Boeing, one of the company’s key contacts has been Russia’s VSMPO-AVISMA, which supplies titanium.

In early March, Boeing suspended all business operations with VSMPO-AVISMA. It said in a statement:

Boeing has substantial titanium inventory due in part to an initiative several years ago to diversify our global sources. We have suspended purchasing titanium from Russia. Our inventory and diversity of titanium sources provide sufficient supply for airplane production, and we will continue to take the right steps to ensure long-term continuity.

BA stock is down 12% so far in 2022. It’s coming off a disappointing earnings report in which it posted revenue of $14.8 billion, missing analysts’ estimates.

Wizz Air Holdings (WIZZ)

Airbus A320 Wizz Air with attached passenger boarding stairs. Airport equipment.
Source: M101Studio / Shutterstock.com

Hungarian-based Wizz Air has been one of the most affected airlines from the Russian invasion of Ukraine.

Wizz, which trades on the Stoxx Europe 600 Index as well as on over-the-counter markets, usually has 11% of its daily flights headed to Ukraine, Belarus and Russia.

The company announced in March that it was ending commercial service to Russia and Ukraine. In Ukraine, it closed four hubs where it operated 40 routes, and is trying to safely remove four of its Airbus A320s. In Russia, the company ended service to Kazan, Moscow and St. Petersburg.

Wizz also announced it suspended service to Moldova at least until the middle of the year.

WIZZ stock is down 35% over the last two weeks. As the company is fully in crisis mode right now, you can expect this stock to continue to struggle for the foreseeable future.

Airline Stocks: Delta Air Lines (DAL)

Image of an airplane branded with the Delta Airlines (DAL) logo. Represents airline stocks.
Source: Lerner Vadim / Shutterstock.com

The U.S.-based airline cut its partnership tie with Russia’s dominant carrier, Aeroflot, after Moscow launched its invasion of Ukraine. The partnership allowed Delta and Aeroflot to book passengers on each other’s flights. But that won’t happen now.

“Delta has withdrawn our codeshare services operated in conjunction with Russian national airline, Aeroflot, effective immediately,” Delta said in a statement. “We have removed our code from Aeroflot-operated services beyond Moscow’s Sheremetyevo Airport and removed Aeroflot’s code from Delta-operated services from Los Angeles and New York-JFK.”

Delta also promised more than $1 million in humanitarian relief to Ukraine through the American Red Cross and the Global Red Cross Movement. The company donated another $100,000 through the United Nations.

Delta stock is down 10% so far in 2022, and lost 20% since hostilities in Ukraine began.

On the date of publication, Patrick Sanders did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Patrick Sanders is a freelance writer and editor in Maryland, and from 2015 to 2019 was head of the investment advice section at U.S. News & World Report. Follow him on Twitter at @1patricksanders.


Article printed from InvestorPlace Media, https://investorplace.com/2022/03/3-airline-stocks-to-watch-amid-the-geopolitical-turbulence/.

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