UAL, AAL, DAL, JBLU, LUV: Why Are Airline Stocks Up Today?

After a month seemingly defined by downturns, airline stocks are in the green across the board today. Indeed, despite rapidly rising oil and fuel costs recently, airlines are seeing clear skies in the market lately. Travel appears to be making a comeback, as hotel stocks enjoy a similar uptick.

Inside the airplane cabin of a Delta flight.
Source: EQRoy /

What’s going on with airline stocks today?

Well, several of the highest flyers raised their outlooks for this quarter on higher demand and expectations that oil prices will fall. Delta (NYSE:DAL) expects to end its fiscal first quarter with revenue at roughly 78% of 2019 levels. This is an increase from previous expectations between 72% and 76% of 2019 levels, stated in January. United (NASDAQ:UAL) has a similar story, expecting revenue in Q1 near the top end of its 75%-80% of 2019 levels range.

Southwest (NYSE:LUV) now expects to reach between 90% and 92% of its first-quarter 2019 revenue. This represents an increase from its previous guidance, for 85% to 90% 2019 revenue, this quarter. The airline has also stated that March would be “solidly profitable,” despite predicting a net loss this quarter.

Finally, American Airlines (NASDAQ:AAL) believes it will reach roughly 17% lower than Q1 2019 levels. Previously, the airline laid out expectations for a 20% to 22% decrease from 2019.

Airline stocks are also likely soaring from oil prices, which have started to come back down.

Airline Stocks Soar on Wave of Optimism

Airlines across the board are seeing strong gains today. JetBlue (NASDAQ:JBLU), United, Delta and American are each up between 8% and 10% at the time of writing. Southwest (NYSE:LUV) is right behind them, up nearly 5%.

In addition to increasing demand, analysts believe this could be related to oil prices. This morning, oil prices have continued to recede from previous highs. Crude oil futures fell to $96 a barrel today, the lowest point this month. Indeed, oil and fuel prices have skyrocketed amid supply concerns related to Russia’s invasion of Ukraine. However, given potential ceasefire talks between the nations, the current decline in oil prices makes sense.

Oil prices are starting to fall back down somewhat, which presents an immediate bullish signal to airlines. Whether or not oil makes a full return to pre-war levels or demand for travel reaches pre-pandemic highs remains to be seen. However, investors will surely be keeping their eyes on the skies going forward.

On the date of publication, Shrey Dua 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 Publishing Guidelines.

With degrees in economics and journalism, Shrey Dua leverages his ample experience in media and reporting to contribute well-informed articles covering everything from financial regulation and the electric vehicle industry to the housing market and monetary policy. Shrey’s articles have featured in the likes of Morning Brew, Real Clear Markets, the Downline Podcast, and more.

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