Skip navigation
MOST POPULAR RELATED TAGS
  • TOPICS
  • SECTORS
  • COMPANIES

Current DateTime: 12:36:25 11 Nov 2009
LinksList Documentid: 24355697
powered by digg
See all Play-by-Play postsSee all Squawk on the Street posts
Text Size
Dec.07
10:02 AM ET
Thursday, 7 Dec 2006
Analyst: Airline Stocks Going Up, Up And Away

Airline stocks are climbing higher on a holiday travel tailwind. According to the Dow Jones U.S. Airlines Index over the past month--they’re up 9% and more than 17% year to date.

How much higher can they go? On "Squawk on the Street"--CNBC’s Mark Haines asked David Strine--Airline Analyst with Bear Sterns.

Strine said the cycle is sturdy and his firm is still positive about the group for 3 reasons:

- supply looks like it will be constrained
- the fuel hedges for the low cost carriers are declining so they will need to raise fares
- there's an increasing probability of M&A activity in the industry.

He also said capacity is always an issue in this industry, and there's a window for a year or two where it will be hard to get aircraft.  Mechanisms are in place that will keep a cap on the growth of supply - and if that happens while the economy grows, we have a sweet spot.

Strine says on a valuation basis the carriers that look least expensive to his firm are United [UAUA  Loading...      ()   ] and Alaska [ALK  Loading...      ()   ] airlines. Bear Sterns has a sell on Frontier [FRNT  Loading...      ()   ].

Analyst Disclosure: AAI, ALK, CAL FRNT are or during the past 12 months have been a non-investment banking client (securities related services) or Bear Stearns & Co. AMR is or during the past 12 months has been a non-investment banking client (securities related services) of Bear Stearns & Co.

(.DJUSAR)
Loading...       (%)


Tools:
PrintEmailAdd This share icon
  • digg share

CNBC HIGHLIGHTS

  • Vote and suggest your own, and remember--there's a fine line between a hero and a zero.
  • If you are lucky enough to have money and the time, this is a great time to see America, says CNBC's Jane Wells.
  • What’s powering your microwave, fridge and computer? Part of it is fuel from Russian nuclear weapons. The NYT reports.
  • Mickey Mouse
  • One author sees lessons for you in Disney’s recent Makeover of Mickey Mouse: “Nice” doesn’t always win.
  • With 123 years of history, slogans and commercials, Coca-Cola is the most recognized brand on earth.
  • The opening of a virtual pet store in “World of Warcraft” could prove a cash bonanza for Activision-Blizzard.
ADD COMMENTS
Remaining characters


Current DateTime: 02:47:39 10 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 01:04:20 10 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 11:16:40 10 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 01:02:20 10 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters