NEW YORK, July 19 (Reuters) - Shares of United Continental Holdings Inc fell as much as 5 percent on Wednesday, a day after the airline forecast "disappointing" passenger unit revenue, a closely watched measure, in the third quarter.
United, the No. 3 U.S. airline by passenger traffic, said passenger unit revenue, which measures sales relative to flight capacity, in the third quarter would be flat, versus a gain of 2.1 percent in second quarter from a year ago.
"Investors were estimating 3Q17 unit revenue would be flat to up 2 (percent); our estimate was up 1.5 (percent), so the guidance is disappointing," Cowen analyst Helane Becker wrote in research note.
Major U.S. carriers have just begun to break free from a years-long negative streak in passenger unit revenue, posting increases in the metric after more than two-and-a-half years of depressed performance.
Rival Delta Air Lines Inc recorded a 2.5 percent increase in passenger unit revenue in its second quarter and projected that the measure would continue tending positive into the third quarter, between 2.5 percent and 4.5 percent.
United said on Tuesday that unit operating costs, excluding fuel, rose more than 3 percent as rising labor costs weighed on the industry. Still, it posted adjusted earnings per share of $2.75, versus analysts' consensus forecast of $2.67.
United shares fell $3.63 to $75.24 at midday. It hit a session low of $74.92. (Editing by Jeffrey Benkoe)