SOURCE: The Bedford Report
The Bedford Report Provides Analyst Research on JetBlue Airways & Alaska Air Group
NEW YORK, NY–(Marketwire – November 25, 2010) – The Airline industry has performed well as of late, with many companies reporting a speedy return to profitability after last year’s losses. The airlines are benefiting from a return in travel demand amid an industry wide effort to keep capacity from growing too fast. Going forward analysts expect airlines overall to further cement their turnaround despite rising fuel prices and an uncertain U.S. economy. The Bedford Report examines the outlook for companies in the Regional Airlines Industry and provides research reports on JetBlue Airways Corporation (
Many investors avoid airline stocks due to concerns about higher fuel prices. Following this month’s “QE2” announcement, one of the bigger concerns is that the already weak US dollar may become even weaker. When the greenback performs poorly against other currencies, crude oil tends to go up due to its relatively inverse relationship with the US dollar.
Many Airlines protect themselves from spiking fuel charges via “fuel hedging.” A fuel hedge contract commits an airline to paying a pre-determined price for future fuel purchases. Airlines enter into these contracts assuming that future fuel prices will be higher than current prices.
The Bedford Report releases regular market updates on the Major Airline Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at www.bedfordreport.com and get exclusive access to our numerous analyst reports and industry newsletters.
To be clear, there are some dangers with fuel hedging, and today, most airlines take a somewhat cautious approach following catastrophic losses from hedging in 2008 when oil prices spiked and then came crashing down.
In the most recent quarter Alaska Air Group posted mark-to-market fuel hedge gains of $16.7 million. In the third quarter Alaska Air Group posted record profits of $3.21 per diluted share.
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The Bedford Report