JetBlue CEO Says Their Growth Will Be The Strongest In The Aviation Industry By 2020
- Posted on December 24, 2019
- Stock Market
- By admin
Chief Executive Officer of JetBlue (NASDAQ:
JBLU), Robin Hayes, as well as other investment analysts on Wall Street, have
cleared the company stock for landing into investor portfolio in the coming
year.
Robin Hayes spoke on the First Trade segment of
Yahoo Finance said, “I think we will have one of the strongest earnings growth
stories of anyone in the airline industry from 2019 to 2020,” He said he is very
“confident” in JetBlue (JBLU) hitting its $2.50 to $3.00 per share profit
outlook originally shared at an investor day in September 2018.
JetBlue is a major American low-cost airline
and the seventh-largest in the United States based on the capacity of passengers
that can be carried. JetBlue is headquartered in the Long Island City. The
airline was founded in August 1998 and also generated a revenue of $7.658
billion in 2018. The company has assets worth $10.426 billion and over 22,000
employees.
In what may seem odd, stocks of JetBlue
continues to trade as if the company is not one of the best run airlines around
and it won’t see major earnings growth acceleration in 2020 even though there
are signs that it will. According to data obtained by Yahoo Finance, at a
forward price-to-earnings multiple of 7.8 times, JetBlue’s stock trades at a
noticeable discount relative to airline rivals Delta (DAL) (8.9 times) and
SouthWest (LUV) (10.3 times).
According to Yahoo Finance, JetBlue’s stock trading at about $18 at last check is hovering around the company’s $16.50 a
share book value. Meanwhile, the Street is only modelling JetBlue’s earnings of
$2.39 a share in 2020, well below the outlook Hayes reiterated once again on
Yahoo Finance’s airwaves.
Hayes agreed that the Street is concerned about
the revenue environment for JetBlue and the industry at large in 2020,
following fears of excess capacity. This may not be the case because below the
revenue line items are likely to increase the earnings of JetBlue in 2020.
Right now, JetBlue is almost at the end of
hitting its target of lowering expenses by close to $300 million. The company
unveiled a new $800 million stock buyback plan in October. And it is in the
midst of a major fleet overhaul which will likely boost productivity.
Goldman Sachs analyst, Catherine O'Brien says: “We
continue to believe that JetBlue’s structural cost program and changes to its
fleet will drive 2020 unit costs ex-fuel down year-over-year and that the
company has several revenue initiatives that should drive outperformance vs.
the industry. As such, we are forecasting that it will generate the highest
level of margin expansion across our airlines coverage universe.”
Well, in the coming year, Investing Port hopes
to keep an eye on the stocks of JetBlue and take note of changes.
Be the first to comment!
You must login to comment