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Investing in the Friendly Skies Today

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  • Description

    Maxim Group aerospace analyst Ray Neidl gives his outlook for the airline industry.

  • Duration 3:11
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Well airlines are beginning to see their profits rise thanks to lower fuel costs -- my next guest says he is cautiously optimistic on the sector -- -- joining me now with his industry outlook -- -- aerospace analyst -- the maxim group for this -- on the road.

Where Al is going to talk to use so it looks like.

We're seeing capacity cuts again.

Airlines -- -- getting a break on jet fuel is it gonna be a good quarter for earnings.

It's gonna be a good quarter.

We're talking about the third quarter now and not as good as -- usually thought.

Because jet fuel prices have gone up during the summer he won't -- we -- little break now.

It's being delayed.

As far as the -- goes to unit revenue.

It's being squeezed you know we're only seeing.

1% increases in the industry early this year we have -- up around my 567%.

So the airlines are being squeezed on the revenue side and that's leading to the capacity cuts.

But but also making.

Record profits on fees whether it's back fees or you know you wanna move the seats -- -- -- five for much want to watch what election -- but that's -- five dollars as apple up.

I mean everybody is kind of really getting on this bandwagon is that and it is even though it's gonna make the customer magazine -- nickel and dime is not good for the industry.

And a reason to buy the stock.

So many cases those fees -- -- numbers and you -- -- that increasingly getting good big fees now.

But ticket price increases have stopped.

In -- -- -- just coming and.

I.

Thirty billion yielded a -- -- the be full -- that's -- -- the other thing we all know and that.

If if they have to film of this camp that the ticket prices from what understand early bookings through October are still pretty solid.

But the airlines are being very cautious particularly Europe is.

Becoming very weak.

Well not saying you've written a running your research -- that you're concerned about the fiscal -- her in this country and that could actually have a negative effect.

On the airline sector wide.

Let -- for next year people are doing their travel budgets for next year.

And that weighs over them I don't think anybody really believes that the politicians are dumb enough to let that happen but it is a consideration you have to take the -- -- travel budgets shall.

Tensions could be a little -- yeah -- -- less tightening just fossil let's look at some of the names that you that you -- as a litigator has some of the new -- to sell on AMR zero price target your what.

Happens to America.

Well American I think is -- doing your job restructuring which is that been a bankruptcy I think realtors can't plucked out much has happened with American stock.

I think they're restructuring of its new facility -- what's to come out of bankruptcy.

And the pilots have to agree -- do you believe that's gonna happen yeah I think you've got to buy delta your price started delta nineteen dollars.

A share right now are you still backing delta if you -- gonna get there.

Numbers from them yet we will get good numbers from that the airlines I think delta is probably the career of the old legacy carriers.

And -- failed to -- the semi gotta buy price target 25 bucks you they have still has some challenges with the merger.

That's -- -- prefer delta movie -- at this point.

I know -- may be different now we're gonna be doing that jetBlue promotion you know -- for the candidate getting your free ticket at a depth look at some us some numbers for the quarter as well.

-- -- thank you very much.

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