Morgan Stanley Analyst On The Durable Surge In International Travel: Good News For US Airlines
Portfolio Pulse from Shivani Kumaresan
Morgan Stanley analyst Ravi Shanker predicts a durable surge in international travel, which is good news for US airlines. He expects the number of US passports issued in 2023 to set a new record due to the current travel boom. Delta Air Lines and American Airlines are set to expand flights to China once restrictions are eased. United Airlines is expected to be the most aggressive among the three due to its profitability on this route. Southwest Airlines has ratified several contracts with union work groups and continues negotiations. Frontier Group Holdings is facing fleet delays and operating challenges, but its stock is considered cheap enough to wait for 2024 normalization.
August 24, 2023 | 5:36 pm
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POSITIVE IMPACT
American Airlines is also planning to expand its flights to China, which could positively impact its financial performance.
The expansion to China could lead to increased passenger volume and revenues for American Airlines.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Delta Air Lines is set to expand flights to China once restrictions are eased, which could boost its revenues.
The expansion of flights to China, a major international market, could significantly increase Delta's passenger volume and revenues.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
United Airlines is expected to be the most aggressive among the three airlines in expanding its China flights due to its profitability on this route.
United Airlines' profitability on the China route could lead to aggressive expansion and increased revenues.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
Southwest Airlines continues negotiations with union work groups, which could impact its labor costs.
The outcome of the negotiations with union work groups could significantly impact Southwest Airlines' labor costs and overall financial performance.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
Frontier Group Holdings is facing fleet delays and operating challenges, but its stock is considered cheap enough to wait for 2024 normalization.
Frontier's current challenges could negatively impact its short-term performance, but the low stock price could make it a good long-term investment.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70