United Airlines
‘s latest plans to add more flights to Asia suggest the company, and the stock can keep benefiting from the overseas travel boom.
United posted record second-quarter earnings Wednesday largely thanks to surging international travel demand and sharply lower fuel costs.
Much of that can be credited to the airline being in tune with demand trends and being flexible with its expansion plans.
Just look at how proactive the carrier has been in capitalizing on surging demand. In April it announced plans to expand its overseas summer schedule by 25% after strong booking data the previous month.
That expansion included some Asian routes but United (ticker: UAL) has now announced a second ramp-up in the region, with new flights to Tokyo, Hong Kong, Taipei, and Manila this fall.
“International [travel] continues to drive higher results, especially in Europe and Asia. We expect Asia strength to accelerate into 2024 as people continue to ‘catch up’ on trips missed earlier in the decade.” TD Cowen analyst Helane Becker said in a note after United’s earnings.
United’s summer expansion has been a resounding success, helping the carrier to record earnings of $5.03 per share, beating expectations by an entire $1. It also hiked full-year earnings guidance to a range of $11 to $12, from a previous $10-$12 range.
The stock has climbed 45% so far in 2023, as of Wednesday’s close, in line with the gains made by
Delta Air Lines
(DAL) and
American Airlines
(AAL). The shares were 3% up ahead of the open Thursday.
It’s proving a bumper year for airlines and United may have just ensured that it stays that way for the carrier in the second half.
Write to Callum Keown at [email protected]
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