Airline Earnings Hit Runway Next Week (CAL, UAUA, DAL, AAI, AMR, LCC, ALK, JBLU, LUV, FAA)

Continental Airlines, Inc. (NYSE: CAL) may still be trying to score on its UAL Corporation (NASDAQ: UAUA) merger, but earnings season features almost every major airline next week.  The news out of the earnings front will dominate other headwinds for airlines.  On deck are Continental Airlines, Inc. (NYSE: CAL), UAL Corporation (NASDAQ: UAUA), Delta Air Lines Inc. (NYSE: DAL), AirTran Holdings Inc. (NYSE: AAI), AMR Corporation (NYSE: AMR), US Airways Group, Inc. (NYSE: LCC), Alaska Air Group, Inc. (NYSE: ALK), and JetBlue Airways Corporation (NASDAQ: JBLU).  Southwest Airlines Co. (NYSE: LUV) is not due until the following week, but you can be sure that holders will be looking at next week’s major peer earnings.  While this is a thinly traded ETF, the Claymore/NYSE Arca Airline (NYSE: FAA) will almost certainly be one to watch next week.

Monday morning will be Delta Air Lines Inc. (NYSE: DAL) in the air.  Thomson Reuters has estimates at $0.63 EPS and $8.27 billion in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $ 0.95 EPS and $8.8 billion in revenues.  Shares are at $11.92 and the 52-week trading range is $5.58 to $14.94.

Tuesday morning will bring earnings from UAL Corporation (NASDAQ: UAUA).  Thomson Reuters has estimates at $1.74 EPS and $5.11 billion in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $2.57 EPS and $5.37 billion in revenues.  Shares are at $21.50 and the 52-week trading range is $3.18 to $24.59.

Wednesday morning brings earnings from AirTran Holdings Inc. (NYSE: AAI).  Thomson Reuters has estimates at $0.25 EPS and $708.2 million in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $0.17 EPS and $694.08 million in revenues.  Shares are currently at $4.85 and the 52-week trading range is $4.05 to $7.47.

AMR Corporation (NYSE: AMR) is out Wednesday with earnings. Thomson Reuters has estimates at -0.03 EPS and $5.71 billion in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $0.63 EPS and $6.0 billion in revenues.  Shares are currently at $6.95 and the 52-week trading range is $4.06 to $10.50.

Also Wednesday morning will bring US Airways Group, Inc. (NYSE: LCC) on the tarmac.  Thomson Reuters has estimates at $1.18 EPS and $3.16 billion in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $0.99 EPS and $3.15 billion in revenues.  Shares are currently at $8.95 and the 52-week trading range is $2.02 to $10.87.

Thursday morning will bring Alaska Air Group, Inc. (NYSE: ALK).  Thomson Reuters has estimates at $2.14 EPS and $966.37 million in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $3.27 EPS and $1.07 billion in revenues.  Shares are currently at $48.12 and the 52-week trading range is $20.12 to $54.13.

Continental Airlines, Inc. (NYSE: CAL) is also reporting on Thursday morning with a move to a huge EPS figure from a large loss last year.  Thomson Reuters has estimates at $1.52 EPS and $3.7 billion in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $2.21 EPS and $3.92 billion in revenues.  Shares are currently at $23.01 and the 52-week trading range is $8.87 to $25.58.

JetBlue Airways Corporation (NASDAQ: JBLU) is also due Thursday morning.  Thomson Reuters has estimates at $0.08 EPS and $939.64 million in revenues for the last quarter, and if the airline gives guidance the estimates for the existing quarterly reports due in October are $0.18 EPS and $1.02 billion in revenues.  Shares are currently at $5.96 and the 52-week trading range is $4.45 to $6.95.

Southwest Airlines Co. (NYSE: LUV) is not out with earnings until the morning of July 29.  Thomson Reuters has estimates at $0.27 EPS and $3.15 billion in revenues.  With shares at $11.88 today, the 52-week trading range is $6.61 to $13.97.

The Claymore/NYSE Arca Airline (NYSE: FAA) is thin volume and has a very low market cap with thin assets under management and has some international carrier exposure.  The weightings of 3 are very dominant: UAL Corp is 15.8%, Southwest is 13.48%, and Delta is 11.8%… so over 40% is tied up in 3 of the more than 20 components.

As far as our results of our poll over whether the airline merger between Continental and UAL should be allowed and how it affects your money, here are the results:

• Bad For Consumers: 508 votes, 35% of all responses
• Good For Consumers: 279 votes, 19% of all responses
• Good For Investors: 471 votes, 32% of all responses
• Bad For Investors: 204 votes, 14% of all responses

In short, for consumers, the response on the Continental-UAL merger was that 64.5% feel this bad for consumers.  On your investing money, 69.7% of responses feel this merger will be good for investors.

As you have seen in the 52-week trading ranges, the airline has some stocks in here that have rallied significantly from lows.  If you have flown lately to normal airline traffic destinations during any normal hours, the load factor on airplanes just feels significantly higher as there are almost no empty seats.  Pricing has been solid as airlines have not had to be as price sensitive, and if you fly most of these carriers you know that they have been able to pass on fee on top of fee to the consumer.

After such great tailwinds for the financial figures and after such great moves from lows, those airlines which somehow manage to disappoint on earnings will probably see some of the huge gains disappear.

JON C. OGG