Company news - CNNMoney.com - Mar 10, 2010Southwest Airlines Company (LUV)
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Bob McAdoo
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Avondale PartnersRaymond Neidl, airline consultant, said that stocks were being fueled by an uplift in seasonal travel, a sense that the economy is recovering, and the airline industry's ability to maintain capacity constraint and cost controls.
He also said airline stocks are being lifted by "expectations that [airline] losses will be greatly reduced this year, or the industry might even make a small profit.". Bob McAdoo, airline consultant for Avondale Partners, said this sentiment was sparked by this week's reports from Southwest Airlines ( LUV , Fortune 500 ) and United of double digit increases in passenger revenue per available seat mile for February. He said investors are reading into these "growth numbers" as a sign of better times for the industry going forward. This follows a report from the Air Transport Association last month that air passenger revenue edged up 1.4% in January, ending a 14 month decline. The increases in passenger revenue are partly the result of capacity reduction, a cost cutting measure that the industry has implemented in recent years to make up for rising fuel costs.
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Raymond Neidl, airline consultant, said that stocks were being fueled by an uplift in seasonal travel, a sense that the economy is recovering, and the airline industry's ability to maintain capacity constraint and cost controls.<span class="sent"> He also said airline stocks are being lifted by "expectations that [airline] losses will be greatly reduced this year, or the industry might even make a small profit.". <span class="analyst">Bob McAdoo</span>, airline consultant for Avondale Partners, said this sentiment was sparked by this week's reports from <span class="company">Southwest Airlines</span> ( LUV , Fortune 500 ) and United of double digit increases in passenger revenue per available seat mile for February.</span> He said investors are reading into these "growth numbers" as a sign of better times for the industry going forward. This follows a report from the Air Transport Association last month that air passenger revenue edged up 1.4% in January, ending a 14 month decline. The increases in passenger revenue are partly the result of capacity reduction, a cost cutting measure that the industry has implemented in recent years to make up for rising fuel costs.
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