Will Airline Stocks Fly High?

Have you benn on a plane flight recently? I've been on several plane flights over the last year and one thing I have noticed is that the plane is always full. Always! Not one extra seat available. And this is on a few different airlines, Delta (DAL), KLM Royal Dutch Airlines (KLMR), and JetBlue (JBLU). I remember years ago, taking flights on PSA with only eight people on the plane. There were almost as many airline staff workers (pilots and flight attendants) as there were passengers.

Now airlines have their act together, and are able to fill every seat. Any empty seat is less revenue, and if they can fill those seats, even at very discounted prices, it's additional revenue. When you consider all the flights of an airline in a day, and multiply those flights times 365 days, the revenue can add up.

With the merger of the American Airlines holding company, AMR (AAMRQ) and US Airways (LCC), it will mean less competition. And of course with crude oil dropping in price to $88 per barrel from over $105 a barrel a year ago, fuel costs for the airlines have been kept in check.

So what's an investor to do who is looking for a high flyer? According to the free list of airline stocks at WallStreetNewsNetwork.com, there are over 25 airlines to choose from, with a half dozen paying dividends.

Let's take a look at Alaska Air Group (ALK), which provides flights to the western United States, Canada, and Mexico. The stock trades at 13.7 times trailing earnings and 9.5 times forward earnings. Revenues for the latest quarter at year end were up 8.4%, however earnings dropped 31.3%. The company's next earnings announcement is scheduled for April 25. The company carries over a billion dollars in debt, but it does have $1.25 billion in cash.

The Latin American airline company, Copa Holdings SA (CPA), is doing well. Based out of Panama City, Panama, it flies to 64 destinations in 29 countries in North America, Central America, South America, and the Caribbean. The stock has a trailing price-to-earnings ratio of 16.4 and a forward PE of 10.9. Revenues were up by a strong 19.4%, but earnings dropped for the latest quarter by 17%. Next announcement is May 6. This is one of the few companies that pays a dividend with a Certificate of Deposit beating yield of 1.9%.

Southwest Airlines (LUV) is another dividend payer, with a small yield of 0.3%. The stock trades at 23.8 times current earnings and 11.1 times forward earnings. Next earnings announcement is April 25.

To see a complete list of all the major and regional airline stocks, which can be downloaded, sorted, and updated, go to WallStreetNewsNetwork.com.

Disclosure: Author owns JBLU.

By Stockerblog.com

Stocks With Lots of Cash

Lots of cash is great, whether you are an individual or a company. One key statistic that value investors examine who look at value stocks is the cash per share. The cash per share is determined by taking all the cash on the company's book divided by all the shares that are outstanding. If the price of the stock is below the cash per share, and assuming the company has little or no debt, then it may be a great value investment.

There are plenty of stocks that sell below the cash per share, but you may want to avoid certain ones because they carry huge amounts of debt. A few airlines fall into that category, such as US Airways Group (LCC) and United Continental (UAL), both of which trade way below the cash per share but have debt in the billions.

Fortunately, investors can still find stocks trading below cash with little or no debt. WallStreetNewsNetwork.com just updated its list of stocks selling below cash, which also includes data on the forward price to earnings ratio, the market capitalization, the cash per share, and the total debt.

One example is the Livermore, California based FormFactor, Inc. (FORM), which makes and markets precision and high performance advanced semiconductor wafer probe cards used for testing chips and other devices. The company should continue to benefit from the appetite for microprocessors. This debt-free stock has over $6.25 in cash per share yet closed at only $5.71, a 9% discount. The stock is also selling at a big discount to its book value of 7.48. The stock trades at 1.61 times sales. The company reported a net loss of 1.17 per share for the latest quarter, but generated a 10% increase in revenues.

Another example is Digital River Inc. (DRIV), a Minnesota based outsourcer of e-commerce solutions, primarily online sales channel capability. The stock trades at 15.43 trading at a 13% discount to its cash per share of 17.79 and its book value of 17.74. The stock trades at 12.7 times forward earnings, and 1.51 times sales, with revenues rising 123%. The does have some debt in the mount of $354 million.

For a list of stocks trading below cash per share, which you can update and sort, go to WallStreetNewsNetwork.com.

Disclosure: Author didn't own any of the above at the time the article was written.

By Stockerblog.com