JetBlue Airways Corp. (JBLU) is set to release its fourth-quarter 2013 results before the opening bell on Jan 29, 2014.
In the last quarter, the company delivered a 4.55% negative earnings surprise. Let’s see how things are shaping up for this announcement.
Factors to Influence This Quarter
We believe JetBlue will benefit from growing travel demand, schedule redesigning, cost control measures, optimization of unit revenues, capital expenditure management and disciplined growth. JetBlues’ continued focus on expanding its on-board product and service offerings along with the introduction of cost effective premium service offering – Mint – will drive its ancillary revenues.
Further, the company continues to successfully expand its network footprint in two major growth regions – Boston, and the Caribbean and Latin America. Apart from these the company is also banking heavily on the new services offered from Fort Lauderdale-Hollywood International Airport to different Caribbean and Latin American destinations. However, competitive pressure and increased maintenance cost continue to weigh on the stock.
Earnings Whispers
Our proven model does not conclusively show that JetBlue is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESPand a Zacks Rank #1, 2 or 3 for this to happen. Unfortunately, this is not the case here as elaborated below.
Zacks Rank: JetBlue holds a Zacks Rank #1(Strong Buy).
Zacks ESP: The Most Accurate estimate and the Zacks Consensus Estimate are the same at 13 cents. This results in an earnings ESP of 0.00% for JetBlue and makes surprise prediction difficult for us. So we caution investors against the stock going into the earnings announcement.
Other Stocks to Consider
Here are some other companies to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
Spirit Airlines Inc. (SAVE) with earnings ESP of +2.17% and Zacks Rank #1
Hawaiian Holdings Inc. (HA) with earnings ESP of +5.26% and Zacks Rank #2 (Buy).
Copa Holdings S.A. (CPA) with earnings ESP of +3.91% and Zacks Rank #3 (Hold).
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