Alaska Air Group (ALK), the holding company of Alaska Airlines, has had a fruitful 2014 like many of its peers in the airline space. The carrier attained a 52-week high of $60.94 on the last trading day of the year. The stock cooled off a little ending the Dec 31 session at $59.76.
Shares of this Zacks Rank #2 (Buy) company have surged by over 60% in 2014. The bullish run is expected to continue in 2015 as well. The company had delivered better-than-expected earnings in the third quarter of 2014. With that, the company outperformed the Zacks Consensus Estimate for the fourth consecutive quarter, with the average positive earnings surprise coming in at 5.1%.
Consequently, estimates for 2015 are on the rise. The Zacks Consensus Estimate for 2015 currently stands at $5.15 per share, up 25.78% from the estimated 2014 figure ($4.09).
The company also received favorable news on the labor front in the final month of the year with the flight attendants of Alaska Airlines approving a 5-year labor contract. The contract has been ratified following 3 years of negotiations between the flight attendants and management (read more: Alaska Airlines Crew Approve 5-Year Labor Contract).
We are also encouraged by the expansion efforts of this Seattle, WA-based company. Alaska Airlines recently announced a customer friendly move, applicable for the entire month of January. The carrier announced that members of its award winning frequent flier program – Alaska Airlines Mileage Plan – will be able to have one of their bags checked in for free. The carrier further stated that in January, even non-mileage plan members can sign up for the program online (without incurring any additional cost), ahead of their trip or even at the airport prior to getting their bags checked.
We believe that Alaska Air Group will continue its impressive performance in 2015, riding high on the favorable conditions prevailing in the airline industry courtesy weak oil prices.
Zacks Rank
Some other stocks worth reckoning in the airline space are Delta Air Lines, Inc. (DAL), American Airlines Group Inc. (AAL) and JetBlue Airways Corp. (JBLU). All the three stocks sport a Zacks Rank #1 (Strong Buy).
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