Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • Angel Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
Login My Member Benefits Archives Research Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • Angel Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    ×
  • Subscribe
Enter stock ticker or keyword
×
5 Ways to Beat the Fed (and Crush Inflation)
Twitter
Tags: stocks
Stocks: HA

This Airline Stock Is a "Must Own" This Holiday Season - and It Could Double

By Jamie Dlugosch, Guest Writer, Money Morning • November 29, 2018

Start the conversation

Comment on This Story Click here to cancel reply.

Or to contact Money Morning Customer Service, click here.

Your email address will not be published. Required fields are marked *

Some HTML is OK

airline stockWho doesn't love Steve Martin in "Planes, Trains & Automobiles"?

The buddy travel movie from the 1980s remains a classic.

You can also make money - big money - following the major investment theme prevalent in the film that still resonates today.

The entire premise of the movie is capitalism.

The main characters begin in New York, working their various trades.

Then it's off to the airport trying to get home.

The plane is packed, and weather diverts the flight.

On and on it goes, and throughout the entire journey, we see commerce, commerce, and more commerce.

With all that commerce comes profits and higher stock prices.

Rinse, wash, and repeat.

"Federal Rent Checks": Thanks to an obscure law, over 100 government agencies are required to pay rent. By following a simple investment strategy, you could receive checks of up to $1,795 every month. Read more...

The 2018 travel season is no different. And that has made the airline stock we're bringing you today a virtual "must own."

Planes are packed, and so too are all other modes of transport.

I was on my own road trip recently, and I cannot remember a time when I saw more freight hauled by trucks.

Sign up for SMS so you never miss special events, exclusive offers, and weekly bonus trades.

It was almost as if cars did not belong on the freeway, lest we get in the way of capitalism.

Yes indeed, the economy is humming at a hot clip.

And while many investors look to the big names in the industry like Boeing Co. (NYSE: BA), that company has run into some recent troubles.

Since early November, the giant plane maker has dipped more than 10% after revelations about software glitches that may have contributed to a plane crash in Indonesia. Tragic disclosures like these have a way of lasting far longer than a 30-day sell-off followed by recovery.

The airline industry has had an impeccable track record with respect to safety. Any cracks in the system will likely result in a decay in trust that will have to be repaired.

While the current issue with Boeing will not derail future earnings, the issue may very well delay profits, and that is a big deal for the stock.

At current prices, Boeing trades for 21 times current-year estimated earnings that are now forecast to grow by 20%.

The valuation without any safety issues is on the high end, considering Boeing is an industrial company, not a technology growth stock.

It's even more expensive should earnings get pushed down the road as trust is rebuilt with Boeing stakeholders.

On the flip side of Boeing are the aircraft carriers where planes are full and fees are rising.

Those are the businesses I want to own in any market.

Recently, a discount airline bumped its forecast for a key metric in the industry - revenue per available seat mile - from 6% to 11%.

That's a near doubling of expectations.

Has there been a commensurate increase in share price?

Not quite.

While airline stocks have performed well during the recent sell-off in stocks, that performance has not mirrored actual performance of the airlines in their day-to-day business.

Thus from a valuation standpoint, investors should be licking their chops when it comes to owning airline stocks.

Even better, there were minimal if any disruptions in air travel during the vital Thanksgiving weekend.

Given that most analysts factor in some sort of weather disruption, actual revenue numbers are likely to be even higher than what many expect today.

From a PEG perspective, the airline industry is chock full of opportunity.

Some better than others.

Forget the name of the company for a minute, and just focus on the numbers.

The average price/earnings ratio for a stock, any stock, historically is about 15 times.

How would you like to pay 17 times, but for a stock that is growing earnings at a rate of 40% next year?

I suspect you would take that deal all day long. And that's exactly the case with the airline stock to buy we're bringing you today...

This Airline Stock Is an Absolute Steal This Holiday Season

Join the conversation. Click here to jump to comments…

Login
guest
guest
0 Comments
Inline Feedbacks
View all comments


Latest News

May 27, 2023 • By Garrett Baldwin

postcards from the florida republic - may 27

May 26, 2023 • By Garrett Baldwin

Here's Your (Surprising) Best Bet in a U.S. Default

May 26, 2023 • By Shah Gilani

earnings
The Five Things You Need to Know Before Buying Any Stock
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Profit Takeover This Is VWAP Penny Hawk Trading Today Midday Momentum Pump Up the Close
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Night Trader Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Extreme Profit Hunters Profit Revolution Warlock's World Quantum Data Profits Live Trading Alliance Trade The Close Inside Money Trader Expiration Trader Flashpoint Trader Darknet Hyper Momentum Trader Alpha Accelerators Weekly Profit Cycles Brutus Alerts Resource Traders Alliance

Ā© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz