JetBlue Airways Corporation (JBLU), Copa Holdings, S.A. (CPA): Airlines Ready to Capitalize on Recent Expansion

A niche carrier awaiting a turnaround

Hawaiian Holdings, Inc. (NASDAQ:HA) is embarking on a spring quarter where it may well experience a rebound in performance. This is after suffering under excess seating capacity and competition on certain routes, factors that forced it to discount fares and fly unprofitable routes. A strengthening of the dollar against the yen has also hampered profits. Nevertheless, looking to the second half of 2013, capacity cuts should help to lift airfares and stabilize results.

Hawaiian will continue to expand, launching service to the likes of New Zealand and Taipei this year. It is building its fleet and plans to boost seating 4% to 5% annually in the second half of this decade. This is a considerable decrease from the 22% jump last year, and efficiency may well improve accordingly.

Summary

These are probably not the three airlines that first jump to mind as investments. For some other small airline stocks to consider, read my March 4 blog. The premise behind purchasing these stocks is that a softening of capacity growth will allow for improved productivity, bolstering earnings. JetBlue Airways Corporation (NASDAQ:JBLU) and Copa Holdings, S.A. (NYSE:CPA) look positioned for good times ahead, while Hawaiian Holdings, Inc. (NASDAQ:HA) may be more of a long-term story. In all, risk-tolerant investors may want to add one or two airlines to their portfolio.

The article Airlines Ready to Capitalize on Recent Expansion originally appeared on Fool.com and is written by Damon Churchwell.

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