Latest news with #airlineindustry
Yahoo
a day ago
- Business
- Yahoo
Think Delta Air Lines Is Expensive? This Chart Might Change Your Mind.
Delta Air Lines consistently adds value for its shareholders. The current trading environment heavily favors network airlines over low-cost carriers. Loyalty programs and co-brand credit cards are diversifying Delta's revenue streams. 10 stocks we like better than Delta Air Lines › Investors might not consider Delta Air Lines (NYSE: DAL) stock expensive due to its low price-to-earnings ratio of just over 8 times earnings. Still, some of them do stress over Delta's adjusted net debt of $16.9 billion and the traditional cyclicality of its revenue and earnings. That said, I think the risk is a lot less than in previous years. Here's why. One of the longstanding, and justified, criticisms of the airline industry is that it hasn't generated a return on invested capital (ROIC) sufficient to cover its weighted average cost of capital (WACC). While airlines will all have different WACCs, a rough estimate interpolated from International Air Transport Association (IATA) figures suggests it averages around 8% or 9%. The following chart illustrates a clear bifurcation in the industry over recent years, with Delta and United Airlines' return on invested capital (ROIC) exceeding 8%, significantly ahead of American Airlines and the budget carriers. Moreover, note that the ROIC of Delta, United, and American Airlines is similar both before and after the pandemic lockdown period, while the ROIC of budget airlines has declined. There are many reasons for this bifurcation: Rising labor, airport, and supply chain costs disproportionately hit budget airlines' low-cost and low-margin business models. It's easier for premium airlines to adjust and offer economy seats than it is for budget airlines to "go premium." Delta and other network airlines have substantial loyalty programs and also generate revenue through co-brand credit cards. It all comes together to create an environment where Delta and United are likely to be more resilient in a downturn, particularly against budget airlines, as demonstrated by their ROIC. As such, a lower risk should result in a more favorable risk-reward calculation for Delta, meaning it's not as expensive a stock as many think. Before you buy stock in Delta Air Lines, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Delta Air Lines wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $660,821!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $886,880!* Now, it's worth noting Stock Advisor's total average return is 791% — a market-crushing outperformance compared to 174% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Lee Samaha has no position in any of the stocks mentioned. The Motley Fool recommends Delta Air Lines and Southwest Airlines. The Motley Fool has a disclosure policy. Think Delta Air Lines Is Expensive? This Chart Might Change Your Mind. was originally published by The Motley Fool
CBC
a day ago
- Business
- CBC
Competition watchdog calls for relaxed foreign ownership rules in airline industry report
The Competition Bureau is calling for changes to improve the competitive landscape in Canada's airline industry, including loosening rules that currently limit foreign ownership of Canadian airlines. The watchdog, in a 117-page market study published Thursday, reiterated that Canada's airline industry is highly concentrated with two major carriers — Air Canada and WestJet — dominating the domestic market. Those airlines are competing less directly with each other than they did six years ago, the report said, with WestJet serving fewer domestic fliers at eastern airports, and Air Canada serving fewer domestic fliers at western airports. More competition would lead to lower fares and a higher quality of service, while improved transparency around prices would help travellers make more informed decisions when shopping for flights, the agency said. Canada's existing limits on foreign ownership of airlines are also stifling competition, the watchdog said, and loosening those restrictions will make it easier for newer, smaller airlines to access finances from different sources. It recommended letting foreign companies take full ownership of Canadian airlines that only operate domestically, creating a "new class of airline" that will bring in global expertise and capital. The bureau also suggested letting individual international investors hold a larger share of voting interests in Canadian airlines, boosting the amount from 25 per cent to 49 per cent. John Gradek, a professor of aviation management at McGill University, said there's a price to pay if the government loosens rules around foreign ownership of carriers. "The decisions that are going to be made by those carriers that have a significant influence by foreign [owners] may not be in the best interest of Canadians," he said. Boosting air travel capacity in remote areas The Competition Bureau noted that northern and remote communities face specific difficulties when it comes to air travel because it isn't cost-effective for most airlines to operate in regions serving smaller, more distant populations, and where air travel infrastructure is lacking. Canadians, especially those living in secondary markets, are underserved by the current state of the airline industry, said Gradek, adding that introducing and maintaining services in those markets — at a reasonable price — is a major challenge. "If you live in Sault Ste. Marie, or you live in Medicine Hat, or you live in Yarmouth ... you're in trouble if you want to get on a flight. And it's going to cost you an arm and a leg to get anywhere in Canada," he said. The Competition Bureau is recommending that a national working group be established to focus on air transportation in remote regions. Overall, it made 10 recommendations to improve competition, including: Removing clauses that only let one airport in a local area offer international flights. Improving public access to airline industry data, like information on airline quality. Reviewing how airports are managed and funded. It also suggested limiting the Transport Minister's power to override certain parts of the merger process between airlines. CBC News has reached out to the ministry for a statement. The success of smaller airlines Porter and Flair are improving the playing field, according to the report. Air Canada and WestJet have both faced increased competition from at least one of these smaller carriers since 2019, it said. "However, the history of airline entries and exits suggests that these competitive gains remain fragile, especially during economic shocks," the bureau cautioned. CBC News has contacted WestJet and Air Canada for a response. The issues plaguing Canada's airline industry The Competition Bureau launched its study last July and called on Canadians to contact the agency and share their opinions. Air Canada and WestJet were ordered by a federal court last fall to hand over information for the market study. For years, consumer advocates and industry experts have shared concerns that the airline industry suffers from a serious lack of competition, with some saying that Air Canada and WestJet's dominance amounts to a duopoly. Some travellers have also expressed frustration over the high cost of domestic airfare, with additional fees and surcharges bloating the cost of a ticket beyond the base fare. WATCH | Why is it so expensive to fly within Canada?: Why is it so much more expensive to travel by air in Canada? 1 year ago Duration 1:35 Calgary-based, low-cost airline Lynx Air has ceased operations, citing rising costs among reasons for the closure. McKenzie McMillan, a travel consultant with The Travel Group, tells BC Today host Michelle Eliot that Canadian airlines struggle more than their U.S. counterparts because fewer people travel longer distances between urban areas. And dissatisfied fliers have made a record-number of complaints about the state of air travel in recent years, with the backlog having hit a new peak last spring. Meanwhile, many of the country's smaller discount airlines have folded or filed for bankruptcy — including Lynx Air and Canada JetLines — and newer airlines have failed to take off, such as WestJet-owned Swoop, which was ultimately folded into its parent company's primary operations.
Skift
a day ago
- Business
- Skift
The Resurgence of Virgin Australia
Virgin Australia is headed to an IPO. How did that happen? Our hosts get under the story in this week's episode. Today Jay Shabat is joined by Meghna Maharishi to discuss the recent developments in the airline industry, focusing on Virgin Australia and its turnaround after bankruptcy. They explore the implications of Virgin's IPO, its financial health, and the impact of Qatar Airways' investment. The conversation then shifts to capacity trends for the third quarter, highlighting demand stabilization, fuel price concerns, and growth in various airports worldwide. Listen to This Podcast Apple Podcasts | Spotify | YouTube | RSS Takeaways
Daily Mail
3 days ago
- Business
- Daily Mail
List of best airlines in the world is revealed - and Qantas takes out a surprising spot after a tough few years
Air carrier review website Skytrax has released its list of the world's best airlines. Qantas, Australia's flagship carrier, was named the 14th-best airline in the world. The news may come as a shock to some travellers following several years of bitter backlash against Qantas - including massive government handouts during Covid, unfairly sacking workers and becoming embroiled in political drama after offering politicians placements in the Chairman's Lounge. Skytrax released its ranking on Tuesday with Qatar Airways, Singapore Airlines and Cathay Pacific taking the top three spots. The remaining 10 positions were respectively handed to Emirates, ANA All Nippon Airways, Turkish Airlines, Korean Air, Air France, Japan Airlines and Hainan Airlines. Qantas Airways was ranked 14th - beaten by Swiss Int'l Air Lines in 11th, EVA Air in 12th and British Airways in 13th. Qantas received several other awards from Skytrax including Best Airline in Australia/Pacific. 'To be recognised as the Best Airline Australia and Pacific reflects our ongoing commitment to delivering for our customers and is testament to the exceptional work of our people,' Qantas Group CEO, Vanessa Hudson, said. 'I want to sincerely thank our incredible team of more than 29,000 people around the world, who bring such passion and pride to the work they do every single day. 'This award belongs to them.' In 2024, Qantas was ranked 24th on the world's best airlines list. Qantas again received several 2025 Australia/Pacific awards for its class offerings. Those included Best Economy Class, Best Economy Class Onboard Catering, Best Business Class, Best Business Class Onboard Catering and Best Premium Economy Class. The airline also claimed awards for the Best Cabin Crew in Australia/Pacific and Cleanest Airline in Australia/Pacific. One of the other top Skytrax awards for Australia was handed to Virgin Australia for the Best Airline Staff Service in Australia/Pacific. The carrier was also awarded Best Regional Airline in Australia/Pacific and Most Family Friendly Airline in Australia/Pacific. Virgin Australia was ranked the second-best regional airline in the world. Jetstar also collected two awards from Skytrax in 2025. Those were Best Low-Cost Airline in Australia/Pacific and Best Low-Cost Airline in Australia. Only two awards for the Australia/Pacific region were awarded to non-Australian companies. Those were Best Premium Economy Class Onboard Catering awarded to Air New Zealand and Best Business Class Lounge awarded to Air New Zealand – AKL. The remaining top 20 airlines by Skytrax were Lufthansa, Virgin Atlantic, Saudi Arabian Airlines, STARLUX Airlines, Air Canada and Iberia.
CBS News
11-06-2025
- Business
- CBS News
Silver Airways cancels flights, tells passengers not to go to airport via Instagram
Silver Airways abruptly scuttled all of the Florida regional carrier's flights and told passengers booked on flights scheduled to depart Wednesday not to go to the airport. The bankrupt carrier said in an Instagram post that it would no longer serve customers as of June 11. Silver Airways also said it struck an agreement to sell it assets to a buyer that decided not to continue the carrier's flight operations, part of an effort to restructure the company's debt. The Hollywood/Fort Lauderdale-based airline, which launched in 2011 and which has hubs in Fort Lauderdale, Tampa and Orlando, filed for Chapter 11 bankruptcy in December, saying the move would allow it to raise money and remain competitive. Silver Airways canceled 52 flights Wednesday, according to flight tracking site FlightAware. Industry analysts said they weren't surprised the airline had shut down. "It was more a matter of when, rather than if, Silver would shut down," Atmosphere Research Group airline industry analyst Henry Harteveldt told CBS News. Silver served more than a dozen destinations across Florida, the Bahamas and the Caribbean. It also owned a subsidiary airline, Seaborne, that operated seaplanes flying to the islands of St. Croix and St. Thomas. In its social media post, Silver said it would refund customers' purchases through either their credit card companies or the travel agency through which they booked flights. and contributed to this report.
