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US Airways Group, Inc. Message Board

  • alanfrombigeasy alanfrombigeasy May 7, 2013 9:33 AM Flag

    LUV quietly growing

    In two ways. One is adding an extra row in it's -700s, 137 143 seats. Almost complete today.

    The other is retiring 137 seat -300s & small -500s and replacing them with more 177 seat -800s.

    In 1Q13, -1 -500, -3 -300s & +9 -800s. LUV should be able to operate a 737-800 for a bit less than a -300.

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    • They revenue is actually falling not growing.

    • LUV certainly has the benefit of past performance and will do well. But how much credit do you give them given the changes in the industry behaviors, and its 27 trailing p/e vs. a 5.5 trailing p/e for LCC ... or even comparing forward p/e's?

      • 1 Reply to wgrsh
      • Kelly is doing an OK job of managing LUV, but it's been abundantly clear for years now that it's best days are over. I'm still not sure that they can make ATL work for them. Without offering lower fares, I suspect most of the "best" customers will prefer DAL, so that hub will be unsuccessful for them. And LUV's overall high costs make them no threat to anybody. Just look at what happened at PHL. LCC just crushed them there; they seem to even be pulling out of most PHL-Florida leisure markets (I'm guessing JetBlue will ultimately replace them there).

        There's just no good reason to be a shareholder of LUV here. They are virtually guaranteed to underperform LCC and other airline stocks.