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Copa Holdings' December Traffic Rises, Load Factor Down

Zacks Equity Research

Copa Holdings, S.A. CPA posted mixed traffic numbers for December 2018. Load factor (percentage of seats filled by passengers) declined as traffic growth was outpaced by capacity expansion.

Consolidated traffic (measured in revenue passenger miles or RPMs) came in at 1.9 billion, up 5.3% from the year-ago figure. On a year-over-year basis, consolidated capacity (or available seat miles/ASMs) rose 6% to 2.3 billion. However, consolidated load factor contracted 0.5 percentage points (pp) to 82.1%.

For 2018, Copa Holdings generated RPMs of 21.5 billion (up 8.1% year over year) and ASMs of 25.8 billion (up 7.9% year over year). Consequently, load factor registered a rise of 0.2 pp year over year to 83.4%.

Copa Holdings, S.A. Price


Copa Holdings, S.A. Price | Copa Holdings, S.A. Quote

In spite of the increase in December traffic, the carrier has its own share of challenges. Despite the current downtrend in oil prices, fuel costs are expected to hurt bottom-line growth in the final quarter of 2018. Escalating operating expenses are also expected to dent the bottom line. Currency devaluation in certain Latin American economies is an added challenge for Copa Holdings.

Zacks Rank & Stocks to Consider

Copa Holdings carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the Zacks Airline industry are Spirit Airlines, Inc. SAVE, Azul S.A. AZUL and Allegiant Travel Company ALGT. While Allegiant carries a Zacks Rank #2 (Buy), Spirit Airlines and Azul sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Spirit Airlines and Azul have gained 42.5% and 49.6% in the past six months, respectively. Meanwhile, Allegiant outpaced the Zacks Consensus Estimate in three of the trailing four quarters, the average being 18.7%.

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Spirit Airlines, Inc. (SAVE) : Free Stock Analysis Report
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