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United Airlines' (UAL) Q1 Revenue View Weaker Than Expected

United Airlines Holdings Inc UAL updated its guidance for first-quarter 2021.

Per a SEC filing, the airline anticipates its first-quarter revenues to decline 66% from first-quarter 2019 to $3.2 billion due to coronavirus-led suppressed air-travel demand. While the forecast lies in the “favorable end” of the previously guided range of a decrease of 65-70%, it falls short of the Zacks Consensus Estimate of $3.32 billion. This lower-than-expected view weighed on investor sentiments, causing shares of the company to decline close to 4% at the close of business on Apr 12.

However, on a positive note, the carrier has witnessed acceleration in customer demand for travel and new bookings in March, owing to which it generated positive average daily core cash flow in the month. The company expects to generate positive average daily core cash flow going forward as well. As a matter of fact, U.S. airlines have lately been seeing an improvement in travel demand with more Americans getting vaccinated and coronavirus-led restrictions easing.

For the first quarter, United Airlines estimates average daily core cash burn to be approximately $9 million per day, an improvement of about $10 million per day from that reported in the fourth quarter of 2020. The company is set to report first-quarter results on Apr 19.

Zacks Rank & Key Picks

United Airlines carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are Navios Maritime Partners LP NMM, Landstar System, Inc. LSTR and Marten Transport, Ltd. MRTN, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Shares of Navios Maritime Partners, Landstar System and Marten Transport have rallied more than 200%, 68% and 25% in a year’s time, respectively.

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United Airlines Holdings Inc (UAL): Free Stock Analysis Report
 
Marten Transport, Ltd. (MRTN): Free Stock Analysis Report
 
Landstar System, Inc. (LSTR): Free Stock Analysis Report
 
Navios Maritime Partners LP (NMM): Free Stock Analysis Report
 
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