Where the Airline Industry Could Be Headed

Where the Airline Industry Could Be Headed

Posted On April 16, 2019 1:42 pm

United Airlines (UAL) is set to report earnings after the close today. But, it didn’t wait for the event to announce it is suspending flights of Boeing’s 737 max through the summer.  It joins American and Southwest in halting the use of the plane involved in two recent crashes.  

So what can we expect from not just United, but the entire airlines sector, which has been buffeted with concerns ranging from overcapacity, the grounding of Boeing’s (BA) 737 Max and rising fuel costs over the next few months.

Warren Buffet once famously swore that he’d never invest in airlines, believing it was a flawed business model. But, in 2015, he changed his mind and allowed his firm Berkshire Hathaway to take large stakes in several of the major carriers such as American Airlines (AAL)United Continental Holding (UAL), Southwest Airlines (LUV) and Delta Air Lines (DAL).

So what…

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About author

Steve Smith

Steve Smith have been involved in all facets of the investment industry in a variety of roles ranging from speculator, educator, manager and advisor. This has taken him from the trading floors of Chicago to hedge funds on Wall Street to the world online. From 1987 to 1996, he served as a market maker at the Chicago Board of Options Exchange (CBOE) and Chicago Board of Trade (CBOT). From 1997 to 2007, he was a Senior Columnist and Managing Editor for TheStreet.com, handling their Option Alert and Short Report newsletters. The Option Alert was awarded the MIN “best business newsletter” in 2006. From 2009 to 2013, Smith was a Senior Columnist and Managing Editor for Minyanville’s OptionSmith newsletter, as well as a Risk Manager Consultant for New Vernon Capital LLC. Smith acted as an advisor to build models and option strategies to reduce portfolio exposure and enhance returns for the four main funds. Since 2015, he has worked for Adam Mesh Trading Group. There, he has managed Options360 and Earning 360, been co-leader of Option Academy, and contributed to The Option Specialist website.