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Why JetBlue (JBLU) Is Poised To Beat Earnings This Quarter

JetBlue Airways JBLU is a low-fare, low-cost passenger airline, which provides high-quality customer service, primarily on point-to-point routes, and is based in New York’s John F. Kennedy International Airport. More importantly, the company will release its quarterly earnings report on Tuesday, July 25.

JetBlue currently holds a Zacks Rank #2 (Buy), and the company has surpassed its earnings estimates in nine out of its past ten operational quarters, including a beat last quarter of 4.17%. JetBlue also operates within our Transportation-Airline industry, which currently ranks in the top 2% of the Zacks Industry Rank.

Investors should possess a sense of optimism in the stock when considering its consistency in beating earnings, its Earnings ESP of 5.46%, and its strong Zacks Rank.

If that’s not enough, here are three other reasons why you should be optimistic about JetBlue ahead of its report date:

1.       Strong Style Scores

JetBlue sports impressive style scores, including “A” grades for Value and Momentum, as well as a “B” grade for Growth. For the Value category, JetBlue possesses some impressive metrics that assisted in driving the company to a strong grade. For instance, the company holds an EV/EBITDA of 4.60 and debt/equity of 0.29, both of which compare favorably to the industry averages of 6.17 and 0.69, respectively.

As for growth, the company features current cash flow growth of 12.72% and a net margin of 9.61%, both of which defeat the industry averages of 6.09% and 6.14%, respectively. Finally, JetBlue earned a strong momentum grade due to recent share price movement. In fact, the company’s share price has increased by a whopping 34.08% over its past year of operation.

2.       Impressive Expansion Goals

In May 2017, the company issued an optimistic report on revenue per available seat mile (RASM) for the second quarter of 2017. JetBlue projects RASM to grow at a rate near 4-6%. Also, the carrier said that the future outlook on RASM for the third quarter has been greatly improved since the beginning of the year.

Further, JetBlue is focused on strengthening its presence in major cities and operating at least 70 premium services flights by the end of 2017. The carrier has continued to make an effort to modernize its planes and expand its popular services.

3.       Spectacular Growth in Earnings and Revenue

We expect JetBlue’s growth to continue, as our Zacks Consensus Estimate projects sales of $1.81 billion, which would constitute year-over-year growth of 10.45%. Also, our Zacks Consensus Estimate for earnings calls for EPS of $0.55, which represents 4.19% year-over-year growth. Additionally, in the past 60 days, six out of seven analysts covering the stock increased their earnings estimates for JetBlue, which would benefit the future financial outlook of the security.

Will You Make a Fortune on the Shift to Electric Cars?

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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think. See This Ticker Free >>

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