“JBLU has risen to the front of the ranks in terms of inbound investor interest. We sense an opportunity,” Analyst Jamie Baker said.
“JetBlue continues to pursue a more returns-oriented strategy with separate fare classes and first-checked-bag fees, which in turn drives healthier margins,” Baker wrote in a note. “We also applaud the JetBlue management team’s willingness to not only participate in industry pricing increases led by other airlines but also to initiate fare increases of its own.”
Meanwhile, Southwest Airlines revealed record earnings in 2016.
“Our total operating revenues reached a record $20.4 billion, with sustained demand for our legendary low fares and superior customer service,” Southwest chairman and CEO Gary Kelly said in a release accompanying the company’s earnings report. “Our profit margins were very strong, and our return on investment capital was a near-record 30 percent.”
The U.S. Global Jets ETF includes a 11.9% tilt toward Southwest and a 3.9% position in JetBlue.
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