The U.S. Global Jets ETF (NYSEArca: JETS) tumbled earlier this week following a disappointing fourth-quarter earnings report from United Continental (NYSE: UAL), one of the largest components in JETS. However, some analysts believe the long-term outlook remains for favorable for airline stocks.
The industry is also supported by strong fundamentals with high barriers of entry that makes the sector capitalize on a wide economic moat that has attracted the attention of prominent value investor Warren Buffett.
JETS follows the U.S. Global Jets Index, which uses fundamental screens to select airline companies, with an emphasis on domestic carriers, along with global aircraft manufacturers and airport companies.
Top holdings include American Airlines Group (Nasdaq: AAL), United Continental (NYSE: UAL), Delta Airlines (NYSE: DAL) and Southwest Airlines (NYSE: LUV).
“Southwest, American Airlines, JetBlue and Alaska Air are all set to report Thursday before the opening bell; U.S. airlines are on track for their eighth straight year of profits in 2017. Delta reported quarterly earnings earlier this month, broadly beating Wall Street estimates,” reports CNBC.