Regional airlines such as American
Airline stock are engaged in the provision of air travel service to those
areas where they may not be enough demand for a mainline airline to provide a
service. The regional airlines industry either operates as an affiliated
airline operating under the brand name of a famous industry or as independent
airlines with its own brand name. The regional airlines industry also extends
its services of air travel to small and considerably aloof communities.
Financial analysis of the industry has revealed the price to earnings
ratio of 31.2. The net profit margin is 3.5%. The return on equity is 8.5%
while the dividend yield is 0.9%. The regional industry has recently faced a
problem regarding the shortages of pilots for its flights. This shortage has
resulted due to the high cost of the completion of training programs and the
low initial salary that is offered to these new recruits. This discourages new
recruits from applying for this specific occupation and leads to difficulties
for the regional airlines industry. As a result of these hiring difficulties
the firms in the industry are finding it difficult to compete. The
salary at regional airlines for first officers starts at $22,400, which is
quite less as compared to the salaries of other important airline staff. The
test engineer earns a salary of $52,500 per month and the Air Force second
lieutenant earns a salary of $53,616 per month, which is quite higher than that
of the pilot. Due to this stark contrast, the frequency and speed of hiring has
remained unsatisfactory. A report has indicated that 11 out of 12 regional
airlines have been unable to meet their hiring targets in the previous year.
The regional industry
is not a very large one. The number of airlines operating within the industry is
not too massive either. The largest revenue in the regional airlines industry
is obtained by Southwest Airlines Company, which stands at a decent $16.9 billion.
The market follower in terms of revenue is LATAM Airlines Group, which has revenue
of $8.2 billion. The third position is occupied by Alaska Air Group with revenue
of $6.7 billion. Copa Holdings and JetBlue Airways Corporation occupy the
fourth and fifth position, which have revenue of $6.2 billion and $2.5 billion
respectively.
The stock price
analysis of these firms has revealed that the highest stock price is that of
Copa Holdings which is quoted at $136.71.
The second highest stock price is of Alaska Air Group, which stands at $95.61.
The third highest stock price is of the market leader Southwest airlines, which
is quoted at $24.61 while the fourth place is held by LATAM airlines having a
stock price of $14.84. The lowest stock price among the firms is of Jet Blue
Airways, which has a disappointing stock price of $8.68. The current composite
value of the industry’s stock stood at $1260.7 and depicted an average change
of 0.22%. More relevant and authentic information about the industry can be
obtained from Bidnessetc.com.
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