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3 Airline Stocks to Buy (and 3 to Hold)

Well, folks, we’re now just two days away from Thanksgiving, which (in my opinion) means that the holiday season is officially upon us. This is one of my favorite times of the year—family get togethers, excellent food, the “holiday spirit” in the air … and for many of us, this is also a time to travel.

I’ve been thinking a lot about airline travel, in particular. There are people who are hesitant to fly after the terrorist attacks in Paris, but there are also people who see flights as a regular part of life—especially when it’s time to see their families for the holidays. So I decided to see how airlines are faring in light of the holiday season and low fuel prices.

The first thing to note is that Major Airlines and Regional Airlines are considered separate industries. To give you an idea, American Airlines (AAL) and Delta (DAL) are classified as Major Airlines, while Southwest Airlines (LUV), JetBlue Airways (JBLU) and Alaska Air Group (ALK) are all Regional Airlines. You’d think that the two industries would show similar results, but according to the Turner Analytics database, Regional Airlines are stronger buys than Major Airlines right now.

Let’s take a closer look at a few of the stocks in the database.

Major Airlines

Ticker Fundamental Score
(out of 100)
Technical Score
(out of 100)
Total Score
(out of 200)
American Airlines, Inc. (AAL) 61 95 156
Spirit Airlines, Inc. (SAVE) 74 65 139
United Continental, Inc. (UAL) 47 10 57

Regional Airlines

Ticker Fundamental Score
(out of 100)
Technical Score
(out of 100)
Total Score
(out of 200)
Ryanair Holdings plc (RYAAY) 69 82 151
JetBlue Airways Corp. (JBLU) 72 78 150
Southwest Airlines Co. (LUV) 67 74 141

What’s causing this difference in airline stocks? One major contributor is the strength of the dollar. Regional Airlines typically have very little international business, which means that they’re impacted less by changes in currency values. Regional Airlines also tend to be low cost—which is a major selling point for consumers on budgets.

Overall, however, airline stocks have the potential to rise over the next few quarters. Low oil prices have helped to widen profit margins for airlines across the board, and many analysts believe that an increase in airline prices—which seems very likely in the upcoming year—will also lead to higher stock prices.

To stay on top of my latest stock rankings, consider subscribing to my Turner Analytics database. And if you aren’t already fully invested and would like handpicked stocks, consider subscribing to Signal Investor.

Sincerely,

Signature

Mike Turner
Turner Trends

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