Business Report: How United Airlines scared the stock market - Hawaii News Now - KGMB and KHNL

Business Report: How United Airlines scared the stock market

Image: Hawaii News Now Image: Hawaii News Now
HONOLULU (HawaiiNewsNow) -

United stock is down 2 points despite reporting much higher revenues and profits. Southwest Airlines is also down 2 points. American and Delta are down by smaller amounts, and Hawaiian is down fractionally. And why is that?

United scared stock traders by announcing plans to aggressive expand capacity - more flights, more seats, 4% to 6% more seats, enough to maybe trigger a fare war. Analysts, frantically scribbling on their napkins, concluded that, all other things being equal, per share profits at all these airlines could fall 4%.

The real scare is that all things won't be equal. What if some airlines hold onto their market share but the stock YOU hold loses more than 4% of its per share earnings? So that's why lower fares, which would be good for consumers, have given the market the vapors.

Copyright 2018. Hawaii News Now. All Rights Reserved.

Powered by Frankly