United Airlines Stocks Down on Lower Capacity Outlook

Shares of United Airlines Holdings plummeted in extended trading after it forecasted lower capacity due to the surge of coronavirus cases.

The Chicago-based company shed 1.94% or 0.86 points to $43.54 per share. It trailed its drop of 2.65% or 1.21 points to $44.40 per share in the regular-hours session.

Accordingly, it outperformed the market since the start of 2022 as it posted a decline of 2.40% or 1.09 points year-to-date.

Still, it stands as one of the major American carriers with a market value of $14.38 billion.

United Airlines projected that its first-quarter capacity would fall between 16.00% and 18.00%, below the same period in 2019.

Then, it expects that the revenue growth will decrease by 20.00% to 25.00% from three years earlier.

The company slashed its 2022 growth forecast as it noted that it would fly less this year than pre-pandemic levels.

It started the year with a scaled-back schedule because of the Omicron-driven spike of Covid-19 infections.

Moreover, United Airlines scrapped its plan to elevate capacity by 5.00%. Then, it estimated that Q1 costs would hike by 15.00%.

United Airlines Earnings Beat Estimates

United Airlines also posted better-than-expected fourth-quarter earnings late Wednesday. Nevertheless, investors focused on the downbeat Q1 forecasts.

The carrier mentioned that bookings for spring and summer are strong, driving up the positive figures.

Correspondingly, its Q4 total revenue strengthened to 8.19 billion, outpacing the expected $7.97 billion.

At the same time, it posted a narrower loss of $1.60 from the average analysts’ estimate of $2.11.

Meanwhile, its US rivals also declined in the after-hours trading.

For instance, Delta Air Lines Inc. edged down 0.54% or 0.21 points to $38.61 per share.

Like United Airlines, Delta cited that the Omicron variant dented its bookings this year, flagging a higher Q1 loss.

Consequently, Southwest Airlines Co. curtailed 0.18% or 0.08 points to $44.35 per share.

Similarly, American Airlines slashed 0.29% or 0.05 points to $17.26 per share.

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