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Airline traffic growth is expected to remain solid for 1998 and 1999 along with the US economy, although it will be less than the 5% of 1997, and airline capacity is forecast to grow more slowly than traffic. Airlines are also creating international joint ventures in order to take advantage of the expected increase in international travel. These shares are timely and have outperformed the market in 1997 and 1998, but continue to be cyclical.

Airlines are expected to continue with good profits in 1998 after having a good year in 1997, with rising traffic, firm prices, and the slow rise of airline capacity. International joint ventures have increased for the air transport industry, as international travel outside the US is expectd to grow at a rapid pace, and US airline consolidation is moving ahead, also. Several of these stocks look strong for investors in 1998 and later.

The air transport industry did well financially during 1997, is expected to continue to do well financially during 1998 and higher earnings could be expected until 2002. Capacity grew at a slower pace than traffic which allowed prices to increase. Stocks were strong in 1997 and outperformed the stock market. Overseas markets are expected to increase faster than US markets.

Airline traffic in the US has been strong through July 1997 and is forecast to remain solid through the rest of the year, though slower. Airline load factors have risen to 69.2% for 1997, pricing has risen, and tax changes have been beneficial for carriers, as well. Foreign joint ventures have also become more important to airlines with the expected international market growth. These stocks are cyclical, but are timely for investors in 1997.

The air transport industry has had strong stocks for 1997 as well as an increase in passenger traffic and ticket prices. Higher earnings are expected to be a factor for a major portion of 1997 through 2002. International markets are expected to expand at a faster rate than US markets for several years.

Leveling of capacity helped US airline traffic rise 2% in 1995 and continue at a 6% rate during the first four months of 1996. Airlines in 1995 and the 1st qtr of 1996 also showed profits for the first time since 1989. Airline economics are also being impacted by tax changes, lower commissions for travel agents, and electronic ticketing. Airline profits are expected to be higher in 1996 and 1997, and several stocks are good investments in 1996.

The air transport industry is expected to post improved profits in 1996 and 1997, boding well for at least some of the companies' stocks. The industry made a profit in 1995 for the first time since 1989. Potential investors, however, should be aware of labor conflicts at some of the carriers and of the general cyclical nature of the industry. Air traffic is outpacing capacity, increasing loads and efficiencies. Meanwhile, the impact of reduced airlines commissions to travel agents is not yet known.

The airline load factor rose 2.8% for the first 10 months of 1995, along with a 1.4% capacity increase and a 2.6% rise in traffic. Airlines have shown a profit in 1995 as well, the first since 1989. The new commission structure for travel agents will also save money for airlines, but the low-priced, short-haul service is now more competitive. These stocks will do well in 1996 with higher profits for the year.

Airlines and air cargo companies are more profitable in 1995 due to limited expansion, better cost controls, reduced short-haul competition, and firmer prices. Airline traffic has slowed in 1995 after a 5% increase in 1994. Travel agent commissions for domestic flights are being cut to $50 and $25 for round-trip and one-way flights respectively. These stocks will continue to perform well due to profits in 1995 and 1996.

NEW YORK -- Southwest Airlines lines has saved $20 million to $30 million in travel agency commissions since it launched ticketless travel, chief financial officer Gary Kelly said. That "huge […]