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Highlights
- While airlines took quite a hit when the pandemic first hit in 2020, things turned for the better amid relaxing public measures earlier this year.
- Some investors looking for long-term gains have been exploring Air Canada (TSX:AC) and WestJet (TSX:ONEX) in the hopes of profit.
- WestJet recently announced that Bob Cummings will rejoin its discount subsidiary Swoop's executive leadership team as President.
While airlines took quite a hit when the pandemic first hit in 2020, things turned for the better amid relaxing public measures earlier this year. In turn, some investors looking for long-term gains began exploring Air Canada (TSX:AC) and WestJet, owned by Onex Corporation (TSX:ONEX), in the hopes of profit due to their active approach and expanded operations.
WestJet recently announced that Bob Cummings will rejoin its discount subsidiary Swoop's executive leadership team as President, effectively from Monday, April 18. This comes as Flair Airlines and Lynx Air, two low-cost carriers, launched their airline operations last week.
In 2018, Mr Cummings served as the President of Swoop and with his return, the ultra-low-cost airline aims to bring more choice, lower fares and certainty to the low-cost carrier market.
So, let's look at the two TSX airline stocks.
Air Canada (TSX: AC)
Air Canada revealed in March that it is buying 26 XLR versions of Airbus A321neo aircraft, with deliveries set to start in Q1 2024 and the final aircraft to be delivered in Q1 2027. The company said that these aircraft will be utilized to expand its fleet and replaced with previous, less-efficient carriers.
On April 18, the Canadian airline revealed that its passenger load surpassed 100,000 customers on April 15 for the first time since the COVID pandemic.
AC stock dropped by nearly seven per cent year-over-year (YoY).
Also read: NUMI and FTRP: 2 TSX psychedelic stocks to buy amid new developments
Onex Corporation (TSX: ONEX)
ONEX's net profit plunged to US$ 214 million in Q4 2021 from US$ 597 million a year ago. Its net income per share amounted to US$ 2.45 in the latest quarter compared to US$ 6.61 apiece in 2020. Its total segment earnings also plummeted to US$ 330 million in Q4 2021, down from US$ 708 million in the same period of 2020.
ONEX scrip plummeted by roughly one per cent in the past one year.
Bottomline
If the market conditions favour, investors can in the long run gain from the above-mentioned stocks as the airlines expand their operations and work on strategies to fight their competition. However, airline stocks can be risky for those with short-term return goals considering COVID and other global factors.
Also read: Which TSX stocks to buy amid rising fears of omicron XE variant?
Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.
