3 Top Airline Stocks To Buy For A Post Pandemic-World

NYSE: LUV | Southwest Airlines Company  News, Ratings, and Charts

If you have been avoiding the airline stocks since the pandemic started in the spring, you are not alone. The airlines have been risky plays due to diminished travel levels. Further, travel should remain depressed especially in the winter months.

However, it appears as though it is now safe to invest in airlines. A vaccine is available to combat the virus, possibly setting the stage for a return to normalcy at some point in 2021.

If society returns to normal, air travel will gradually move back toward pre-pandemic levels, helping the following stocks move higher: Southwest Airlines Company (LUV), China Southern Airlines Company (ZNH), and Allegiant Travel Company (ALGT).

Southwest Airlines Company (LUV - Get Rating)

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As the largest domestic airline in the United States, LUV has enjoyed a competitive advantage over other airlines that are more dependent on international travel. LUV’s fortunes will improve all the more after a coronavirus vaccine is administered to the public. The pent-up demand for travel will likely help LUV set records for passenger numbers and revenue in a couple of years following the pandemic’s end.

If you are still hesitant to invest in LUV, consider the fact that the stock has “B” grades in the Peer Grade and Trade Grade POWR Rating components. LUV is ranked third of more than 20 publicly traded airline companies. The top analysts insist LUV is fairly priced at $49.33, meaning it has more than a 3% upside. However, once it appears as though air travel is returning to normal, there is a good chance LUV will spike even more.

Look for LUV to move back toward its pre-virus price level of $55 to $60 in the months ahead.

China Southern Airlines Company (ZNH - Get Rating)

Renewed confidence in the global economy and the safety of air travel will help airline stocks both here at home and also abroad. ZNH, one of China’s top air transportation companies, will benefit from the spike in travel. It is worth noting ZNH is a 60% shareholder in Zhuhai, Guangxi, Shantou, and Xiamen regional airlines.

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