Analyzing JetBlue Airways Corporation (JBLU) & United Continental Holdings (UAL)
JetBlue Airways Corporation (NASDAQ: JBLU) and United Continental Holdings (NYSE:UAL) are both mid-cap transportation companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.
This table compares JetBlue Airways Corporation and United Continental Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|JetBlue Airways Corporation||9.78%||16.75%||6.99%|
|United Continental Holdings||6.09%||29.46%||6.17%|
Earnings & Valuation
This table compares JetBlue Airways Corporation and United Continental Holdings’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|JetBlue Airways Corporation||$6.82 billion||1.03||$1.54 billion||$1.97||10.89|
|United Continental Holdings||$37.38 billion||0.53||$6.37 billion||$7.23||9.02|
United Continental Holdings has higher revenue and earnings than JetBlue Airways Corporation. United Continental Holdings is trading at a lower price-to-earnings ratio than JetBlue Airways Corporation, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
84.8% of JetBlue Airways Corporation shares are owned by institutional investors. Comparatively, 98.5% of United Continental Holdings shares are owned by institutional investors. 0.6% of JetBlue Airways Corporation shares are owned by company insiders. Comparatively, 0.3% of United Continental Holdings shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
This is a breakdown of recent recommendations and price targets for JetBlue Airways Corporation and United Continental Holdings, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|JetBlue Airways Corporation||1||8||4||0||2.23|
|United Continental Holdings||0||8||7||0||2.47|
JetBlue Airways Corporation presently has a consensus target price of $25.70, suggesting a potential upside of 19.76%. United Continental Holdings has a consensus target price of $84.92, suggesting a potential upside of 30.17%. Given United Continental Holdings’ stronger consensus rating and higher probable upside, analysts clearly believe United Continental Holdings is more favorable than JetBlue Airways Corporation.
Volatility & Risk
JetBlue Airways Corporation has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500. Comparatively, United Continental Holdings has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.
United Continental Holdings beats JetBlue Airways Corporation on 9 of the 14 factors compared between the two stocks.
About JetBlue Airways Corporation
JetBlue Airways Corporation is a passenger carrier company. The Company provides air transportation services across the United States, the Caribbean and Latin America. Its segments include Domestic, and Caribbean & Latin America. It operates various kinds of aircrafts, including Airbus A321, Airbus A320 and Embraer E190. It also provides premium transcontinental product called Mint. As of December 31, 2016, Mint included 16 fully lie-flat seats, four of which were in suites with a privacy door. The Company also provides Fly-Fi in-flight Internet service across its Airbus fleet. It provides its customers a choice to purchase tickets from three branded fares, which include Blue, Blue Plus and Blue Flex. Each of these fare include different offerings, such as free checked bags, reduced change fees and additional TrueBlue points. As of December 31, 2016, its Airbus A321 aircraft in a single cabin layout had 200 seats and those with Mint premium service had a seating capacity of 159 seats.
About United Continental Holdings
United Continental Holdings, Inc. (UAL) is a holding company and its principal subsidiary is United Air Lines, Inc. (United). The Company transports people and cargo through its mainline operations. It has global air rights in North America, Asia-Pacific, Europe, Middle East, Africa and Latin America. The Company, through United and its regional carriers, operates flights from its hubs at Newark Liberty International Airport (Newark Liberty), Chicago O’Hare International Airport (Chicago O’Hare), Denver International Airport (Denver), George Bush Intercontinental Airport (Houston Bush), Los Angeles International Airport (LAX), A.B. Won Pat International Airport (Guam), San Francisco International Airport (SFO) and Washington Dulles International Airport (Washington Dulles). It has contractual relationships with regional carriers to provide regional jet and turboprop service branded as United Express. These regional operations are an extension of the Company’s mainline network.
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