Airlines

Research evidence excerpt

Airlines

Domestic Airlines - Market Weight

Legacy Airlines - Market Overweight

Airlines May 18, 2026

Model Refresh Ahead of our Transports Conference

The Wolfe Byte

Most of the airlines will be participating in our 19th Annual Global Transportation & Industrials Conference this

week. Ahead of our conference, we're updating our Airline models and include a list of questions to ask each of

the companies in attendance.

●Model Refresh. We're refreshing our airline models today ahead of our transports conference this week. Fuel

prices have leveled off since 1Q reports, so we're not making big changes to our 2Q estimates today. Among the

airlines, DAL and UAL seem to have guided most conservatively on 2Q fuel, while AAL guided more optimistically.

Our updated 2Q EPS estimates are now above Consensus for everyone. Looking past 2Q, we've assumed a further

RASM acceleration in our models in 3Q given commentary about accelerating pricing throughout 2Q. We've also

assumed that fuel prices start to normalize lower based on the forward curve, but we haven't seen this yet. For

now, our updated 3Q EPS estimates are above Consensus for everyone other than JBLU, although our 4Q and

C27 EPS estimates are more mixed relative to current Consensus.

●Key Questions & Themes for Our Conference. While fuel prices have spiked, airlines are seeing very strong

pricing momentum and favorable capacity trends with Spirit’s liquidation. Has pricing continued to accelerate and

is demand still holding strong despite such strong pricing? The TSA data has softened... does this just reflect less

capacity and Spirit, or has demand actually slowed a bit? Looking past 2Q, can RASM accelerate further in 3Q with

a full quarter benefit of higher prices.