SOURCE: The Bedford Report

The Bedford Report

November 25, 2010 11:25 ET

Despite Rising Fuel Costs Regional Airlines Look Poised to Take Off

The Bedford Report Provides Analyst Research on Southwest Airlines & SkyWest

NEW YORK, NY--(Marketwire - November 25, 2010) - The Airline industry has performed well as of late, with many companies reporting a speedy return to profitability after last year's losses. The airlines are benefiting from a return in travel demand amid an industry wide effort to keep capacity from growing too fast. Going forward analysts expect airlines overall to further cement their turnaround despite rising fuel prices and an uncertain U.S. economy. The Bedford Report examines the outlook for companies in the Regional Airlines Industry and provides research reports on Southwest Airlines Co. (NYSE: LUV) and SkyWest, Inc. (NASDAQ: SKYW). Access to the full company reports can be found at:

www.bedfordreport.com/2010-11-LUV

www.bedfordreport.com/2010-11-SKYW

Many investors avoid airline stocks due to concerns about higher fuel prices. Following this month's "QE2" announcement, one of the bigger concerns is that the already weak US dollar may become even weaker. When the greenback performs poorly against other currencies, crude oil tends to go up due to its relatively inverse relationship with the US dollar.

Many Airlines protect themselves from spiking fuel charges via "fuel hedging." A fuel hedge contract commits an airline to paying a pre-determined price for future fuel purchases. Airlines enter into these contracts assuming that future fuel prices will be higher than current prices.

The Bedford Report releases regular market updates on the Major Airline Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at www.bedfordreport.com and get exclusive access to our numerous analyst reports and industry newsletters.

To be clear, there are some dangers with fuel hedging, and today, most airlines take a somewhat cautious approach following catastrophic losses from hedging in 2008 when oil prices spiked and then came crashing down.

One of the few fuel hedge success stories in 2008 was Southwest Airlines. Southwest saved about $1.3 billion dollars from its hedging program in 2008, but the company has tempered its involvement since then. The company's CFO Laura Write says Southwest has "lessened our hedging primarily because we felt energy prices were going to be under downward pressure between 2010 and 2011."

The Bedford Report provides Analyst Research focused on equities that offer growth opportunities, value, and strong potential return. We strive to provide the most up-to-date market activities. We constantly create research reports and newsletters for our members. The Bedford Report has not been compensated by any of the above-mentioned publicly traded companies. The Bedford Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at http://www.bedfordreport.com/disclaimer

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