CNBC’s Jim Cramer on Monday offered two airline stocks he thinks investors should add to their portfolios.
“There’s always a bull market somewhere, and right now it’s flying at 30,000 feet. My favorites are the two most profitable, ie [Delta Air Lines] and [Alaska Air Group]. Just remember to call the cashier little by little on your way up because remember these are airlines. They tend to be a very booming and struggling industry,” the Mad Money host said.
Delta shares fell 0.96% on Monday, while Alaska shares slipped 0.19%.
Delta said earlier this month that it expects unit revenue to increase double-digits in the second quarter compared to pre-pandemic levels three years ago. The company also expects total sales to recover by up to 97% from 2019 levels
Chief Executive Ed Bastian said on Squawk Box following the company’s latest quarterly results that the airline saw its highest monthly revenue in terms of bookings in March and that this trend is continuing into April.
“I’m still stunned,” Cramer said of Bastian’s comments.
Alaska set a sales record in March but cut its schedule by 2% through the end of June due to a pilot shortage.
“While they’re not in the majors, they’re still very well run, with a much higher mix of leisure travelers than business travelers,” Cramer said.
“The only problem with this stock is that everyone knows Alaska Air is one of the strongest players in the industry, making it difficult for them to surprise on the upside. So the stock is actually a couple of dollars down from the previous quarter,” he added.
Cramer said that despite a bull market in airlines, there are some companies whose stocks investors should avoid.
“I would stay away from the companies involved in the Spirit Airlines bidding war — that’s JetBlue, Frontier and Spirit itself,” he said.
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