I like to look at Wall Street as a living, breathing thing.
It’s always changing, it can be unpredictable at times, yet it also follows patterns if you know how to analyze it, and it tries to keep itself balanced.
Right now one section of Wall Street is at a recent low point, but the market’s affinity for that balance could mean this particular section is preparing to soar…
For bargain hunters, this could be the most appetizing article I write all year. That’s because, if everything unfolds as it should, there’s a particular industry of the stock market that could be ready to jump up as high as 50%, according to some insiders.
And if that is meant to be, then the stocks in this section of the market are currently among the best bargain buys of the year!
So which industry am I talking about?
The U.S. airline industry.
Before I get started explaining where this industry is currently at, how it got there, and why it could soon skyrocket, here are the four big U.S. airline stocks:
- Delta Airlines (DAL)
- Southwest Airlines (LUV)
- American Airlines Group (AAL)
- United Continental Holdings (UAL)
Very soon, those four stocks could be on the move.
Now, this industry has been dipping since the beginning of the year. As an example, LUV has fallen from $47 per share in January to $34 just days ago- that’s a 27% drop!
But now LUV and the others could be preparing to rise back up to their early-in-the-year highs or even jump right past them.
Why?
The main reason spurring everything else on is the fact that the U.S. price for jet fuel is down to $1.70 a gallon, which is a 40% free-fall in a year. And jet fuel just so happens to be the biggest operating expense for airline companies.
That has changed the outlook drastically for the big 4 U.S. airline stocks, which control roughly 75% of the domestic market.
In June of last year, Wall Street pros predicted that U.S. airlines would grow their combined earnings in 2015 by about 7%. Now, those predictions have jumped to about 40%.
However, shares for those collective stocks have dipped over 20% this year, and are going for less than half the valuation of the S&P 500 index.
So is it time to go all in on U.S. airline stocks?
While things look awfully appealing for the big four (and others like JetBlue), I’m not prepared to throw everything I have at them. Instead, I’m waiting for those stocks to prove to me that they’re done falling.
It’s all about timing in the stock market, and timing these investments correctly could mean huge gains.
Luckily, we specialize in timing, and U.S. airline stocks are one of the focuses of Midas Premium at the moment.
