When we invest in the airline industry, we see that it has finally been able to right size itself and deliver somewhat decent service. Anyone who travels internationally will tell you that the services provided by all carriers (foreign & domestic) are generally better than what they experience on domestic flights. We are hopeful that the quality gap will close over time.
Airline travel, as an industry, has become sustainably profitable and for the first time in the industry's history, it is able to pay investors a fair return on their capital. This has generally made airline stocks a decent investment. Those who follow our work know that United Continental (UAL) is generally our favored domestic global carrier and Southwest Airlines (LUV) has been our favored regional carrier.
