Top Takes From RealMoney

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5. Airlines
By Tim Melvin
1:25 p.m. EDT

Giovanni Bisignani, IATA's director general and CEO, said at the annual meeting of that organization that global airline revenue was expected to drop by over $80 billion this year. Even after factoring in a $59 billion drop in aggregate fuel costs, the world's airlines will lose a collective $9 billion in 2009.

While debt at the world's airlines is at an all-time high of $170 billion, cash is just 13% of revenues. Bisignani warned that an extended recession could lead to a severe cash crisis for the airline industry. He estimated that it could take as much as $1 trillion to restructure airline companies around the planet.

Well-financed airlines like Southwest (LUV Quote) should benefit from the turmoil in the industry. The $2.1 billion of cash on the books should put them in a very strong competitive position. I remain long the stock.

Long LUV.

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