Airlines in Transition: The Most Vulnerable Players

Editor's note: This was originally published on RealMoney earlier this month. With the Delta-Northwest merger back in the news, it is being republished as a bonus for TheStreet.com readers.

For much of the last two decades, airlines have consumed massive amounts of capital. Yet that cash no longer sits on their balance sheets, thanks to a nearly uninterrupted string of operating losses.

As a result, the carriers have continually looked to replenish their coffers, through a combination of fresh debt and equity. These carriers are making the rounds again, hat in hand, and praying that the current hurricane season spares the Gulf Coast oil complex.

Simply put, any new spike in oil will make it harder to pull off equity or debt deals on favorable terms. But if oil falls toward $100, fresh financing should be quite easy to accomplish. ...