The economy may be weakening, but so far no one has told the airline industry.

Instead, August results were generally robust, and the trend has apparently continued into September.

As a result, JPMorgan analyst Jamie Baker expects analysts to continue to increase their profit estimates. "Given the strength in August data this far, third-quarter consensus is likely to begin rising," he wrote in a recent report. "Fourth-quarter consensus may rise as well."

To date, such hope has attracted little buying interest. The Amex Airline Index traded Wednesday at 44.43 and is down around 20% in 2007, after going out last year at 58.29.

The few buyers include Fidelity Investments. In a

Securities and Exchange Commission

filing on Monday, parent company FMR said it boosted its stake in

US Airways

(LCC)

to 13.8 million shares. Fidelity now owns 15% of the carrier's stock outstanding, up from 8.6% in July.

US Airways recently reported that consolidated passenger revenue per available seat mile rose 5% last month. Additionally, "business and leisure demand remains strong," said president Scott Kirby in a prepared statement.

To a degree, a stronger late summer reflects a 2006 slowdown after British authorities said on Aug. 10, 2006, that they had halted a scheme to blow up as many as 10 planes bound for the U.S.

That news resulted in a pullback in international travel, with some spillover into domestic travel, and led to changes in what passengers could carry on board.

At

Frontier

, August passenger RASM rose 9.3%.

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"The strong demand we have seen this summer has carried into September," said CFO Paul Tate, in a prepared statement, noting that the carrier will exceed its earlier earnings guidance.

Also,

Continental

(CAL) - Get Report

said that last month's passenger RASM climbed 6.5% to 7.5%, helped by fuller planes and higher capacity. Two analysts raised their estimates for Continental on Tuesday.

JetBlue

(JBLU) - Get Report

reported the biggest August improvement. It said preliminary passenger revenue per available seat mile jumped 15%. This week, Standard & Poor's removed JetBlue from credit watch and affirmed the carrier's credit ratings, including a "B" corporate credit rating.

S&P said JetBlue has stabilized due to a reduced growth rate, management team additions, and revenue, cost and operational incentives. "JetBlue returned to profitability in the second quarter of 2007 after facing weather-related operational challenges in the first quarter of 2007 and the subsequent replacement of its founder and CEO in May," the agency said in a report.

In another recent report, analyst Susan Donofrio of Cathay Financial said she expects the open skies agreement between the European Union and the U.S., which will take effect next year, to spur consolidation.

"We expect continued fundamental improvements will be the primary driver of the performance of airline stocks, and the possibility of merger activity is an incremental catalyst," she wrote.

Donofrio recommends Continental and

Delta

(DAL) - Get Report

.

Meanwhile, Calyon Securities analyst Ray Neidl said his concerns include seasonality, high oil prices, limited ticket price increases, increased competition, limited enthusiasm for airline stocks and expectations for a slower economy.

"Nonetheless, we do not believe portfolio managers should abandon this sector," wrote Neidl, who recommended selected share buying.