Sao Paulo-based airline Azul SA  (AZUL) - Get Report on Monday became the latest carrier to highlight the improvement in Latin America's economy, even though CEO David Neeleman declared, "Brazil still hasn't recovered."

"While you haven't seen a recovery yet, you're seeing stability," Neeleman said on the carrier's second quarter earnings call. "We're seeing stable bookings."

Azul shares closed Monday at $25.68, up 1%. Shares have gained 27% from its April IPO price. Meanwhile, shares in Brazilian carrier Gol Linhas Aereas Inteligentes SA have gained 124% year-to-date while shares in Chilean carrier Latam Airlines Group SA have gained 45%.

Shares in Panama City-based Copa Holdings SA (CPA) - Get Report  were the big winner in the group on Monday, rising 3%. Copa reported earnings last week: its shares are up 37% year-to-date.

Additionally, shares in American Airlines Group Inc.  (AAL) - Get Report , the biggest U.S. carrier in Latin American, gained 1% on Monday, as did peers Delta Air Lines Inc. and United Continental Holdings Inc.

  • An Airline Fare War Has Broken Out

As for Azul, the airline watched revenue rise 19% in the second quarter while the carrier narrowed its loss by 72% to about $10 million. Buckingham Research analyst Dan McKenzie has a buy rating and a $33 target price. China's Hainan Airlines owns 24% of Azul, while United Continental Holdings Inc. (UAL) - Get Report owns 5%.

"Azul is a multi-year pre-tax earnings improvement story on industry capacity that has been sharply restructured in Brazil over the past 3 years," McKenzie wrote Monday. Shares represent "compelling value in the context of the carrier's multi-year pre-tax earnings growth story," he said.

On American's second quarter earnings call in July. President Robert Isom said Latin America region passenger revenue per available seat mile gained 15% in the second quarter.

American shares are up 5% year-to-date. The carrier's Miami hub provides a unique ability to serve Central and South America.

In the current quarter, "We think Latin America will again be our best-performing entity with performance in line with the first quarter," Isom said. "We expect positive Latin year-over-year performance for the remainder of 2017."

As for Copa, the carrier reported on August 9 that its second quarter operating margin was 14.4%, and it raised current quarter margin guidance to between 16% and 18%.

"The company's consistent profitability and margin expansion are a testament to the strength of their business model, and underpin our belief that profitability and earnings growth will continue," wrote Deutsche Bank analyst Mike Linenberg, who has a buy rating and a $137 price target.

Linenberg also wrote that GOL, which reported second quarter earnings on August 10, "eked out a small operating profit for its June quarter, which is typically the company's seasonally weakest quarter (it includes the start of winter for countries in the southern hemisphere).

"The airline's 1.7% operating margin was its first in the 'black' since 2010 and roughly 900 bps better than a year ago as the economic backdrop continues to improve," Linenberg said. "Furthermore, the airline is starting to see the return of corporate travelers."

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This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.