Help, Help, the Sky Is Falling -- Or Is It?

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This just in: Bears take over Wall Street. Bulls sent packing. Airline investors whine, "Oh, woe is me."

OK, now that we've gotten that out of the way, let's cut through all the punditry, predictions and plaintive moaning and look at some specific things going on in our favorite sector.

First, are we surprised by this turn of events of the last few days? Nope. And you shouldn't be, either.

We advised you about possibly yanking those profits out before earnings were announced. And, well, if you didn't do it, then that must mean you are either in this for the long haul or you are a glutton for punishment. Either way, welcome to the club.

So, today, let's drop the longer-term overview perspective and screw on that little lens that lets us take a closer look at some things going on beneath the sound and fury of the market in general.

If you are a short-term investor, here are some things about particular stocks you need to keep in mind in the next 30 to 60 days.

Northwest Airlines

The stock is now hovering around 31 7/8. Shares have lost about 17% on the quarter, and are down about 34% on the year. If your philosophy is "this one can't get much lower," be careful.

First, don't confuse the probable strike by pilots at

Northwest

(NWAC)

at the end of this month with the situation that faced

AMR

,

(AMR)

, the parent of

American Airlines

, last year. American was an airline making lots of money, and was also an airline that outlobbied, outspent and outmaneuvered its pilots' union up one side and down the other. Northwest pilots are represented by the

Air Line Pilots Association

, and ALPA carries much more political clout. Don't expect to see Clinton nip this one in the bud.

In addition, it was announced Wednesday that, as we had predicted, the proposed

International Association of Machinists

contract at Northwests has been soundly defeated by the rank and file.

This airline has been propping up its financials for years at the expense of reinvestment in the airline. The chickens have come home to roost, and folks, this one ain't going to be pretty. Cluck. Cluck.

American Airlines

Very important update on American. Yes, as you know, we removed American as our major favorite after listening to its conference call this past quarter. We then promptly put

Delta Air Lines

(DAL) - Get Report

in that much-coveted and highly sought-after spot.

When the stock dropped to 73, we said we thought it was a buy. It is now around 65 5/16. It is a buy. Long-term. I don't even want to get into the ridiculously low valuation this places on the airline at this price. However, and this is very important for short-term investors: The problems between the pilots and management that we first talked about here back in June are picking up steam. By this I mean that the pilots are now not only refusing to work overtime hours, they are also calling in sick more often than normal.

Long and the short? The airline is suffering much more heavily from cancellations than it is admitting, and the momentum on the part of the pilots to continue this activity seems to be gaining. And, as we all know, canceled flights wreak havoc with revenues and yields, and cause high-yield business passengers to get very testy.

Long-term, the stock is a good buy, but this is not going to be a good quarter. I think the shares may continue to get beaten up for awhile.

CCAir

The latest hot-rocket regional that we first brought to your attention in May continues to do well. It was one of the few airline stocks that was up Tuesday. For the quarter,

CCAir's

(CCAR)

shares are up about 20%. For the year, the stock is up about 63%. For short-term players, I see this one as a continuing possible short-term player.

Great Lakes Aviation

Again, for those of you with hearty stomachs who like the thrill of the smaller carriers with smaller floats (i.e. more volatility and more opportunities to make --

and

lose -- money), here is another regional rocket that we have not talked about as of yet. Again, the situation here is very similar to the one at CCAir -- a major restructuring of the airline, along with some new lucrative contracts with a major player (in this case

UAL's

(UAL) - Get Report

United Airlines

), is propelling this one.

Great Lakes

(GLUX)

is another stock with near-term potential.

For the quarter, GLUX is up a cool 50%, and it is up 114% on the year.

Frontier Airlines

This airline just reported its first profit in two years. The stock rose about 12% last week as a result. In fact, it was the highest-gaining stock of the 40 we track last week. It is back down a bit this week, but I expect to see it climb up a bit more.

Nothing magical here. Just the old, "what goes down has to go up" adage. However, here is a tip. Even if the airline turns in a fairly so-so quarter, I think we may see a small runup in the stock this quarter. How come? Because year over year, the numbers for this quarter will look very strong. Remember that this time last year

Frontier

(FRNT)

was duking it out with

Western Pacific Airlines

(WPAC)

and both airlines were losing money faster than they were hauling it in.

This next quarter's results will, therefore, look very strong for the carrier year-over-year. Because of that, in addition to other things the airline is doing to improve the cost and revenue side, I would not be surprised to see the share price bump up a bit more this quarter. Frontier is up around 25% on the quarter, and up a hefty 122% on the year.

Holly Hegeman, based in Dallas, pilots the Wing Tips column for TheStreet.com. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. You can usually find Hegeman, publisher of PlaneBusiness Banter, buzzing around her airline industry Web site, at

www.planebusiness.com.