United Continental (UAL) Stock Rising Despite Lowering Unit Revenue Guidance

NEW YORK (TheStreet) -- Shares of United Continental Holdings Inc (UAL) were rising by 0.72% to $52.09 in late morning trading Tuesday, despite the company cutting its unit revenue guidance after reporting traffic for May late yesterday.

For the month, United said traffic rose 0.5% while capacity increased by 2.1% from a year ago.

For the current quarter, the airline lowered its unit revenue estimates. It now expects revenue for every seat flown one mile to drop between 5% to 6% from a year ago, compared to its previous guidance of a 4% to 6% decline.

United listed "foreign exchange impact and revenue pressure related to lower oil prices" for the outlook.

In addition, United said close-in domestic bookings and revenue from corporate accounts in the oil business have both softened since its prior forecast. 

Chicago, Ill.-based United Continental Holdings is a holding company operating under its subsidiaries United Air Lines and Continental Airlines.

The company transports people and cargo through its mainline operations, and has contractual relationships with various regional carriers to provide regional jet and turboprop service branded as United Express.

Separately, TheStreet Ratings team rates UNITED CONTINENTAL HLDGS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate UNITED CONTINENTAL HLDGS INC (UAL) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, notable return on equity, good cash flow from operations and compelling growth in net income. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

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