Airline Stocks in Kuwait « Alpha Dinar

2011 has been an eventful year for Kuwaiti airlines. Wataniya Airlines announced that they are stopping their operations due to the financial difficulties they were facing. On the flip side of the coin is Jazeera Airways, who announced record profits for Q1. Two airlines operating in the same market are facing two opposing circumstances. Jazeera’s low fare business model is clearly better than Wataniya’s luxury-model. The key issue, in my point of view, is that consumers are willing to relinquish some luxuries in order to save money on short-haul flights.

The stocks of both companies moved in ways that mirrored their companies’ performances. While Wataniya has shed 63% of its value from late April (the day the stock was reinstated after the company’s announcement of ceasing operation) to date. On the other hand, Jazeera has gained 78% during the same period.