Morgan Stanley Boosts Continental Airlines Outlook

Analyst William Greene cites the airline's estimate for higher August passenger revenue per available seat mile

Morgan Stanley narrowed his loss estimate on Continental Airlines (CAL ).

Analyst William Greene says Continental reported an estimated consolidated breakeven load factor of 74%, well below the total load factor of 81%. He says the estimated 4% to 5% rise in August mainline revenue per available seat mile is due entirely to fuller jets.

Green estimates Continental's August net margin was 8% to 9%, in line with July. In order for the airline to meet his 10-cent third-quarter loss estimate, Green says September's net margin must be roughly -20%. Depending on how demand shapes up in September, he think's theres probably upside risk to his third-quarter loss estimate.

He narrowed the $4.18 2003 loss per share estimate to a $4.10 loss, and now sees a $1.35 loss per share for 2004.