JetBlue fuel hedge strategy. You never know if it works out. $JBLU

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JetBlue Airways Corporation (Nasdaq:JBLU) reported numbers which looked pretty good. “JetBlue’s solid fourth quarter results capped a very good year for JetBlue,” said Dave Barger, JetBlue’s CEO. Regular readers may discern I am not fond of airline stocks. Something about not covering your cost of capital as an industry really gets my goat. Well anyway airline companies live and die by their fuel costs. Most have hedging strategies. JetBlue explained where they are going forward.

But they never report how the hedges worked out historically. If you trade commodities, which this is, you have an account with regular reporting. Are you up or down? Loss or gain? Smart or stupid? JetBlue and most airlines never seem to report historically. The smart or stupid determination is never publicly reconciled. The idea is to hedge forward and control your costs. But there are hedging strategies. How good is JetBlue doing?

Airlines are commodity driven and should have more transparent reporting on how they manage this critical cost.

George Gutowski writes from a caveat emptor perspective.

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