United Airlines Stock Soars, Affecting 127 ETFs

United Airlines stock was up more than 12% before noon on Thursday in the wake of its earnings release yesterday.  

While the company recorded a $1.4 billion loss, translating into a $4.24 per share loss for the first quarter, its revenue was more than twice what it notched a year ago. The company also expects the rest of 2022 to be profitable due to spiking demand. 

That and the recent lifting of airline mask mandates have generated enough enthusiasm for investors to bet big on the airline’s performance going forward. That boost in share price will no doubt affect the 127 ETFs that, in aggregate, hold 38.4 million shares, according to ETF.com’s Stock Finder tool. At current share prices, that translates into roughly $2 billion, or 11.7% of the company’s total market capitalization.  

Unsurprisingly, the $3.4 billion U.S. Global Jets ETF (JETS) has the largest allocation to United Airlines of any U.S.-listed ETF, which includes the stock as the second-largest holding in its portfolio, with a weight of 11.28%.  

JETS also holds more shares of UAL than any other ETF, with 8.69 million, or nearly 23% of the total shares held in ETFs. The airline-focused ETF is followed by two more travel-related ETFs, the SonicShares Airlines, Hotels, Cruise Lines ETF (TRYP) and the Defiance Hotel, Airline, and Cruise ETF (CRUZ), which have allocations to the stock of 3.99% and 3.12%, respectively.  

Beyond JETS, the largest ETFs own the most shares of UAL. The $400.7 billion SPDR S&P 500 ETF Trust (SPY) has a weighting in the stock of just .04% but holds 3.45 million shares. It’s followed by the $318.6 billion iShares Core S&P 500 ETF (IVV), which holds 2.81 million shares, translating into a .04% weighting.  

Roughly one-third of the ETFs holding UAL (41 funds) are classified as plain vanilla, cap-weighted ETFs. Thirteen actively managed ETFs hold the stock, while 13 value funds hold it as well. Another 10 can be categorized as ESG ETFs.  

The stock’s rapid rise suggests that investors expect the travel industry to return to normal as the pandemic continues its slow fade from the public eye. 

Contact Heather Bell at [email protected]