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Regional Express (ASX:REX) share price soars to 13-year high

rising airline asx share price represented by boy playing with toy plane
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The Regional Express Holdings Ltd (ASX: REX) continued on its vertical ascend today with the stock hitting a 13-year high.

The REX share price surged another 27.3% to $2.47 during lunch time trade when the S&P/ASX 200 Index (Index:^AXJO) inched up 0.3%.

In contrast, the Qantas Airways Limited (ASX: QAN) share price jumped 3.1% to $5.44 and Alliance Aviation Services Ltd (ASX: AQZ) share price fell 2.1% to $3.82 at the time of writing.  

Regional Express share price gets speeding ticket

A number of positive tailwinds have pushed the Regional Express share price higher recently, including hopes of a COVID‐19 vaccine.

But today’s big rise seems to have also baffled the airline after it was issued with a speeding ticket by ASX Ltd (ASX:ASX).

Management offered a number of possible reasons for REX’s soaring share price.

Rising confidence in REX share price

The successful airfare promotion of $69 for a one-way trip between Melbourne and Sydney is one explanation. This could have lifted REX’s profile among the public and investors.

Confidence in REX’s ability to transition to flying jets from propeller aircraft and launch a domestic service between major cities is touted as another potential driver for its share price.

“The recognition by investors of Rex’s attractive lower cost structure relative to its competitors, including because, as reported recently in the press, Virgin has been unsuccessful in lowering its wage structure after negotiations with unions,” said REX.

“The more positive general sentiment in the aviation sector due to the re-opening of domestic borders which has increased demand for passenger services with all airlines.”

Finally, management acknowledged that day traders may also be contributing to the heightened volatility in the stock.

How the REX share price is performing to the sector

Regardless, REX’s shareholders are unlikely to be complaining as the Regional Express share price nearly doubled since the start of 2020.

Not even the popular Qantas share price could keep up as the flying kangaroo crashed by more than 20% over the same period. The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price is also down by a similar amount.

The AQZ share price is doing better, but even than its 51% rise this year can’t keep pace with the REX share price.

But Regional Express isn’t the only stock that looks well placed for 2021. The experts at the Motley Fool are bullish on the outlook of these other ASX stocks.

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Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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