In a boost for the aviation industry, airline stocks experienced significant growth on Thursday following better-than-expected quarterly results and the Federal Aviation Administration's (FAA) approval for the return of 171 Boeing 737 Max 9 jets after safety checks.

American Airlines (AAL) saw an 8% rise in stock prices after issuing a promising guidance for 2024, driven by increasing capacity domestically and internationally. The positive outlook contributed to investor confidence, resulting in a surge in share value.

Similarly, Southwest Airlines (LUV) witnessed a temporary spike in its stock prices due to remarkable revenue growth in 2023, coupled with fourth-quarter profits that surpassed Wall Street's expectations. Strong performance in November and December, particularly with bookings made closer to the travel date and business travel, played a crucial role in the company's success.

Alaska Airlines (ALK), despite beating earnings estimates for its latest quarter, revealed that it expects to incur $150 million in costs due to the grounding of its Boeing 737 Max 9 fleet following a mid-air door incident in January. Nevertheless, the airline experienced a rise in stock prices, benefiting from the overall positive sentiment in the industry.

The FAA's approval of the inspection and maintenance process for the grounded Boeing 737 Max 9 aircraft acted as a major catalyst for airline stocks. Upon successful completion of the safety checks, the aircraft will be eligible to return to service. United Airlines (UAL) and Alaska Airlines are the only U.S. operators utilizing these planes. As a result, both airlines observed a stock price increase of more than 3% on Thursday.

Alaska Airlines has been grappling with flight cancellations, ranging from 110 to 150 flights per day, following the grounding of its Boeing 737 Max 9 fleet. However, the carrier remains committed to resuming operations of these aircraft once they are deemed safe.

During United Airlines' earnings call this week, Chief Financial Officer Mike Leskinen acknowledged the impact of the grounding on their operations. United has a total of 107 aircraft scheduled for delivery in 2024, with 31 of them being Boeing 737 Max 9. However, Leskinen expressed skepticism about whether all of these aircraft would be delivered as planned, and also anticipated a decrease in orders and deliveries from Boeing in 2025.

The positive quarterly results, coupled with the FAA's approval for the return of Boeing 737 Max 9 jets, have injected optimism into the airline industry. As the aviation sector recovers from the challenges posed by the pandemic and navigates through ongoing uncertainties, the industry's swift rebound becomes a promising sign for investors and passengers alike.