We have written at length in the past about how the price of jet fuel can directly affect earnings at the airlines. In fact, jet fuel can be as much as 30% of an airline’s total cost, and with the price of oil plunging to a 52-week low, one of the few groups that traded higher was the transports, and specifically the airlines.

A new report from Merrill Lynch points out that Brent crude has fallen over 10% since most of the airlines reported in late July. Accordingly, they have done the math and moved 2015 estimates and price objectives higher by about 5%. We screened the Merrill Lynch airline universe for the stocks rated Buy and found four that look very attractive now.

Delta Air Lines

This company consistently has ranked high with Wall Street. Delta Air Lines Inc. (NYSE: DAL) and the regional Delta Connection carriers offer service to 334 destinations in 64 countries on six continents. Atlanta-based Delta employs nearly 80,000 employees worldwide and operates a mainline fleet of more than 700 aircraft. Wall Street analysts have long lauded that Delta has the most extensive hedging policy among the airlines and owns and operates a refinery in addition to a sizable hedging book. The airline has participated in 80% of the price decline since last year and was expected to have an estimated $160 million in hedging gains for 2014.

China Eastern Airlines and Delta recently signed an agreement to expand their partnership and better connect Delta’s global network with China Eastern, one of the leading airlines in China. The agreement will include a $450 million investment by Delta to acquire a 3.55% stake in China Eastern.

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Delta investors are paid a 1.15% dividend. The Merrill Lynch price target goes from $58 to $60. The Thomson/First Call consensus price objective is $59.40. The stock closed most recently at $47.10.

JetBlue Airways

This stock is a top mid-cap pick in the domestic airlines. JetBlue Airways Corp. (NASDAQ: JBLU) has a very high short interest percentage at over 11% of the free float. While that has dropped from near 17% in the spring, short-sellers have to be getting concerned. JetBlue has added high-dollar premium seating to long-haul flights, including New York to Los Angeles and San Francisco routes last year. Importantly, it trades at a low 0.27 price-to-earnings growth number, implying good corporate growth ahead.

JetBlue posted a very strong 8% year-over-year growth in its revenues. Passenger revenues grew by 9% year over year, driven by solid capacity growth and higher passenger revenue per available seat mile during the quarter. It also benefited slightly from a 25% year-over-year decrease in fuel prices, which based on the Brent crude price drop since earnings were reported, should be a strong tailwind for the last half of 2015.

The Merrill Lynch price target for the stock is raised to $29 from $27, and the consensus target is $21.46. The stock close Tuesday at $23.59.

Allegiant Travel

This company is “off the radar” to some, but could offer solid upside as well. Allegiant Travel Co. (NASDAQ: ALGT) is focused on linking travelers in small cities to world-class leisure destinations. The company operates a low-cost, high-efficiency, all-jet passenger airline through its subsidiary, Allegiant Air, while also offering other travel-related products such as hotel rooms, rental cars and attraction tickets.

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The company recently reported outstanding passenger numbers for the first half of 2015 and very strong earnings per share of $3.18, or a nickel above the average analyst EPS estimate and up from just $1.86 a year earlier. Analysts expect the good times to continue, with Allegiant’s full-year EPS nearly doubling to $12.44 in 2015. Plunging jet fuel costs could push that even higher.

Allegiant investors are paid a 0.53% dividend. The Merrill Lynch price target for the niche carrier is raised to $235 from $225. The consensus target is $223.38. Shares closed Tuesday at $226.99.

Spirit Airlines

The company is an ultra-low-cost carrier that sold off big from the springtime highs and is offering investors an awesome entry point. Spirit Airlines Inc. (NASDAQ: SAVE) was named by Air Transport World, the Value Airline of the Year at the 41st Annual Industry Achievement Awards ceremony earlier this year. The carrier’s super-low prices, which are way below industry standard, allow customers to pay up to choose additional amenities.

Spirit has seen a 40% growth in customer satisfaction, according to internal surveys. This growth has also led to Spirit being included in the Department of Transportation monthly Air Travel Consumer Report beginning this year. While the absolutely no-frills airline is not for everyone, it has a loyal customer following that continues to grow.

The Merrill Lynch price target is boosted to $84 from $80, and the consensus target is $78.60. The stock closed Tuesday at $61.16.

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With a combination of low-price leaders, a top mid-cap and a global giant, the Merrill Lynch team has a little something for everybody. One thing is for sure: with a stronger dollar and lower jet fuel prices, the airlines could be poised for a serious run, and growth investors should own shares.

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