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What: Shares of regional airline Republic Airways Holdings (NASDAQOTH:RJETQ) dropped 19% after reporting third quarter results.

So what: Available seat miles fell 5.7% to 3.6 billion miles in the quarter, revenue fell 2.6% to $340.5 million, and net income fell 84.3% to $2.9 million, or $0.06 per share. The results fell short of the $0.08 per share estimate from Wall Street.  

This was the quarter that was affected by a pilot shortage and there's no way analysts could have guessed earnings, so the miss should be taken with a big grain of salt.

Now what: There were a number of costs from items like idled aircraft that affected earnings and a lot of those will be one-time items given the new pilot agreement that was reached late in the quarter. But that agreement included a 74% pay increase for pilots and when combined with disputes with Delta and Bombardier the company still isn't out of the woods.

Republic Airways is a less risky company than it was a few months ago, but it's uncertain what long-term profitability will look like and how litigation currently in court will work out. With that uncertainty I am staying out of the stock today, but keep an eye out for stabilizing trends in coming quarter that will bring the company, and stock, to a more stable place.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.