August 29, 2013
10:30 am ET ... S&P RAISES OPINION ON SHARES OF US AIRWAYS TO STRONG
BUY FROM BUY (LCC 15.798*****):We keep our '13 and '14 EPS estimates at
$3.39 and $3.77 and our 12-month target price at $26, an Enterprise Value to
EBITDAR multiple of 3.8X our '13 EBITDAR estimate, still below peers.
Unconfirmed reports from Reuters and other outlets reported today that LCC and
American might be able to reach a settlement with the DOJ on their merger.We
think the merger should not have been blocked, and believe it is feasible that the
divestiture of slots at Reagan National will help reach a settlement. With LCC
shares at an extreme discount to peers, we find the stock compelling. /J.