Seaport Global Downgrades These Airline Stocks Citing 'Energy Market Chaos'
Seaport Global analyst Daniel McKenzie downgraded certain companies in the Airlines sector. McKenzie cites "energy market chaos" tied to the Russian/Ukraine war and calls it a "weaker balance sheet story" as the reason behind the downgrade.
The analyst mentions airlines likely need to begin planning for a worse oil shock. Although pent-up demand "remains great," airlines likely need to cut roughly 10%-15% of capacity from 2022 plans to "gain the kind of pricing power needed to offset the worse oil shock."
Related: Airlines Depend On Hedging, Fuel Surcharges As Oil Surges: Report
The analyst downgraded Gol Linhas Aereas Inteligentes SA (NYSE: GOL) to Neutral from Buy and removed his prior price target.
The analyst downgraded Azul SA (NYSE: AZUL) to Neutral from Buy and removed his price target.
The analyst downgraded American Airlines Group (NASDAQ: AAL) to Neutral from Buy and removed his prior price target.
Price Action: GOL shares are trading lower by 8.52% at $5.55, AZUL lower by 10% at $11.67, and AAL lower by 4.25% at $13.97 on the last check Monday.
Latest Ratings for AAL
Mar 2022 | Seaport Global | Downgrades | Buy | Neutral |
Jan 2022 | Redburn Partners | Downgrades | Buy | Neutral |
Jan 2022 | Morgan Stanley | Upgrades | Underweight | Equal-Weight |
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