3 Airline Stocks Popping on Bullish Analyst Notes

UAL, JBLU, and HA stocks are proving resilient to today's broad-market sell-off

Jan 30, 2018 at 10:20 AM
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The U.S. stock market is on track for its second day of sharp losses, but not all of the day's action is to the downside. Among stocks trading in positive territory are airlines United Continental Holdings Inc (NYSE:UAL), JetBlue Airways Corporation (NASDAQ:JBLU), and Hawaiian Holdings, Inc. (NASDAQ:HA), following a round of positive analyst attention. Here's a closer look at how shares of UAL, JBLU, and HA are performing today.

Analyst Calls UAL Stock Cheapest in Sector

United Continental is up 1.4% to trade at $66.73, after J.P. Morgan Securities upgraded the stock to "overweight" and boosted its price target to $83 from $60 -- and called it the cheapest among its sector peers. The brokerage firm also said UAL's plan to increase capacity was "highly rational," and that sentiment was the only thing affected by Tuesday's announcement, not fundamentals.

After plunging nearly 13% last week, UAL shares appear to have stabilized atop their 50-day moving average. Nevertheless, the security remains almost 10% lower on a six-month basis, and short sellers have been betting on bigger losses. Short interest jumped 8% in the most recent reporting period to 11.54 million shares -- the most since mid-October.

Cost Control, Balance Sheet Earn JetBlue Airways a High-Profile Upgrade

J.P. Morgan Securities also upgraded JetBlue Airways to "overweight," while lifting its price target to $26 from $22 -- territory not seen since December 2015 -- with the brokerage firm waxing optimistic on the company's cost control and balance sheet. The stock has popped 1.6% to trade at $20.61, but remains nearly 11% off its Jan. 16 high of $23.08, thanks to last Thursday's post-earnings bear gap. What's more, today's surge could be contained near $20.80 -- which coincides with a 38.2% Fibonacci retracement of the stock's 2017 rally, and its recently breached 80-day moving average.

Short sellers are likely hoping the stock resumes its recent technical troubles. Short interest rose 17.8% between the Dec. 15 and Jan. 15 reporting periods to 17.9 million shares. This accounts for just 5.45% of JBLU stock's available float, though, meaning there's plenty of room shorts to ramp up their bearish exposure.

Hawaiian Holdings Earnings Have Analysts Raising Price Targets

Analysts were quick to chime in on Hawaiian Holdings, after the company reported fourth-quarter adjusted earnings of $1.10 per share on revenue of $686.55 million -- better than analysts were expecting. Morgan Stanley, for instance, raised its price target to $35 from $32, while Stifel boosted its HA target price to $45 from $40.

HA stock is up 2.9% at $38.60 in early trading. Longer term, the stock has struggled -- stringing together a five-week losing streak, and staring at a 25% 12-month deficit. Plus, Hawaiian Holdings shares are churning below their 140-day moving average, which quickly contained a rally off their Nov. 7 annual low of $32.40.

And, after a brief period of covering in the fourth quarter, short sellers have once again set their sights on HA. Short interest rose 13.7% in the most recent two-week reporting period to 4.63 million shares, its loftiest perch since the Oct. 15.

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