J.P. Morgan Securities upgraded JBLU to "overweight" from "underweight"
The shares of JetBlue Airways Corporation (NASDAQ:JBLU) are flying this morning, after the airline concern got an upgrade from J.P. Morgan Securities. The analyst lifted its rating to "overweight" from "underweight," and upped its price target to $25 from $15. J.P. Morgan Securities also lifted its rating on Southwest Airlines (LUV) and Spirit Airlines (SAVE), noting that it believed the pandemic will have no "permanent, negative margin impact on U.S. airlines." The security was last seen up 2.6% at $21.31
This marks at least the third bull note JBLU has seen this month. Raymond James came in with a bull note early last week, and just one day later, Morgan Stanley hiked up its price target. There are still some holdouts among the brokerage bunch, though, and coming into today, five of the 11 in coverage still deemed JetBlue stock a "hold" or worse. Plus, the 12-month consensus price target of $20.86 is a 2% discount to current levels.
Today's pop puts JBLU back within striking distance of its April 6, two-year high of $21.96. While the $22 level continues to elude the equity, last week's pullback from its aforementioned peak was captured by steady support at the 40-day moving average. Plus, JBLU has added over 131% in the past year.
The options pits have been overwhelmingly optimistic as JBLU continues to climb. In fact, at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 10-day call/put volume ratio of 10.45, which stands higher than all other readings from the past year. This means calls are outpacing puts at a much quicker-than-usual clip.
Option volume is skewing bullish again today, with 9,145 calls and 1,768 puts across the tape so far -- double the intraday average. The April 22 and 21 calls are the most popular, followed by the May 22 call. This suggests traders may be eyeing more upside for JBLU by the time these contracts expire.