More Flight Cuts Send JetBlue Stock Lower

The security is looking to end 2021 in the red

Deputy Editor
Dec 30, 2021 at 9:33 AM
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The shares of JetBlue Airways Corporation (NASDAQ:JBLU) are under pressure this morning, following news that the airline will cut roughly 1,280 flights starting today, Dec. 30, through Jan. 13. JetBlue's decision comes after the airline was forced to cancel thousands of flights since Christmas Eve due to the spread of the Covid-19 omicron variant among staff members, and the airline hopes the premature cuts will prevent further surprise cancelations. The stock was last seen down 0.4% at $14.33. 

It's been tough for the airline sector throughout the holidays, with a collective 4,000 flights canceled between JetBlue, American Airlines (AAL), United Airlines (UAL), and Delta Air Lines (DAL). JBLU, in particular, lost momentum just before Christmas Eve, with its 80-day moving average putting an additional layer of pressure on the equity. JBLU still sports a 7.1% month-to-date lead, but that's about all it has going for it, as the stock looks to settle with a small 1% loss for the year. 

Back in October, Goldman Sachs swept the airline sector with bear notes, including a downgrade to "neutral" for JetBlue. Sentiment surrounding JBLU is still mostly optimistic, however, which could leave room for downgrades and/ or price-target cuts going forward. Of the 12 in coverage, eight still say "buy" or better, while the 12-month consensus price target of $19.23 is a 33.7% premium to current levels. 

Options traders, on the other hand, haven't been more bearish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), JBLU sports a 10-day put/call volume ratio that stands higher than all other readings from the past year. This implies long puts are getting picked up at a much quicker-than-usual clip. 

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