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4700.0
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2021-02-18 00:00:00 UTC
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American, JetBlue launch first phase of partnership even as investigations continue
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AAL
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https://www.nasdaq.com/articles/american-jetblue-launch-first-phase-of-partnership-even-as-investigations-continue-2021-02
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nan
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By Tracy Rucinski
Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston.
The joint announcement came even as the U.S. Department of Justice and attorneys general in New York, Massachusetts and other jurisdictions continue to review the proposed tie-up.
"American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said on Wednesday.
New York-based low-cost carrier JetBlue and international major American are hoping the partnership, announced in July, will give them more competitive heft in the U.S. Northeast as the industry recovers from the coronavirus pandemic, which has decimated travel.
"The alliance is also essential to getting our planes back in the air profitably and crewmembers working again," said JetBlue's head of revenue planning, Scott Laurence.
The two airlines are also introducing 33 new routes in the first phase of their alliance, which American's chief revenue officer, Vasu Raja, called "the first step to delivering the best customer proposition with the biggest network in New York and Boston."
Codesharing allows travelers to book with one airline for flights operated by a partner. The two airlines will also begin offering reciprocal benefits on their loyalty programs this spring.
Following a U.S. Department of Transportation review, American and JetBlue agreed to divest some slots at John F. Kennedy International Airport in New York and Ronald Reagan Washington National Airport (DCA) near Washington and will refrain from coordinating on some markets.
JetBlue pilots voted earlier this week to reject a tentative agreement that would have given the airline contractual relief to implement the partnership. JetBlue said it still planned to move forward.
(Reporting by Tracy Rucinski; editing by Jonathan Oatis)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. New York-based low-cost carrier JetBlue and international major American are hoping the partnership, announced in July, will give them more competitive heft in the U.S. Northeast as the industry recovers from the coronavirus pandemic, which has decimated travel. The two airlines are also introducing 33 new routes in the first phase of their alliance, which American's chief revenue officer, Vasu Raja, called "the first step to delivering the best customer proposition with the biggest network in New York and Boston."
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. "American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said on Wednesday. Following a U.S. Department of Transportation review, American and JetBlue agreed to divest some slots at John F. Kennedy International Airport in New York and Ronald Reagan Washington National Airport (DCA) near Washington and will refrain from coordinating on some markets.
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. The two airlines are also introducing 33 new routes in the first phase of their alliance, which American's chief revenue officer, Vasu Raja, called "the first step to delivering the best customer proposition with the biggest network in New York and Boston." Following a U.S. Department of Transportation review, American and JetBlue agreed to divest some slots at John F. Kennedy International Airport in New York and Ronald Reagan Washington National Airport (DCA) near Washington and will refrain from coordinating on some markets.
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. The joint announcement came even as the U.S. Department of Justice and attorneys general in New York, Massachusetts and other jurisdictions continue to review the proposed tie-up. "American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said on Wednesday.
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4701.0
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2021-02-18 00:00:00 UTC
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American, JetBlue launch first phase of partnership even as investigations continue
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AAL
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https://www.nasdaq.com/articles/american-jetblue-launch-first-phase-of-partnership-even-as-investigations-continue-2021-0
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nan
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nan
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By Tracy Rucinski
Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston.
The joint announcement came even as the U.S. Department of Justice and attorneys general in New York, Massachusetts and other jurisdictions continue to review the proposed tie-up.
"American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said in its annual report released late Wednesday.
New York-based low-cost carrier JetBlue and international major American are hoping the partnership, announced in July, will give them more competitive heft in the U.S. Northeast as the industry recovers from the coronavirus pandemic, which has decimated travel.
"The alliance is also essential to getting our planes back in the air profitably and crewmembers working again," said JetBlue's head of revenue planning, Scott Laurence.
The two airlines are also introducing 33 new routes in the first phase of their alliance, which American's chief revenue officer, Vasu Raja, called "the first step to delivering the best customer proposition with the biggest network in New York and Boston."
Codesharing allows travelers to book with one airline for flights operated by a partner. The two airlines will also begin offering reciprocal benefits on their loyalty programs this spring.
Following a U.S. Department of Transportation review, American and JetBlue agreed to divest some slots at John F. Kennedy International Airport in New York and Ronald Reagan Washington National Airport (DCA) near Washington and will refrain from coordinating on some markets.
JetBlue pilots voted earlier this week to reject a tentative agreement that would have given the airline contractual relief to implement the partnership. JetBlue said it still planned to move forward.
The union representing American Airlines' pilots said on Thursday it was still analyzing the codesharing announcement.
(Reporting by Tracy Rucinski; editing by Jonathan Oatis)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. New York-based low-cost carrier JetBlue and international major American are hoping the partnership, announced in July, will give them more competitive heft in the U.S. Northeast as the industry recovers from the coronavirus pandemic, which has decimated travel. The two airlines are also introducing 33 new routes in the first phase of their alliance, which American's chief revenue officer, Vasu Raja, called "the first step to delivering the best customer proposition with the biggest network in New York and Boston."
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. "American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said in its annual report released late Wednesday. The union representing American Airlines' pilots said on Thursday it was still analyzing the codesharing announcement.
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. "American and JetBlue intend to cooperate with those investigations, but are proceeding with plans to implement this alliance," American said in its annual report released late Wednesday. Following a U.S. Department of Transportation review, American and JetBlue agreed to divest some slots at John F. Kennedy International Airport in New York and Ronald Reagan Washington National Airport (DCA) near Washington and will refrain from coordinating on some markets.
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By Tracy Rucinski Feb 18 (Reuters) - American Airlines Group Inc AAL.O and JetBlue Airways Corp JBLU.O said on Thursday they are launching the first phase of their partnership with codeshares on nearly 80 routes from New York and Boston. The joint announcement came even as the U.S. Department of Justice and attorneys general in New York, Massachusetts and other jurisdictions continue to review the proposed tie-up. The union representing American Airlines' pilots said on Thursday it was still analyzing the codesharing announcement.
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4702.0
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2021-02-18 00:00:00 UTC
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FTSE 100 flat as downbeat Barclays earnings offset gains in mining stocks
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AAL
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https://www.nasdaq.com/articles/ftse-100-flat-as-downbeat-barclays-earnings-offset-gains-in-mining-stocks-2021-02-18
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For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window
FTSE 100 flat, FTSE 250 adds 0.3%
Feb 18 (Reuters) - London's FTSE 100 was flat on Thursday as weakness in financial stocks on the back of a glum annual earnings report from Barclays offset gains in mining stocks, while Indivior fell after a decline in annual revenue.
The commodity-heavy FTSE 100 .FTSE was flat, with miners Anglo American AAL.L, Rio Tinto RIO.L and BHP Group BHPB.L leading gains.
Healthcare stocks led declines, with GlaxoSmithKline GSK.L shedding 1.8%
Barclays BARC.L fell 0.9% after the lender's 2020 annual profit halved.
Indivior NDV.L fell 2.6% after the opioid addiction treatment maker's annual revenue fell 18%, hit by a decline in demand for its best-selling drug due to cheaper rivals and as patients stayed away from hospitals during the COVID-19 pandemic.
Moonpig MOONM.L gained 0.6% after the online greeting card retailer said it expects full-year revenue to almost double, helped by robust demand for its services during the COVID-19 pandemic.
The mid-cap FTSE 250 index .FTMC rose 0.3%.
(Reporting by Shivani Kumaresan and Amal S in Bengaluru; Editing by Vinay Dwivedi)
((Shivani.Kumaresan@thomsonreuters.com; +1 646 223 8780;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The commodity-heavy FTSE 100 .FTSE was flat, with miners Anglo American AAL.L, Rio Tinto RIO.L and BHP Group BHPB.L leading gains. Healthcare stocks led declines, with GlaxoSmithKline GSK.L shedding 1.8% Barclays BARC.L fell 0.9% after the lender's 2020 annual profit halved. Moonpig MOONM.L gained 0.6% after the online greeting card retailer said it expects full-year revenue to almost double, helped by robust demand for its services during the COVID-19 pandemic.
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The commodity-heavy FTSE 100 .FTSE was flat, with miners Anglo American AAL.L, Rio Tinto RIO.L and BHP Group BHPB.L leading gains. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window FTSE 100 flat, FTSE 250 adds 0.3% Feb 18 (Reuters) - London's FTSE 100 was flat on Thursday as weakness in financial stocks on the back of a glum annual earnings report from Barclays offset gains in mining stocks, while Indivior fell after a decline in annual revenue. Healthcare stocks led declines, with GlaxoSmithKline GSK.L shedding 1.8% Barclays BARC.L fell 0.9% after the lender's 2020 annual profit halved.
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The commodity-heavy FTSE 100 .FTSE was flat, with miners Anglo American AAL.L, Rio Tinto RIO.L and BHP Group BHPB.L leading gains. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window FTSE 100 flat, FTSE 250 adds 0.3% Feb 18 (Reuters) - London's FTSE 100 was flat on Thursday as weakness in financial stocks on the back of a glum annual earnings report from Barclays offset gains in mining stocks, while Indivior fell after a decline in annual revenue. Indivior NDV.L fell 2.6% after the opioid addiction treatment maker's annual revenue fell 18%, hit by a decline in demand for its best-selling drug due to cheaper rivals and as patients stayed away from hospitals during the COVID-19 pandemic.
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The commodity-heavy FTSE 100 .FTSE was flat, with miners Anglo American AAL.L, Rio Tinto RIO.L and BHP Group BHPB.L leading gains. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window FTSE 100 flat, FTSE 250 adds 0.3% Feb 18 (Reuters) - London's FTSE 100 was flat on Thursday as weakness in financial stocks on the back of a glum annual earnings report from Barclays offset gains in mining stocks, while Indivior fell after a decline in annual revenue. Healthcare stocks led declines, with GlaxoSmithKline GSK.L shedding 1.8% Barclays BARC.L fell 0.9% after the lender's 2020 annual profit halved.
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4703.0
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2021-02-18 00:00:00 UTC
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1 Effective Way Investors Can De-Risk Their Portfolios
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https://www.nasdaq.com/articles/1-effective-way-investors-can-de-risk-their-portfolios-2021-02-18
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Diversification should play an important role in any investor's strategy. But simply buying stocks from other industries isn't necessarily a guaranteed way to protect yourself from a market crash or downturn. American Airlines and Royal Caribbean are technically in different industries, but they're both struggling due to the pandemic and are down more than 30% over the past year (while the S&P 500 has risen 16%). Holding both stocks in your portfolio would effectively compound your risk.
That's why simply selecting stocks from other industries is not enough. Investors should also consider how closely correlated stocks are. A correlation shows the relationship between values and how they move together. For stocks, it's important because you can use correlations to help predict whether two or more investments might move in the same direction.
Image source: Getty Images.
Investing in uncorrelated stocks gives you much better diversification
Calculating correlations can be a time-consuming activity, but just looking at stock charts can give you a quick glimpse as to how closely one follows another. Here's how two top marijuana stocks, Aurora Cannabis (NYSE: ACB) and Canopy Growth (NASDAQ: CGC), have moved over the past three years:
CGC data by YCharts
The two stocks do not move dollar for dollar in the same direction, but they do follow a very similar path -- although Aurora Cannabis has failed to replicate Canopy Growth's recent spike after the company's CEO made a shocking and bullish prediction suggesting it could soon be operating in the U.S. market. Company-specific factors can disrupt these correlations, but generally, investors can expect to see cannabis producers Canopy Growth and Aurora Cannabis move in fairly similar directions, as they will both benefit from the same industry-specific trends. Investing in both of these stocks can amplify your returns when times are good and there's a lot of bullishness surrounding the cannabis industry. But when the outlook isn't so good, holding both of these stocks can compound your losses and put you in a bigger hole.
A good option if you invest in one of these stocks can be to add a more conservative stock like Johnson & Johnson to your portfolio. The healthcare giant is not in cannabis, and a quick look at its stock performance shows that it hasn't moved in the same direction as either of those pot stocks:
CGC data by YCharts
Despite the volatility of both pot stocks, Johnson & Johnson's shares have grown steadily over the same time frame. This is an example of an uncorrelated stock and one that could be a great option for cannabis investors looking to diversify their investments. By holding Johnson & Johnson in your portfolio, you can earn good returns even as Canopy Growth and Aurora Cannabis shares fluctuate wildly.
But when looking at uncorrelated stocks, you also want to be careful not to become too aggressive and focus on the ones that are negatively correlated. That could prove disastrous for your portfolio.
Negatively correlated stocks could offset your gains
A negative correlation is when a stock moves in the opposite direction of a given investment. One example involves gold mining company Kirkland Lake. When investors look for safety as opposed to growth, they often turn to gold or gold stocks, which explains why Kirkland Lake and Canopy Growth have moved in opposite directions in recent years:
CGC data by YCharts
Investing in gold stocks can be a great way to gain exposure to the rising price of gold. But the danger with negatively correlated stocks is that they can offset one another's returns. If the price of one stock goes up, then a negatively correlated stock will go down, especially the greater the correlation is. While it might not be a bad idea to hold a few such investments if it is part of a broader strategy, this is an example where diversifying too much can bring down your portfolio's overall performance.
Aim for zero
If you're building your portfolio, look for stocks that do not have any correlation to one another, whether it is positive or negative. The lower the overall correlation, the more diversification you can achieve.
But it is important to remember that correlations can change, especially if a company enters another industry or takes on a new strategy. Many marijuana companies, for instance, are focusing more on the consumer packaged goods industry. And Jazz Pharmaceuticals recently acquired cannabis stock GW Pharmaceuticals, which will likely affect the strategy for both companies moving forward.
The bottom line is that investors will still need to continue to monitor their stocks if they want to avoid too much exposure to a segment of the market. But if you don't want to be bothered with worrying about whether stocks are correlated or not and whether your portfolio is diverse enough, you can always invest in an exchange-traded fund (ETF) that mirrors the S&P 500.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 15 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines and Royal Caribbean are technically in different industries, but they're both struggling due to the pandemic and are down more than 30% over the past year (while the S&P 500 has risen 16%). Here's how two top marijuana stocks, Aurora Cannabis (NYSE: ACB) and Canopy Growth (NASDAQ: CGC), have moved over the past three years: CGC data by YCharts The two stocks do not move dollar for dollar in the same direction, but they do follow a very similar path -- although Aurora Cannabis has failed to replicate Canopy Growth's recent spike after the company's CEO made a shocking and bullish prediction suggesting it could soon be operating in the U.S. market. Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
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Here's how two top marijuana stocks, Aurora Cannabis (NYSE: ACB) and Canopy Growth (NASDAQ: CGC), have moved over the past three years: CGC data by YCharts The two stocks do not move dollar for dollar in the same direction, but they do follow a very similar path -- although Aurora Cannabis has failed to replicate Canopy Growth's recent spike after the company's CEO made a shocking and bullish prediction suggesting it could soon be operating in the U.S. market. By holding Johnson & Johnson in your portfolio, you can earn good returns even as Canopy Growth and Aurora Cannabis shares fluctuate wildly. When investors look for safety as opposed to growth, they often turn to gold or gold stocks, which explains why Kirkland Lake and Canopy Growth have moved in opposite directions in recent years: CGC data by YCharts Investing in gold stocks can be a great way to gain exposure to the rising price of gold.
|
Here's how two top marijuana stocks, Aurora Cannabis (NYSE: ACB) and Canopy Growth (NASDAQ: CGC), have moved over the past three years: CGC data by YCharts The two stocks do not move dollar for dollar in the same direction, but they do follow a very similar path -- although Aurora Cannabis has failed to replicate Canopy Growth's recent spike after the company's CEO made a shocking and bullish prediction suggesting it could soon be operating in the U.S. market. The healthcare giant is not in cannabis, and a quick look at its stock performance shows that it hasn't moved in the same direction as either of those pot stocks: CGC data by YCharts Despite the volatility of both pot stocks, Johnson & Johnson's shares have grown steadily over the same time frame. Negatively correlated stocks could offset your gains A negative correlation is when a stock moves in the opposite direction of a given investment.
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For stocks, it's important because you can use correlations to help predict whether two or more investments might move in the same direction. The healthcare giant is not in cannabis, and a quick look at its stock performance shows that it hasn't moved in the same direction as either of those pot stocks: CGC data by YCharts Despite the volatility of both pot stocks, Johnson & Johnson's shares have grown steadily over the same time frame. By holding Johnson & Johnson in your portfolio, you can earn good returns even as Canopy Growth and Aurora Cannabis shares fluctuate wildly.
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4704.0
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2021-02-16 00:00:00 UTC
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JetBlue pilots reject tentative agreement for American Airlines partnership
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AAL
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https://www.nasdaq.com/articles/jetblue-pilots-reject-tentative-agreement-for-american-airlines-partnership-2021-02-16
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nan
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nan
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Feb 16 (Reuters) - JetBlue Airways' JBLU.O pilots have rejected a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines AAL.O, their union said in a statement on Tuesday.
For any agreement to proceed, the Air Line Pilots Association said JetBlue management "must provide acceptable assurances that our jobs are safe and valued for years to come."
(Reporting by Tracy Rucinski Editing by Chris Reese)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 16 (Reuters) - JetBlue Airways' JBLU.O pilots have rejected a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines AAL.O, their union said in a statement on Tuesday. For any agreement to proceed, the Air Line Pilots Association said JetBlue management "must provide acceptable assurances that our jobs are safe and valued for years to come." (Reporting by Tracy Rucinski Editing by Chris Reese) ((tracy.rucinski@thomsonreuters.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 16 (Reuters) - JetBlue Airways' JBLU.O pilots have rejected a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines AAL.O, their union said in a statement on Tuesday. For any agreement to proceed, the Air Line Pilots Association said JetBlue management "must provide acceptable assurances that our jobs are safe and valued for years to come." (Reporting by Tracy Rucinski Editing by Chris Reese) ((tracy.rucinski@thomsonreuters.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 16 (Reuters) - JetBlue Airways' JBLU.O pilots have rejected a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines AAL.O, their union said in a statement on Tuesday. For any agreement to proceed, the Air Line Pilots Association said JetBlue management "must provide acceptable assurances that our jobs are safe and valued for years to come." (Reporting by Tracy Rucinski Editing by Chris Reese) ((tracy.rucinski@thomsonreuters.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 16 (Reuters) - JetBlue Airways' JBLU.O pilots have rejected a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines AAL.O, their union said in a statement on Tuesday. For any agreement to proceed, the Air Line Pilots Association said JetBlue management "must provide acceptable assurances that our jobs are safe and valued for years to come." (Reporting by Tracy Rucinski Editing by Chris Reese) ((tracy.rucinski@thomsonreuters.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4705.0
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2021-02-15 00:00:00 UTC
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Warren Buffett Made 3 Big Mistakes Recently -- Here's the Reason They Haven't Hurt Him
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AAL
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https://www.nasdaq.com/articles/warren-buffett-made-3-big-mistakes-recently-heres-the-reason-they-havent-hurt-him-2021-02
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nan
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Few investors have been around as long as 90-year-old investing legend Warren Buffett. The person many call the Oracle of Omaha remains as CEO of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), a company he first started doing business with more than half a century ago. Buffett's lifelong track record has put the power of time to full advantage, and his accomplishments will be hard for anyone to surpass.
Yet Buffett has admittedly gotten a lot of things wrong over the past year. In particular, three missteps have cost him and Berkshire shareholders significant amounts of money. However, there's one thing that Buffett has done that's consistent with his investing strategy -- and it has served to make up for his miscues.
Image source: Getty Images.
Mistake 1: Selling airline stocks low
Many of us have learned the hard way that it's never a good idea to sell stocks after a huge crash. Emotions have us on edge, and the prospect of huge losses can impair anyone's judgment.
Yet that's exactly what Buffett did with Berkshire's airline holdings, selling Delta Air Lines (NYSE: DAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and United Airlines Holdings (NASDAQ: UAL) in early May 2020. At the time, they were down between 45% and 70% from where they had started the year, reeling from the impact of the COVID-19 pandemic.
Since then, however, the stocks have bounced back. They're all still below their levels at the end of 2019, but Southwest in particular has clawed back nearly all of its losses.
DAL data by YCharts.
In Buffett's defense, selling a stock unemotionally can make sense if your thesis for investing in it has changed. That's what happened with Berkshire, as Buffett saw the fundamentals of the airline industry changing forever. Even after a huge infusion of government assistance, moreover, there's no guarantee that airlines will in fact outlast the impact of the pandemic without further financial suffering.
Mistake 2: Selling bank stocks low
Buffett also reversed course with another trend he'd had in place for years. Suddenly, shares of several major banks played a much less prominent role in Berkshire's portfolio at mid-year in 2020. Specifically, Buffett sold out of Goldman Sachs (NYSE: GS) entirely, while slashing his stake in JPMorgan Chase (NYSE: JPM). It's unclear exactly when during the second quarter of 2020 those sales happened, but as of June 30, Goldman was down 14% for the year, and JPMorgan had fallen 33%.
Since then, both banks have completely made up for their losses. JPMorgan is up just a bit since the beginning of 2020, but Goldman has soared to hit new all-time highs.
GS data by YCharts.
To be fair, Buffett has increased his position in Bank of America (NYSE: BAC), which has seen a similar trajectory. However, B of A has underperformed both Goldman and JPMorgan in the past 13 months.
Mistake 3: Delaying big buybacks of Berkshire Hathaway stock
Lastly, Buffett missed a big opportunity to buy shares of Berkshire Hathaway on the cheap. He made only minimal repurchases during the first quarter of 2020, when share prices fell as low as $160. Yet in the second and third quarters, he spent billions on buybacks -- and paid $215 to $220 per share on a big chunk of purchases in September.
Buffett explained that buying back stock when the insurance implications of the coronavirus crisis were uncertain would've been imprudent. When that potential source of liability became less troublesome, the Berkshire CEO felt more comfortable with repurchases. Nevertheless, with so much cash available, Berkshire could've made a bigger impact by pulling the trigger at the optimal time.
Why it didn't matter in the end
As it turns out, though, all of Buffett's mistakes were made up for by a simple decision. Berkshire held onto most of its Apple (NASDAQ: AAPL) stock, and that proved to be a huge moneymaker.
At the beginning of 2020, Berkshire owned just over 1 billion shares of Apple. The value at that time: about $72 billion.
Buffett did trim some of Berkshire's Apple holdings. Yet as of the most recent report, the insurance company still held 944 million shares of the tech giant's stock. With Apple's stock price having soared from $72 to $135 over that span, Buffett's remaining holdings amount to more than $127 billion in Apple stock. That's $55 billion in capital appreciation -- far more than the entire value he had invested in airline stocks.
The lesson: Let your winners keep winning
As a result of a simple investing philosophy, Buffett has managed to hold his own even though he's made some big mistakes recently. Buying great stocks and holding them for the long run can pay off big, and it can also make up for a multitude of missteps along the way.
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*Stock Advisor returns as of November 20, 2020
Dan Caplinger owns shares of Apple and Berkshire Hathaway (B shares). The Motley Fool owns shares of and recommends Apple and Berkshire Hathaway (B shares). The Motley Fool recommends Delta Air Lines and Southwest Airlines and recommends the following options: short January 2023 $200 puts on Berkshire Hathaway (B shares), short March 2021 $225 calls on Berkshire Hathaway (B shares), and long January 2023 $200 calls on Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Yet that's exactly what Buffett did with Berkshire's airline holdings, selling Delta Air Lines (NYSE: DAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and United Airlines Holdings (NASDAQ: UAL) in early May 2020. Buffett's lifelong track record has put the power of time to full advantage, and his accomplishments will be hard for anyone to surpass. Even after a huge infusion of government assistance, moreover, there's no guarantee that airlines will in fact outlast the impact of the pandemic without further financial suffering.
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Yet that's exactly what Buffett did with Berkshire's airline holdings, selling Delta Air Lines (NYSE: DAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and United Airlines Holdings (NASDAQ: UAL) in early May 2020. Mistake 3: Delaying big buybacks of Berkshire Hathaway stock Lastly, Buffett missed a big opportunity to buy shares of Berkshire Hathaway on the cheap. The Motley Fool recommends Delta Air Lines and Southwest Airlines and recommends the following options: short January 2023 $200 puts on Berkshire Hathaway (B shares), short March 2021 $225 calls on Berkshire Hathaway (B shares), and long January 2023 $200 calls on Berkshire Hathaway (B shares).
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Yet that's exactly what Buffett did with Berkshire's airline holdings, selling Delta Air Lines (NYSE: DAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and United Airlines Holdings (NASDAQ: UAL) in early May 2020. Mistake 3: Delaying big buybacks of Berkshire Hathaway stock Lastly, Buffett missed a big opportunity to buy shares of Berkshire Hathaway on the cheap. The Motley Fool recommends Delta Air Lines and Southwest Airlines and recommends the following options: short January 2023 $200 puts on Berkshire Hathaway (B shares), short March 2021 $225 calls on Berkshire Hathaway (B shares), and long January 2023 $200 calls on Berkshire Hathaway (B shares).
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Yet that's exactly what Buffett did with Berkshire's airline holdings, selling Delta Air Lines (NYSE: DAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and United Airlines Holdings (NASDAQ: UAL) in early May 2020. Since then, both banks have completely made up for their losses. With Apple's stock price having soared from $72 to $135 over that span, Buffett's remaining holdings amount to more than $127 billion in Apple stock.
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4706.0
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2021-02-15 00:00:00 UTC
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Mining stocks power gains in Europe on recovery optimism
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AAL
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https://www.nasdaq.com/articles/mining-stocks-power-gains-in-europe-on-recovery-optimism-2021-02-15-0
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nan
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nan
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By Sagarika Jaisinghani
Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year.
The pan-European STOXX 600 .STOXX rose 0.7%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index as copper prices leapt to their highest in more than eight years.
Banks .SX7P and energy stocks .SXEP also climbed as a so-called "recovery trade" sparked demand for sectors that had underperformed the broader index following the coronavirus-driven crash in early 2020.
Energy stocks were also boosted by a jump in oil prices to 13-month highs. O/R
Most European bourses were higher by 0846 GMT, while Asian shares hit record highs earlier in the day. MKTS/GLOB
U.S. President Joe Biden on Friday turned to a bipartisan group of local officials for help on his $1.9 trillion coronavirus relief plan.
"Markets remain target fixated on the Biden stimulus and vaccine rollouts as the magic panacea for the world's pandemic ills," said Jeffrey Halley, senior market analyst at OANDA.
Historic monetary and fiscal stimulus helped the benchmark STOXX 600 rebound about 55% since slumping to a more-than-seven-year low in March 2020, although it has lagged the U.S. S&P 500 .SPX due to prolonged coronavirus-induced lockdowns in Europe.
A recent Reuters poll found the euro zone economy was in a double-dip recession and that economists now expect GDP to contract 0.8% in the first quarter, reversing an earlier forecast for growth of 0.6%.
All eyes will now be on December euro zone industrial production data due at 1000 GMT, and consumer confidence and business activity readings later in the week.
Trading volumes are expected to remain thin on Monday with markets in China, Hong Kong and the United States shut for local holidays.
In company news, Vivendi VIV.PA surged 17.2% to the top of the STOXX 600 as it said it planned to distribute 60% of Universal Music's capital to investors and aimed to list its most-prized asset by the end of the year.
Shares of Groupe Bollore BOLL.PA, which has a 27% stake in Vivendi's share capital, jumped 12.7%.
British pubs group Mitchells & Butlers MAB.L rose 3.8% after saying it intended to raise 350 million pounds ($486 million) in equity and had reached an agreement with its bankers for a new credit facility.
(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Sriraj Kalluvila)
((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The pan-European STOXX 600 .STOXX rose 0.7%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index as copper prices leapt to their highest in more than eight years. By Sagarika Jaisinghani Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. A recent Reuters poll found the euro zone economy was in a double-dip recession and that economists now expect GDP to contract 0.8% in the first quarter, reversing an earlier forecast for growth of 0.6%.
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The pan-European STOXX 600 .STOXX rose 0.7%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index as copper prices leapt to their highest in more than eight years. By Sagarika Jaisinghani Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. Trading volumes are expected to remain thin on Monday with markets in China, Hong Kong and the United States shut for local holidays.
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The pan-European STOXX 600 .STOXX rose 0.7%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index as copper prices leapt to their highest in more than eight years. By Sagarika Jaisinghani Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. "Markets remain target fixated on the Biden stimulus and vaccine rollouts as the magic panacea for the world's pandemic ills," said Jeffrey Halley, senior market analyst at OANDA.
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The pan-European STOXX 600 .STOXX rose 0.7%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index as copper prices leapt to their highest in more than eight years. By Sagarika Jaisinghani Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. Energy stocks were also boosted by a jump in oil prices to 13-month highs.
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4707.0
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2021-02-15 00:00:00 UTC
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Mining stocks power gains in Europe on recovery optimism
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AAL
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https://www.nasdaq.com/articles/mining-stocks-power-gains-in-europe-on-recovery-optimism-2021-02-15
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nan
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nan
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For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window
Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year.
The pan-European STOXX 600 .STOXX rose 0.6%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index. Banks .SX7P and energy stocks .SXEP were also among the biggest gainers.
Most European bourses were higher by 0813 GMT, while Asian shares hit record highs earlier in the day.
Trading volumes are expected to remain thin on Monday with markets in China, Hong Kong and the United States shut for local holidays. MKTS/GLOB
In company news, Bollore SA BOLL.PA surged 14.1% to the top of the STOXX 600 as Vivendi VIV.PA said it planned to distribute 60% of Universal Music's capital to investors and aimed to list its most-prized asset by the end of the year.
The plan represents part of a process launched by Vivendi's top shareholder, French billionaire Vincent Bollore, to cash in on the music industry's revival.
(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Sriraj Kalluvila)
((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The pan-European STOXX 600 .STOXX rose 0.6%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index. Trading volumes are expected to remain thin on Monday with markets in China, Hong Kong and the United States shut for local holidays. MKTS/GLOB In company news, Bollore SA BOLL.PA surged 14.1% to the top of the STOXX 600 as Vivendi VIV.PA said it planned to distribute 60% of Universal Music's capital to investors and aimed to list its most-prized asset by the end of the year.
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The pan-European STOXX 600 .STOXX rose 0.6%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. MKTS/GLOB In company news, Bollore SA BOLL.PA surged 14.1% to the top of the STOXX 600 as Vivendi VIV.PA said it planned to distribute 60% of Universal Music's capital to investors and aimed to list its most-prized asset by the end of the year.
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The pan-European STOXX 600 .STOXX rose 0.6%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. MKTS/GLOB In company news, Bollore SA BOLL.PA surged 14.1% to the top of the STOXX 600 as Vivendi VIV.PA said it planned to distribute 60% of Universal Music's capital to investors and aimed to list its most-prized asset by the end of the year.
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The pan-European STOXX 600 .STOXX rose 0.6%, with Rio Tinto RIO.L, BHP Group BHPB.L and Anglo American AAL.L bolstering the index. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Feb 15 (Reuters) - European shares scaled one-year highs on Monday and mining stocks tracked a jump in copper prices as bets of more U.S. stimulus fuelled optimism around a faster global economic recovery this year. Banks .SX7P and energy stocks .SXEP were also among the biggest gainers.
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4708.0
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2021-02-12 00:00:00 UTC
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White House not mandating COVID-19 testing before domestic flights
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AAL
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https://www.nasdaq.com/articles/white-house-not-mandating-covid-19-testing-before-domestic-flights-2021-02-12
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nan
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nan
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WASHINGTON, Feb 12 (Reuters) - The White House said on Friday it was not planning to require passengers to get negative COVID-19 test results before U.S. domestic airline flights after the potential of new rules raised serious concerns among U.S. airlines, unions and some lawmakers.
White House spokeswoman Jen Psaki said at a media briefing "reports that there is an intention to put in place new requirements, such as testing, are not accurate."
The Centers for Disease Control and Prevention said on Jan. 26 it was "actively looking" at the potential of requiring tests.
(Reporting by David Shepardson Editing by Chris Reese)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The White House said on Friday it was not planning to require passengers to get negative COVID-19 test results before U.S. domestic airline flights after the potential of new rules raised serious concerns among U.S. airlines, unions and some lawmakers. White House spokeswoman Jen Psaki said at a media briefing "reports that there is an intention to put in place new requirements, such as testing, are not accurate." The Centers for Disease Control and Prevention said on Jan. 26 it was "actively looking" at the potential of requiring tests.
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WASHINGTON, Feb 12 (Reuters) - The White House said on Friday it was not planning to require passengers to get negative COVID-19 test results before U.S. domestic airline flights after the potential of new rules raised serious concerns among U.S. airlines, unions and some lawmakers. White House spokeswoman Jen Psaki said at a media briefing "reports that there is an intention to put in place new requirements, such as testing, are not accurate." The Centers for Disease Control and Prevention said on Jan. 26 it was "actively looking" at the potential of requiring tests.
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WASHINGTON, Feb 12 (Reuters) - The White House said on Friday it was not planning to require passengers to get negative COVID-19 test results before U.S. domestic airline flights after the potential of new rules raised serious concerns among U.S. airlines, unions and some lawmakers. White House spokeswoman Jen Psaki said at a media briefing "reports that there is an intention to put in place new requirements, such as testing, are not accurate." (Reporting by David Shepardson Editing by Chris Reese) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The White House said on Friday it was not planning to require passengers to get negative COVID-19 test results before U.S. domestic airline flights after the potential of new rules raised serious concerns among U.S. airlines, unions and some lawmakers. White House spokeswoman Jen Psaki said at a media briefing "reports that there is an intention to put in place new requirements, such as testing, are not accurate." The Centers for Disease Control and Prevention said on Jan. 26 it was "actively looking" at the potential of requiring tests.
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4709.0
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2021-02-12 00:00:00 UTC
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White House meets with airline CEOs on COVID-19 travel issues
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AAL
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https://www.nasdaq.com/articles/white-house-meets-with-airline-ceos-on-covid-19-travel-issues-2021-02-12-0
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines, including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O, met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel.
"We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," Nick Calio, chief executive of the Airlines for America industry group, said in a statement.
The White House, which declined to comment on the airline meeting, has a separate interagency meeting scheduled for later on Friday to discuss coronavirus issues and is not expected to endorse requiring negative COVID-19 tests before flights at this point, said people briefed on the matter, who spoke on condition of anonymity.
The airline CEO meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues came after airlines, aviation unions and other industry groups strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights.
Reuters reported on Thursday that it did not appear the administration would move forward with requiring domestic testing at this point, but stressed officials could revisit the idea if conditions changed.
One idea that has been under serious consideration within the Biden administration is for the Centers for Disease Control and Prevention (CDC) to issue recommendations advising against travel to specific areas of the United States with high COVID-19 caseloads, but the travel recommendations would not be binding, officials said.
The CDC said last month said the Biden administration was actively looking at expanding mandatory COVID-19 testing to U.S. domestic flights. The CDC on Jan. 26 began requiring negative COVID-19 tests or evidence of recovery from the disease from nearly all U.S.-bound international passengers age 2 and older.
(Reporting by David Shepardson; editing by Jonathan Oatis Editing by Chizu Nomiyama and Jonathan Oatis)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By David Shepardson WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines, including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O, met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. "We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," Nick Calio, chief executive of the Airlines for America industry group, said in a statement. Reuters reported on Thursday that it did not appear the administration would move forward with requiring domestic testing at this point, but stressed officials could revisit the idea if conditions changed.
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By David Shepardson WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines, including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O, met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. The airline CEO meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues came after airlines, aviation unions and other industry groups strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights. (Reporting by David Shepardson; editing by Jonathan Oatis Editing by Chizu Nomiyama and Jonathan Oatis) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By David Shepardson WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines, including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O, met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. The White House, which declined to comment on the airline meeting, has a separate interagency meeting scheduled for later on Friday to discuss coronavirus issues and is not expected to endorse requiring negative COVID-19 tests before flights at this point, said people briefed on the matter, who spoke on condition of anonymity. The airline CEO meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues came after airlines, aviation unions and other industry groups strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights.
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By David Shepardson WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines, including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O, met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. Reuters reported on Thursday that it did not appear the administration would move forward with requiring domestic testing at this point, but stressed officials could revisit the idea if conditions changed. One idea that has been under serious consideration within the Biden administration is for the Centers for Disease Control and Prevention (CDC) to issue recommendations advising against travel to specific areas of the United States with high COVID-19 caseloads, but the travel recommendations would not be binding, officials said.
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4710.0
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2021-02-12 00:00:00 UTC
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White House meets with airline CEOs on COVID-19 travel issues
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AAL
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https://www.nasdaq.com/articles/white-house-meets-with-airline-ceos-on-covid-19-travel-issues-2021-02-12
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nan
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nan
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WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel.
"We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," said Airlines for America chief executive Nick Calio in a statement.
(Reporting by David Shepardson Editing by Chizu Nomiyama)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. "We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," said Airlines for America chief executive Nick Calio in a statement. (Reporting by David Shepardson Editing by Chizu Nomiyama) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. "We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," said Airlines for America chief executive Nick Calio in a statement. (Reporting by David Shepardson Editing by Chizu Nomiyama) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. "We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," said Airlines for America chief executive Nick Calio in a statement. (Reporting by David Shepardson Editing by Chizu Nomiyama) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WASHINGTON, Feb 12 (Reuters) - The chief executives of major U.S. airlines including American Airlines AAL.O, Southwest Airlines LUV.N and United Airlines UAL.O met virtually with the White House’s COVID-19 response coordinator on Friday amid airline concerns that new restrictions could be imposed on domestic air travel. "We had a very positive, constructive conversation focused on our shared commitment to science-based policies as we work together to end the pandemic, restore air travel and lead our nation toward recovery," said Airlines for America chief executive Nick Calio in a statement. (Reporting by David Shepardson Editing by Chizu Nomiyama) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4711.0
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2021-02-11 00:00:00 UTC
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U.S. House committee approves another $14 bln for pandemic-hit airlines
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AAL
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https://www.nasdaq.com/articles/u.s.-house-committee-approves-another-%2414-bln-for-pandemic-hit-airlines-2021-02-11
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nan
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nan
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By Tracy Rucinski and David Shepardson
Feb 11 (Reuters) - A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress.
It would be the third round of support for the pandemic-hit industry. American Airlines AAL.O and United Airlines UAL.O have warned of some 27,000 furloughs without an extension of the current package that expires on April 1.
The House of Representatives Financial Services Committee on a 29-24 vote approved the $14 billion for airlines and $1 billion for contractors to cover payroll through September.
The funds will be included in the $1.9 trillion COVID-19 relief bill proposed by President Joe Biden, whose initial plan did not include new money for airlines. House Speaker Nancy Pelosi said on Thursday that she expects lawmakers to complete legislation based on the bill by the end of February.
American Airlines said in a statement after the committee vote that the payroll support program, which covers employee wages and bans job cuts, "has been a lifeline for our team members."
U.S. airlines are burning through millions of dollars every day as the pandemic crushes travel demand.
The Air Line Pilots Association, the largest pilot union in the world, said the funds "would help prevent the additional financial devastation that would result from the aviation industry being forced to furlough tens of thousands of workers."
Budget carriers Spirit Airlines SAVE.N, Allegiant Travel ALGT.O and Frontier Airlines, however, have said in recent weeks that they intend to resume pilot hiring later this year.
Reuters first reported many of the details of the plans to provide new assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak.
(Reporting by Tracy Rucinski and David Shepardson; Editing by Leslie Adler)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL.O and United Airlines UAL.O have warned of some 27,000 furloughs without an extension of the current package that expires on April 1. By Tracy Rucinski and David Shepardson Feb 11 (Reuters) - A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress. House Speaker Nancy Pelosi said on Thursday that she expects lawmakers to complete legislation based on the bill by the end of February.
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American Airlines AAL.O and United Airlines UAL.O have warned of some 27,000 furloughs without an extension of the current package that expires on April 1. By Tracy Rucinski and David Shepardson Feb 11 (Reuters) - A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress. The House of Representatives Financial Services Committee on a 29-24 vote approved the $14 billion for airlines and $1 billion for contractors to cover payroll through September.
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American Airlines AAL.O and United Airlines UAL.O have warned of some 27,000 furloughs without an extension of the current package that expires on April 1. By Tracy Rucinski and David Shepardson Feb 11 (Reuters) - A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress. The House of Representatives Financial Services Committee on a 29-24 vote approved the $14 billion for airlines and $1 billion for contractors to cover payroll through September.
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American Airlines AAL.O and United Airlines UAL.O have warned of some 27,000 furloughs without an extension of the current package that expires on April 1. By Tracy Rucinski and David Shepardson Feb 11 (Reuters) - A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress. It would be the third round of support for the pandemic-hit industry.
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4712.0
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2021-02-11 00:00:00 UTC
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April 1st Options Now Available For American Airlines Group (AAL)
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AAL
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https://www.nasdaq.com/articles/april-1st-options-now-available-for-american-airlines-group-aal-2021-02-11
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nan
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nan
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Investors in American Airlines Group Inc (Symbol: AAL) saw new options begin trading today, for the April 1st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new April 1st contracts and identified one put and one call contract of particular interest.
The put contract at the $16.50 strike price has a current bid of $1.20. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $16.50, but will also collect the premium, putting the cost basis of the shares at $15.30 (before broker commissions). To an investor already interested in purchasing shares of AAL, that could represent an attractive alternative to paying $17.12/share today.
Because the $16.50 strike represents an approximate 4% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 100%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 7.27% return on the cash commitment, or 54.22% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for American Airlines Group Inc, and highlighting in green where the $16.50 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $18.00 strike price has a current bid of $1.25. If an investor was to purchase shares of AAL stock at the current price level of $17.12/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $18.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 12.44% if the stock gets called away at the April 1st expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if AAL shares really soar, which is why looking at the trailing twelve month trading history for American Airlines Group Inc, as well as studying the business fundamentals becomes important. Below is a chart showing AAL's trailing twelve month trading history, with the $18.00 strike highlighted in red:
Considering the fact that the $18.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 99%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 7.30% boost of extra return to the investor, or 54.43% annualized, which we refer to as the YieldBoost.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $17.12) to be 102%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if AAL shares really soar, which is why looking at the trailing twelve month trading history for American Airlines Group Inc, as well as studying the business fundamentals becomes important. Below is a chart showing AAL's trailing twelve month trading history, with the $18.00 strike highlighted in red: Considering the fact that the $18.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options begin trading today, for the April 1st expiration.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.00 strike highlighted in red: Considering the fact that the $18.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options begin trading today, for the April 1st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new April 1st contracts and identified one put and one call contract of particular interest.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.00 strike highlighted in red: Considering the fact that the $18.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options begin trading today, for the April 1st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new April 1st contracts and identified one put and one call contract of particular interest.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.00 strike highlighted in red: Considering the fact that the $18.00 strike represents an approximate 5% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options begin trading today, for the April 1st expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new April 1st contracts and identified one put and one call contract of particular interest.
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4713.0
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2021-02-11 00:00:00 UTC
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White House says no specific decisions on domestic air travel under review
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AAL
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https://www.nasdaq.com/articles/white-house-says-no-specific-decisions-on-domestic-air-travel-under-review-2021-02-11
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 11 (Reuters) - The White House on Thursday rejected media reports it is considering any new domestic air travel restrictions.
"To be clear, there have been no decisions made around additional public health measures for domestic travel safety. The administration is continuing to discuss recommendations across the travel space, but no specific decisions are under consideration," a White House spokesman told Reuters.
Reports that the administration was considering imposing restrictions on travel to Florida brought denunciations from many Republican lawmakers.
The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss travel-related issues, Reuters reported Wednesday.
The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights.
Southwest Airlines Co LUV.N Chief Executive Gary Kelly and the leaders of the airline's unions urged President Joe Biden in a letter not to mandate COVID-19 testing, saying it would put "jobs at risk."
"Such a mandate would be counterproductive, costly, and have serious unintended consequences," said the letter, which was dated Tuesday and released on Wednesday.
The Centers for Disease Control and Prevention (CDC) last month said the Biden administration was "actively looking" at expanding mandatory COVID-19 testing to U.S. domestic flights. The CDC on Jan. 26 began requiring negative COVID-19 tests or evidence of recovery from the disease from nearly all U.S.-bound international passengers age 2 and older.
One idea that has been under review within the Biden administration is for the CDC to issue recommendations advising against travel to areas of the United States with high COVID-19 caseloads, but no decisions have been made and recommendations would not be binding, officials said.
CDC officials have repeatedly urged Americans not to travel unless necessary.
White House COVID-19 official to meet with airline CEOs Friday - sources
GRAPHIC-COVID-19 global trackerhttps://tmsnrt.rs/34pvUyi
GRAPHIC-Where coronavirus cases are rising and falling in the United Stateshttps://tmsnrt.rs/2WTOZDR
(Reporting by David Shepardson; Editing by Lisa Shumaker)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By David Shepardson WASHINGTON, Feb 11 (Reuters) - The White House on Thursday rejected media reports it is considering any new domestic air travel restrictions. The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss travel-related issues, Reuters reported Wednesday. The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights.
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The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss travel-related issues, Reuters reported Wednesday. Southwest Airlines Co LUV.N Chief Executive Gary Kelly and the leaders of the airline's unions urged President Joe Biden in a letter not to mandate COVID-19 testing, saying it would put "jobs at risk." White House COVID-19 official to meet with airline CEOs Friday - sources GRAPHIC-COVID-19 global trackerhttps://tmsnrt.rs/34pvUyi GRAPHIC-Where coronavirus cases are rising and falling in the United Stateshttps://tmsnrt.rs/2WTOZDR (Reporting by David Shepardson; Editing by Lisa Shumaker) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring COVID-19 testing before boarding domestic flights. One idea that has been under review within the Biden administration is for the CDC to issue recommendations advising against travel to areas of the United States with high COVID-19 caseloads, but no decisions have been made and recommendations would not be binding, officials said. White House COVID-19 official to meet with airline CEOs Friday - sources GRAPHIC-COVID-19 global trackerhttps://tmsnrt.rs/34pvUyi GRAPHIC-Where coronavirus cases are rising and falling in the United Stateshttps://tmsnrt.rs/2WTOZDR (Reporting by David Shepardson; Editing by Lisa Shumaker) ((David.Shepardson@thomsonreuters.com; 2028988324;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By David Shepardson WASHINGTON, Feb 11 (Reuters) - The White House on Thursday rejected media reports it is considering any new domestic air travel restrictions. The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss travel-related issues, Reuters reported Wednesday. The Centers for Disease Control and Prevention (CDC) last month said the Biden administration was "actively looking" at expanding mandatory COVID-19 testing to U.S. domestic flights.
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4714.0
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2021-02-11 00:00:00 UTC
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EXCLUSIVE-How GameStop missed out on capitalizing on the Reddit rally
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AAL
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https://www.nasdaq.com/articles/exclusive-how-gamestop-missed-out-on-capitalizing-on-the-reddit-rally-2021-02-11-0
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nan
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nan
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By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin
Feb 11 (Reuters) - U.S. video game retailer GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar with the matter.
The Grapevine, Texas-based company found itself at the epicenter of an unprecedented trading frenzy last month, as amateur investors organized on social media sites such as Reddit to bet against Wall Street hedge funds that had shorted its shares.
While many heavily shorted stocks, from movie theater operator AMC Entertainment Holdings Inc AMC.N to headphone maker Koss Corp KOSS.O, also scored big rallies, "Gamestonk," as it was nicknamed by many online, including Tesla Inc TSLA.O Chief Executive Elon Musk, became synonymous with the wave of trading speculation.
GameStop's market value soared from $1.4 billion on Jan. 11 to a peak of $33.7 billion on Jan. 28. At that point, GameStop could have raised hundreds of millions of dollars through a stock sale to pay down its debt pile, which totaled $216 million net of cash as of the end of October, and fund its transformation into a digital gaming service, as sales at its mall-based stores dwindle.
Yet GameStop never sold shares, the sources said, despite being egged on by many Wall Street pundits to do so. While it could still sell shares in the coming weeks, the opportunity to raise hundreds of millions of dollars has now slipped as the rally in its shares reversed. It now has a market value of $3.6 billion.
GameStop examined the possibility of selling stock during the rally, the sources said. The company had already registered with the U.S. Securities and Exchange Commission (SEC) to sell $100 million worth of stock in December, an option it did not exercise, the sources added.
GameStop decided it was restricted under U.S. financial regulations from selling shares because it had not yet updated investors on its earnings, the sources said. The SEC requires companies to have released such information when conducting stock sales. While GameStop had started preparing results for its fiscal fourth quarter, which ends in January, it was not due to report them for several more weeks, the sources said.
By the time its shares took off in the second half of January, executives had already compiled data and had a clear picture of what the quarter would look like, the sources said.
GameStop could have gone ahead with a stock sale by releasing preliminary earnings. But such a move, carried out for the purposes of a stock sale, came with significant logistical hurdles and regulatory risk that the company was not willing to accept, one of the sources said. The SEC had said it would scrutinize how companies took advantage of the trading volatility to sell stock and had asked that they provide more information to investors about the potential risks.
Representatives of GameStop and the SEC declined to comment.
"They were 2-1/2 months into their quarter when all this stuff took place," said David Erickson, a finance lecturer at the University of Pennsylvania's Wharton School who was previously co-head of global equity capital markets at Barclays Plc BARC.L "It's so deep in the quarter that from a legal and corporate governance perspective they would likely be obligated to pre-announce some high-level financial information for the quarter. And that can't be prepared in just a week."
AMC, AMERICAN AIRLINES
Other companies in the middle of the Reddit frenzy, whose financial quarters finished at the end of December and had already updated investors on their latest financial performance, were able to sell stock when their shares rallied at the end of January.
AMC, whose movie theater business has been hurt by the pandemic, raised roughly $1.2 billion through debt and equity deals after its shares rallied more than 700%.
American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%.
GameStop has lost market share to larger competitors, including Best Buy Co Inc BBY.N and Amazon.com Inc AMZN.O, as consumers buy video games online or through big-box retailers.
Robert W. Baird & Co analysts wrote last month that the best outcome for GameStop shareholders would be for the company to close the majority of its physical stores and diversify into online businesses, including hosting tournaments and events.
One of GameStop's largest shareholders, online pet store Chewy Inc CHWY.N co-founder Ryan Cohen, and two of his partners joined the company's board in January. Last year, hedge funds Hestia Capital Partners and Permit Capital Enterprise Fund also won seats on the board.
(Reporting by Jessica DiNapoli in New York, Svea Herbst-Bayliss in Boston and Joshua Franklin in Miami; editing by Greg Roumeliotis, Grant McCool and Jonathan Oatis)
((Jessica.DiNapoli@thomsonreuters.com; 646-223-4678;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - U.S. video game retailer GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar with the matter. The Grapevine, Texas-based company found itself at the epicenter of an unprecedented trading frenzy last month, as amateur investors organized on social media sites such as Reddit to bet against Wall Street hedge funds that had shorted its shares.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - U.S. video game retailer GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar with the matter. The company had already registered with the U.S. Securities and Exchange Commission (SEC) to sell $100 million worth of stock in December, an option it did not exercise, the sources added.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - U.S. video game retailer GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar with the matter. At that point, GameStop could have raised hundreds of millions of dollars through a stock sale to pay down its debt pile, which totaled $216 million net of cash as of the end of October, and fund its transformation into a digital gaming service, as sales at its mall-based stores dwindle.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - U.S. video game retailer GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar with the matter. The SEC requires companies to have released such information when conducting stock sales.
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4715.0
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2021-02-11 00:00:00 UTC
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EXCLUSIVE-How GameStop missed out on capitalizing on the Reddit rally
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AAL
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https://www.nasdaq.com/articles/exclusive-how-gamestop-missed-out-on-capitalizing-on-the-reddit-rally-2021-02-11
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nan
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nan
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By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin
Feb 11 (Reuters) - GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar the U.S. video game retailer's internal deliberations.
The Grapevine, Texas-based company found itself at the epicenter of an unprecedented trading frenzy last month, as amateur investors organized on social media sites such as Reddit to bet against Wall Street hedge funds that had shorted its shares.
While many heavily shorted stocks, from movie theater operator AMC Entertainment Holdings Inc AMC.N to headphone maker Koss Corp KOSS.O, also scored big rallies, "Gamestonk", as it was nicknamed by many online, including Tesla Inc TSLA.O CEO Elon Musk, became synonymous with the wave of trading speculation.
GameStop's market value soared from $1.4 billion on Jan. 11 to a peak of $33.7 billion on Jan. 28. At that point, GameStop could have raised hundreds of millions of dollars through a stock sale to pay down its debt pile, which totaled $216 million net of cash as of the end of October, and fund its transformation into a digital gaming service, as sales at its mall-based stores dwindle.
Yet GameStop never sold shares, the sources said, despite being egged on by many Wall Street pundits to do so. While it could still sell shares in the coming weeks, the opportunity to raise hundreds of millions of dollars has now slipped as the rally in its shares reversed. It now has a market value of $3.6 billion.
GameStop examined the possibility of selling stock during the rally, the sources said. The company had already registered with the U.S. Securities and Exchange Commission (SEC) to sell $100 million worth of stock in December, an option it did not exercise, the sources added.
GameStop decided it was restricted under U.S. financial regulations from selling shares because it was in possession of significant information about its finances that was not yet available to the public, the sources said. The SEC requires companies to have released such information when conducting stock sales.
The information pertained to GameStop's fiscal fourth quarter, which ended at the end of January. By the time its shares took off in the second half of January, company executives had already compiled data and had a clear picture of what the quarter would look like, the sources said.
GameStop could have gone ahead with a stock sale by releasing preliminary earnings. But such a move, carried out for the purposes of a stock sale, came with significant logistical hurdles and regulatory risk that the company was not willing to accept, one of the sources said. The SEC had said it would scrutinize how companies took advantage of the trading volatility to sell stock and had asked that they provide more information to investors about the potential risks.
A GameStop spokesman declined to comment. The SEC did not immediately respond to a request for comment.
"They were two and a half months into their quarter when all this stuff took place. It's so deep in the quarter that from a legal and corporate governance perspective they would likely be obligated to pre-announce some high-level financial information for the quarter. And that can't be prepared in just a week," said David Erickson, a finance lecturer at the University of Pennsylvania's Wharton School who was previously co-head of global equity capital markets at Barclays Plc BARC.L.
AMC, AMERICAN AIRLINES
Other companies in the midst of the Reddit frenzy whose financial quarters finished at the end of December and had already updated investors on their latest financial performance, were able to sell stock when their shares rallied at the end of January.
AMC, whose movie theater business has been hurt by the pandemic, raised roughly $1.2 billion through debt and equity deals after its shares rallied more than 700%.
American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%.
GameStop has lost market share to larger competitors, including Best Buy Co Inc BBY.N and Amazon.com Inc AMZN.O, as consumers buy video games online or through big-box retailers.
Robert W. Baird & Co analysts wrote last month that the best outcome for GameStop shareholders would be for the company to close the majority of its physical stores and diversify into online businesses, including hosting tournaments and events.
One of GameStop's largest shareholders, online pet store Chewy Inc CHWY.N co-founder Ryan Cohen, and two of his partners joined the company's board in January. Last year, hedge funds Hestia Capital Partners and Permit Capital Enterprise Fund also won seats on the board.
(Reporting by Jessica DiNapoli in New York, Svea Herbst-Bayliss in Boston and Joshua Franklin in Miami; editing by Greg Roumeliotis and Grant McCool)
((Jessica.DiNapoli@thomsonreuters.com; 646-223-4678;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar the U.S. video game retailer's internal deliberations. The Grapevine, Texas-based company found itself at the epicenter of an unprecedented trading frenzy last month, as amateur investors organized on social media sites such as Reddit to bet against Wall Street hedge funds that had shorted its shares.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar the U.S. video game retailer's internal deliberations. The Grapevine, Texas-based company found itself at the epicenter of an unprecedented trading frenzy last month, as amateur investors organized on social media sites such as Reddit to bet against Wall Street hedge funds that had shorted its shares.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar the U.S. video game retailer's internal deliberations. At that point, GameStop could have raised hundreds of millions of dollars through a stock sale to pay down its debt pile, which totaled $216 million net of cash as of the end of October, and fund its transformation into a digital gaming service, as sales at its mall-based stores dwindle.
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American Airlines Group Inc AAL.O, which has also suffered as demand for flights plummeted, pulled the trigger on a plan to sell more than $1 billion of stock last month after its shares rallied as much as 48%. By Jessica DiNapoli, Svea Herbst-Bayliss and Joshua Franklin Feb 11 (Reuters) - GameStop Corp GME.N decided it could not seize on the Reddit-fueled rally in its shares to sell hundreds of millions of dollars worth of stock because of regulatory restrictions, according to three people familiar the U.S. video game retailer's internal deliberations. It now has a market value of $3.6 billion.
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4716.0
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2021-02-10 00:00:00 UTC
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White House COVID-19 official to meet with airline CEOs Friday - sources
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AAL
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https://www.nasdaq.com/articles/white-house-covid-19-official-to-meet-with-airline-ceos-friday-sources-2021-02-10
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 10 (Reuters) - The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss a number of travel-related issues, three people briefed on the matter told Reuters on Wednesday.
The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring predeparture COVID-19 testing before domestic flights.
The White House declined to comment, and major airlines declined or did not respond to requests for comment. The three people spoke on condition of anonymity because the meeting has not been made public.
Southwest Airlines Co LUV.N Chief Executive Gary Kelly and the leaders of the airline's unions urged President Joe Biden in a letter not to mandate COVID-19 testing, saying it would put "jobs at risk."
"Such a mandate would be counterproductive, costly, and have serious unintended consequences," said the letter, which was dated Tuesday but released on Wednesday.
On Wednesday, the Allied Pilots Association, representing the American Airlines' AAL.O 15,000 pilots, said "mandatory pre-flight testing would be unwarranted, logistically impractical, and wasteful, and it would seriously threaten the stability of our industry."
The Centers for Disease Control and Prevention (CDC) last month said the Biden administration was "actively looking" at expanding mandatory COVID-19 testing to U.S. domestic flights. The CDC on Jan. 26 began requiring negative COVID-19 tests or evidence of recovery from the disease from nearly all U.S.-bound international passengers age 2 and older.
The federal government has been mulling additional measures to fight the spread of the coronavirus, but officials said there is no formal proposal on testing currently being circulated within the administration.
On Friday, two senior Boeing Co BA.N executives warned the White House that requiring COVID-19 tests before U.S. flights could pose significant economic harm.
CDC officials have repeatedly urged Americans not to travel unless necessary. CDC Director Rochelle Walensky said on Monday that additional screening at places where people gather like airports could help detect more asymptomatic cases.
Last week, Sara Nelson, a top aviation union leader, said that new domestic testing requirements could devastate the airline industry.
U.S. Representative Peter DeFazio, chair of the House of Representatives' Transportation and Infrastructure Committee, raised significant concerns about domestic testing requirements in a meeting with Biden last Friday.
Transportation Secretary Pete Buttigieg told Reuters last week that decisions about domestic testing will be "guided by facts and by science."
(Reporting by David Shepardson; additional reporting by Tracy Rucinski Editing by Chris Reese and Jonathan Oatis)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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On Wednesday, the Allied Pilots Association, representing the American Airlines' AAL.O 15,000 pilots, said "mandatory pre-flight testing would be unwarranted, logistically impractical, and wasteful, and it would seriously threaten the stability of our industry." The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring predeparture COVID-19 testing before domestic flights. On Friday, two senior Boeing Co BA.N executives warned the White House that requiring COVID-19 tests before U.S. flights could pose significant economic harm.
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On Wednesday, the Allied Pilots Association, representing the American Airlines' AAL.O 15,000 pilots, said "mandatory pre-flight testing would be unwarranted, logistically impractical, and wasteful, and it would seriously threaten the stability of our industry." By David Shepardson WASHINGTON, Feb 10 (Reuters) - The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss a number of travel-related issues, three people briefed on the matter told Reuters on Wednesday. The White House declined to comment, and major airlines declined or did not respond to requests for comment.
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On Wednesday, the Allied Pilots Association, representing the American Airlines' AAL.O 15,000 pilots, said "mandatory pre-flight testing would be unwarranted, logistically impractical, and wasteful, and it would seriously threaten the stability of our industry." By David Shepardson WASHINGTON, Feb 10 (Reuters) - The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss a number of travel-related issues, three people briefed on the matter told Reuters on Wednesday. The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring predeparture COVID-19 testing before domestic flights.
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On Wednesday, the Allied Pilots Association, representing the American Airlines' AAL.O 15,000 pilots, said "mandatory pre-flight testing would be unwarranted, logistically impractical, and wasteful, and it would seriously threaten the stability of our industry." By David Shepardson WASHINGTON, Feb 10 (Reuters) - The chief executives of major U.S. airlines are scheduled to meet virtually on Friday with the White House's COVID-19 response coordinator to discuss a number of travel-related issues, three people briefed on the matter told Reuters on Wednesday. The meeting with coronavirus response coordinator Jeff Zients and other administration officials involved in COVID-19 issues comes as airlines, aviation unions and other industry groups have strongly objected to the possibility of requiring predeparture COVID-19 testing before domestic flights.
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4717.0
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2021-02-10 00:00:00 UTC
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Chile copper cathode shipments plagued by rough seas, shortage of containers
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AAL
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https://www.nasdaq.com/articles/chile-copper-cathode-shipments-plagued-by-rough-seas-shortage-of-containers-2021-02-10
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nan
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nan
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By Fabian Cambero
SANTIAGO, Feb 10 (Reuters) - Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world's largest producer of the red metal, and may continue to slow exports, according to a senior mining executive and local industry analysts.
In January, Chile's top copper shipping port at Mejillones was largely shuttered as ocean swells hammered docking facilities, making it impossible to load ships. Exports of copper concentrate and cathodes, and inputs such as sulfuric acid have all been affected, the sources said.
A senior mining company executive familiar with the situation told Reuters that the seas had calmed and that concentrate shipments were back on track.
But the source and industry analysts said the container shortage was continuing to plague cathode shipments.
"Containers are still tight, and they are very expensive," said Juan Carlos Guajardo, executive director of the consulting firm Plusmining.
The container situation has driven up freight costs in the market and put pressure on copper processing premiums in Asia.
In January, Codelco told Reuters the slowdown due to bad weather had lasted longer than in years past, but said it had successfully adjusted delivery plans to meet customer needs.
The Chilean miner did not immediately respond to a request for comment about the lingering cathode shipment issues.
Chile is home to several top miners, including BHP BHP.AX, Anglo American AAL.L, Glencore GLEN.L and Antofagasta Minerals. ANTO.L
(Reporting by Fabian Cambero, writing by Dave Sherwood; Editing by David Gregorio)
((dave.sherwood@thomsonreuters.com; +56 9 9138 1047, +56 2 2370 4224; Reuters Messaging: dave.sherwood.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Chile is home to several top miners, including BHP BHP.AX, Anglo American AAL.L, Glencore GLEN.L and Antofagasta Minerals. By Fabian Cambero SANTIAGO, Feb 10 (Reuters) - Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world's largest producer of the red metal, and may continue to slow exports, according to a senior mining executive and local industry analysts. A senior mining company executive familiar with the situation told Reuters that the seas had calmed and that concentrate shipments were back on track.
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Chile is home to several top miners, including BHP BHP.AX, Anglo American AAL.L, Glencore GLEN.L and Antofagasta Minerals. By Fabian Cambero SANTIAGO, Feb 10 (Reuters) - Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world's largest producer of the red metal, and may continue to slow exports, according to a senior mining executive and local industry analysts. In January, Chile's top copper shipping port at Mejillones was largely shuttered as ocean swells hammered docking facilities, making it impossible to load ships.
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Chile is home to several top miners, including BHP BHP.AX, Anglo American AAL.L, Glencore GLEN.L and Antofagasta Minerals. By Fabian Cambero SANTIAGO, Feb 10 (Reuters) - Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world's largest producer of the red metal, and may continue to slow exports, according to a senior mining executive and local industry analysts. In January, Chile's top copper shipping port at Mejillones was largely shuttered as ocean swells hammered docking facilities, making it impossible to load ships.
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Chile is home to several top miners, including BHP BHP.AX, Anglo American AAL.L, Glencore GLEN.L and Antofagasta Minerals. By Fabian Cambero SANTIAGO, Feb 10 (Reuters) - Rough seas and a shortage of containers have bogged down shipments of copper cathodes from Chile, the world's largest producer of the red metal, and may continue to slow exports, according to a senior mining executive and local industry analysts. In January, Chile's top copper shipping port at Mejillones was largely shuttered as ocean swells hammered docking facilities, making it impossible to load ships.
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4718.0
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2021-02-09 00:00:00 UTC
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Pick Southwest Stock Over American Airlines For Better Gains?
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AAL
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https://www.nasdaq.com/articles/pick-southwest-stock-over-american-airlines-for-better-gains-2021-02-09
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nan
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nan
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The shares of American Airlines (NASDAQ: AAL) have declined by 38% in the past year compared to a 19% drop observed in Southwest Airlines (NYSE: LUV) stock. Does that make American a better pick over Southwest? Given the ongoing vaccination efforts in multiple countries and the possibility of economic recovery by mid-2021, Trefis believes that Southwest stock can provide better gains to investors willing to bet on the slow-moving airline industry. Per PSP2 (second phase payroll support program) restrictions, airline companies cannot return capital to investors through dividends and share repurchases until March 2022. Despite a substantially higher current P/S multiple, Southwest stock has room for more growth as the $1.7 billion of PSP2 proceeds can completely offset the company’s Q1 losses at a cash burn rate of $17 million per day. Importantly, American Airlines’ $25 billion of net debt makes the stock subject to additional headwinds in the current low demand environment. We compare the historical trends in revenues, margins, and valuation multiple of both companies in an interactive dashboard analysis, American Airlines vs. Southwest Airlines – parts of which are highlighted below.
1. Revenue Growth
Southwest’s growth has been almost similar to American Airlines over the last three years, with LUV’s revenue expanding at an average rate of 3.5% per year from $20.3 billion in 2016 to $22.4 billion in 2019, versus AAL’s revenue which grew by 4.5% from $40.2 billion in 2016 to $45.8 billion in 2019.
In 2020, American Airlines observed 50% (y-o-y) capacity contraction with a 64% load factor. Whereas, Southwest reported 34% (y-o-y) capacity reduction with a 52% load factor – lowering the gap between AAL and LUV’s top line.
In 2020, American Airlines and Southwest Airlines reported $17 billion and $9 billion of total revenues, respectively.
2. Returns (Profits)
Southwest’s operating profit margin has consistently been 6-percentage points higher than American – mostly due to a lower share of salary expenses as a percentage of revenues.
In 2020, American Airlines reported $17.4 billion of revenues and $8.8 billion of net loss – at a net margin of -50.5%
Southwest’s net margins were much better at -24% due to significantly lower interest, salary, and depreciation costs.
Thus, Southwest observed just $1 billion of operating cash outflow compared to the larger $6.5 billion by American.
3. Risk
Per Q4 2020 filings, American and Southwest reported $32 billion and $10 billion of long-term debt on their balance sheet, respectively. After getting restructured in 2012, American Airlines’ debt-laden balance sheet has not been able to shed weight mainly due to high competitive rivalry, which limited airfares and lowered margins.
Currently, American Airlines has $6.8 billion of cash & short-term investments against total debt of $32 billion. With just $10 billion of market capitalization and a huge $25 billion of net debt, Trefis believes that AAL stock faces headwinds in the near-term. More importantly, dividends and share repurchases are suspended until March 2022 – limiting economic returns for short-term investors.
Southwest reported $13 billion of cash & short-term investments against total debt of $10 billion. Interestingly, LUV’s $26 billion market capitalization is more than twice of AAL with a significantly lower net debt.
Higher financial leverage coupled with continued revenue growth is a boon for generating surplus equity returns. However, slow growth and loaded balance sheets negatively affect shareholder returns during recessionary periods. Thus, American Airlines’ stock has lower upside potential compared to Southwest in the near future.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio to beat the market, with over 100% return since 2016, versus 55% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.
See all Trefis Price Estimates and Download Trefis Data here
What’s behind Trefis? See How It’s Powering New Collaboration and What-Ifs For CFOs and Finance Teams | Product, R&D, and Marketing Teams
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The shares of American Airlines (NASDAQ: AAL) have declined by 38% in the past year compared to a 19% drop observed in Southwest Airlines (NYSE: LUV) stock. Revenue Growth Southwest’s growth has been almost similar to American Airlines over the last three years, with LUV’s revenue expanding at an average rate of 3.5% per year from $20.3 billion in 2016 to $22.4 billion in 2019, versus AAL’s revenue which grew by 4.5% from $40.2 billion in 2016 to $45.8 billion in 2019. Whereas, Southwest reported 34% (y-o-y) capacity reduction with a 52% load factor – lowering the gap between AAL and LUV’s top line.
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The shares of American Airlines (NASDAQ: AAL) have declined by 38% in the past year compared to a 19% drop observed in Southwest Airlines (NYSE: LUV) stock. Revenue Growth Southwest’s growth has been almost similar to American Airlines over the last three years, with LUV’s revenue expanding at an average rate of 3.5% per year from $20.3 billion in 2016 to $22.4 billion in 2019, versus AAL’s revenue which grew by 4.5% from $40.2 billion in 2016 to $45.8 billion in 2019. Whereas, Southwest reported 34% (y-o-y) capacity reduction with a 52% load factor – lowering the gap between AAL and LUV’s top line.
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Revenue Growth Southwest’s growth has been almost similar to American Airlines over the last three years, with LUV’s revenue expanding at an average rate of 3.5% per year from $20.3 billion in 2016 to $22.4 billion in 2019, versus AAL’s revenue which grew by 4.5% from $40.2 billion in 2016 to $45.8 billion in 2019. The shares of American Airlines (NASDAQ: AAL) have declined by 38% in the past year compared to a 19% drop observed in Southwest Airlines (NYSE: LUV) stock. Whereas, Southwest reported 34% (y-o-y) capacity reduction with a 52% load factor – lowering the gap between AAL and LUV’s top line.
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The shares of American Airlines (NASDAQ: AAL) have declined by 38% in the past year compared to a 19% drop observed in Southwest Airlines (NYSE: LUV) stock. Revenue Growth Southwest’s growth has been almost similar to American Airlines over the last three years, with LUV’s revenue expanding at an average rate of 3.5% per year from $20.3 billion in 2016 to $22.4 billion in 2019, versus AAL’s revenue which grew by 4.5% from $40.2 billion in 2016 to $45.8 billion in 2019. Whereas, Southwest reported 34% (y-o-y) capacity reduction with a 52% load factor – lowering the gap between AAL and LUV’s top line.
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4719.0
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2021-02-08 00:00:00 UTC
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Why Airline Shares Are Up Today
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AAL
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https://www.nasdaq.com/articles/why-airline-shares-are-up-today-2021-02-08
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nan
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nan
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What happened
Airline shares are gaining altitude on Monday on a positive day for broader markets, with travel stocks getting a boost from optimistic talk about the rollout of the COVID-19 vaccines.
Shares of Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), American Airlines Group (NASDAQ: AAL), JetBlue Airways (NASDAQ: JBLU), and Spirit Airlines (NYSE: SAVE) are leading the way, each up as much as 5% in morning trading.
So what
The airline industry was hit hard by the pandemic, which sapped demand for travel and led all the carriers to report losses in 2020. The only way to make a bull case for the industry involves a successful vaccine, and airline shares have been trading in recent months based on optimism, or pessimism, about how quickly we will be able to defeat the virus.
Image source: Getty Images.
On Monday, the stocks were aided by a bullish vaccine update from two former Food and Drug Administration commissioners, Scott Gottlieb and Mark McClellan, who wrote in The Wall Street Journal over the weekend that they expect there to be a "glut" of vaccine as soon as March. At that point, Gottlieb told CNBC on Monday morning, "we're going to have to make this generally available."
That means, in Gottlieb's words, "everyone is going to be able to go online and get an appointment sooner than we think."
That would be great news if true, both for humanity and the airlines. The best-case scenario for the sector heading into 2021 was that a quick rollout of the vaccine would clear the way for a blockbuster summer vacation season. If Gottlieb and McClellan are correct and the vaccine is widely available by April, the best-case scenario is on track toward becoming a reality.
Spirit has a route network and cost structure ready-made for luring tourists onto its planes with low fares, and should be one of the first airlines to recover should demand return in the months to come. Similarly, Southwest is well positioned to capture leisure traffic and has a history of growing its market share when times are challenging.
Delta, meanwhile, is attempting to differentiate itself by keeping middle seats open even as the rest of the industry has resumed filling its planes. A quicker-than-expected return to normalcy means that strategy -- which deprives the airline of much-needed revenue in the near term -- is less risky than it would be if the pandemic lingers into the second half of 2021.
United and American, like Delta, have full-service international networks better suited for business travelers but like JetBlue should benefit from any uptick in demand.
Now what
Airline investors are on a long journey right now, and there are no short cuts. But there is at least a general sense that the industry is heading in the right direction.
Even when passenger volumes return, it is likely to be in the price-sensitive leisure business. Higher-premium business and international flying will take well into 2022, if not longer, to return. And once the companies do turn cash-flow positive, be it in the months to come or later in 2021, their focus is going to be on repairing balance sheets bruised by raising money in 2020 to survive the crisis.
In short, while the crisis is fading there is still turbulence up ahead. Investors who want to climb aboard now will likely be rewarded in time for their patience, but given the risk and uncertainty still involved I'd recommend sticking with top operators like Delta and Southwest, or airlines like Spirit that should be well suited for the operating environment expected in the months to come.
10 stocks we like better than Delta Air Lines
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Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool owns shares of Spirit Airlines. The Motley Fool recommends Delta Air Lines, JetBlue Airways, and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), American Airlines Group (NASDAQ: AAL), JetBlue Airways (NASDAQ: JBLU), and Spirit Airlines (NYSE: SAVE) are leading the way, each up as much as 5% in morning trading. What happened Airline shares are gaining altitude on Monday on a positive day for broader markets, with travel stocks getting a boost from optimistic talk about the rollout of the COVID-19 vaccines. The only way to make a bull case for the industry involves a successful vaccine, and airline shares have been trading in recent months based on optimism, or pessimism, about how quickly we will be able to defeat the virus.
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Shares of Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), American Airlines Group (NASDAQ: AAL), JetBlue Airways (NASDAQ: JBLU), and Spirit Airlines (NYSE: SAVE) are leading the way, each up as much as 5% in morning trading. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool recommends Delta Air Lines, JetBlue Airways, and Southwest Airlines.
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Shares of Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), American Airlines Group (NASDAQ: AAL), JetBlue Airways (NASDAQ: JBLU), and Spirit Airlines (NYSE: SAVE) are leading the way, each up as much as 5% in morning trading. What happened Airline shares are gaining altitude on Monday on a positive day for broader markets, with travel stocks getting a boost from optimistic talk about the rollout of the COVID-19 vaccines. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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Shares of Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), American Airlines Group (NASDAQ: AAL), JetBlue Airways (NASDAQ: JBLU), and Spirit Airlines (NYSE: SAVE) are leading the way, each up as much as 5% in morning trading. United and American, like Delta, have full-service international networks better suited for business travelers but like JetBlue should benefit from any uptick in demand. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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4720.0
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2021-02-08 00:00:00 UTC
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EXCLUSIVE-Congressional Democrats set to back more than $50 billion for transportation sector
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AAL
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https://www.nasdaq.com/articles/exclusive-congressional-democrats-set-to-back-more-than-%2450-billion-for-transportation-0
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter.
The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says. U.S. House committees are set to vote on the legislation on Wednesday.
Airline stocks rose sharply on news of the new funding, with American Airlines AAL.Oup 4.2%, while United Airlines UAL.Ogained 5% and Southwest Airlines LUV.Njumped nearly 6%.
President Joe Biden had proposed $20 billion for struggling U.S. transit agencies - and nothing for airlines - while Democrats had pushed for more transit help, citing the collapse in travel demand as a result of the COVID-19 pandemic.
Transit agencies have previously been awarded $39 billion in emergency assistance by Congress. New York's Metropolitan Transit Agency says daily subway travel has recently been down 70% or more.
U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires. The additional $14 billion will keeping nearly 30,000 airline workers on the job through Sept. 30.
A summary of the $14 billion airline payroll proposal from the House Financial Services Committee seen by Reuters noted airlines lost over $35 billion in 2020 and "airlines do not expect to return to profitability until midway through 2021.
The $3 billion aviation manufacturing program would provide a 50% government subsidy to cover costs of pay, benefits and training for employees at risk of being furloughed or who were furloughed due to the pandemic. The grants cover up to 25% of a company's U.S. workforce.
U.S. airplane manufacturer Boeing and suppliers have cut thousands of manufacturing jobs over the last year as demand for new planes has shrunk amid the collapse in airline travel.
Boeing said last year it recorded severance costs for 26,000 employees in 2020, with 18,000 having left last year and the remainder expected leave in 2021. Boeing did not immediately comment on the program.
International Association of Machinists and Aerospace Workers (IAM) President Robert Martinez urged lawmakers to back the effort to provide payroll assistance to "help this critical workforce and supply chain weather the storm of this historic pandemic."
(Reporting by David Shepardson, Editing by Franklin Paul and Dan Grebler)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Airline stocks rose sharply on news of the new funding, with American Airlines AAL.Oup 4.2%, while United Airlines UAL.Ogained 5% and Southwest Airlines LUV.Njumped nearly 6%. By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires.
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Airline stocks rose sharply on news of the new funding, with American Airlines AAL.Oup 4.2%, while United Airlines UAL.Ogained 5% and Southwest Airlines LUV.Njumped nearly 6%. By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says.
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Airline stocks rose sharply on news of the new funding, with American Airlines AAL.Oup 4.2%, while United Airlines UAL.Ogained 5% and Southwest Airlines LUV.Njumped nearly 6%. By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says.
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Airline stocks rose sharply on news of the new funding, with American Airlines AAL.Oup 4.2%, while United Airlines UAL.Ogained 5% and Southwest Airlines LUV.Njumped nearly 6%. By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. Transit agencies have previously been awarded $39 billion in emergency assistance by Congress.
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4721.0
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2021-02-08 00:00:00 UTC
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EXCLUSIVE-Congressional Democrats set to back more than $50 billion for transportation sector
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AAL
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https://www.nasdaq.com/articles/exclusive-congressional-democrats-set-to-back-more-than-%2450-billion-for-transportation
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are set to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a new $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter.
The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says. U.S. House committees are set to vote on the legislation on Wednesday.
President Joe Biden had proposed $20 billion for struggling U.S. transit agencies, while Democrats had pushed for more, citing the collapse in travel demand as a result of the COVID-19 pandemic.
U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires. The additional $14 billion will keeping nearly 30,000 airline workers on the job through Sept. 30.
The $3 billion aviation manufacturing program would provide a 50% government subsidy to cover costs of pay, benefits and training for employees at risk of being furloughed or who were furloughed due to the pandemic.
U.S. airplane manufacturer Boeing and suppliers have cut thousands of manufacturing jobs over the last year as demand for new planes has shrunk amid the collapse in airline travel.
(Reporting by David Shepardson, Editing by Franklin Paul and Dan Grebler)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are set to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a new $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. President Joe Biden had proposed $20 billion for struggling U.S. transit agencies, while Democrats had pushed for more, citing the collapse in travel demand as a result of the COVID-19 pandemic. U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires.
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By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are set to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a new $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says. U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires.
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By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are set to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a new $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says. U.S. airlines have been awarded $40 billion in payroll support since March and airline unions had asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round of funding expires.
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By David Shepardson WASHINGTON, Feb 8 (Reuters) - Democrats in the U.S. Congress are set to release a sweeping plan on Monday to provide more than $50 billion in additional assistance to U.S. airlines, transit systems, airports and passenger railroad Amtrak and create a new $3 billion program to assist aviation manufacturers with payroll costs, according to documents seen by Reuters and sources briefed on the matter. The $1.9 trillion COVID-19 relief proposal will provide $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak, the draft legislation says. The additional $14 billion will keeping nearly 30,000 airline workers on the job through Sept. 30.
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4722.0
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2021-02-08 00:00:00 UTC
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INSIGHT-Once a 'stonk,' Hertz reveals dilemma companies face in Reddit frenzy
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AAL
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https://www.nasdaq.com/articles/insight-once-a-stonk-hertz-reveals-dilemma-companies-face-in-reddit-frenzy-2021-02-08
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nan
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nan
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By Jessica DiNapoli, Mike Spector and Koh Gui Qing
NEW YORK, Feb 8 (Reuters) - Months before the irrational trading in GameStop Corp GME.N, there was Hertz Global Holdings Inc HTZGQ.PK.
Operating under bankruptcy protection last spring once the COVID-19 pandemic wiped out its business, the car-rental giant confronted an extraordinary situation: Its stock price was skyrocketing for no apparent reason.
Conversations at the time among Hertz management and directors on its board, reported here for the first time, turned from shock to a vigorous debate about whether the company should capitalize on its unexpected good fortune and sell shares to fund itself during bankruptcy proceedings, according to three people familiar with the deliberations.
Raising money through a share sale would be less expensive for Hertz, which was bleeding cash as travel and car rentals plunged, than tapping a costly bankruptcy loan that most companies in its situation use to navigate court restructurings.
Directors keen on selling shares fended off concerns from some in Hertz’s C-suite and boardroom that such a move risked misleading investors who failed to appreciate that creditors are always paid first in bankruptcy, two of the sources said.
Shareholders, on the other hand, usually lose their shirts.
But Hertz abandoned its plan to sell up to $500 million in new shares after the U.S. Securities and Exchange Commission (SEC) started scrutinizing it. Hertz declined to comment.
Over the past few weeks, soaring stock prices of GameStop - along with movie theater chain AMC Entertainment Holdings Inc AMC.N, home goods retailer Bed, Bath & Beyond Inc BBBY.O and other companies - on the back of Reddit memes and YouTube videos have put company leaders in a similar situation.
The internal Hertz deliberations offer a window into the contours of the ethical and regulatory dilemmas they face. Namely, can they sell stock to raise capital in such a volatile market?
Regulators are watching. The acting head of the SEC has said in recent days that the agency is looking closely at how companies are behaving, including whether they are trying to raise money and adequately disclosing risks associated with it to investors.
"Taking advantage of what could potentially be a manipulated market would trigger both reputational and legal concerns,” said Donald Langevoort, a Georgetown University Law Center professor and former SEC attorney.
The SEC declined to comment.
DIFFERENT APPROACHES
As a social-media-fueled retail trading frenzy has whipsawed a series of "stonks" - a Reddit meme for stocks - over the past few weeks, the companies in the eye of the storm have largely kept quiet. But three sources familiar with some of these companies said discussions about surging shares are taking place in their C-suites and boardrooms as well.
Unlike Hertz, these companies are not under bankruptcy protection. So far, they are taking different approaches.
GameStop, whose shares slumped as much as 84% in the first week of February after surging more than 25-fold the previous month, has paperwork lined up to sell $100 million worth of new equity but has not yet disclosed whether it has done so. American Airlines Group Inc AAL.O pulled the trigger on a plan to sell more than $1 billion of stock after its shares recently rallied as much as 48%.
GameStop and American declined to comment.
AMC, which previously warned it could file for bankruptcy after the pandemic temporarily closed its cinemas, has raised roughly $1.2 billion through debt and equity deals. It is now racing to file papers with regulators to sell shares possibly worth hundreds of millions of dollars more, two people familiar with the matter said.
"A company would be silly not to” consider selling additional shares, one source close to AMC said. "Any company that is thinking seriously would want to talk it through and decide what strategies are available.”
AMC did not respond to a request for comment. In late January, Chief Executive Adam Aron said recent fundraising meant “any talk of an imminent bankruptcy for AMC is completely off the table.”
BEFUDDLED BOARD
That was the dilemma Hertz faced last spring. The company filed for bankruptcy last May, crumbling under roughly $19 billion of debt as the pandemic decimated its business.
Roughly two weeks later, Hertz shares vaulted nearly 16 times to a high of $6.25, almost unheard of at the time for any company, let alone one under bankruptcy protection. Directors, executives and company advisers were befuddled, three sources familiar with the matter said. Calling around, there were no signs that a hedge fund or other large institutional investor was buying shares, one of the sources said.
An adviser talked with an investor who suggested the trading app Robinhood was behind the unexpected rise, the source said. Indeed, Hertz was among the platform’s most popular stocks. “Hertz bankruptcy is CANCELLED by Robinhood ‘investors,’” a Reddit commenter called “itsnotshade” wrote at the time. “Good job guys.”
Some Hertz directors saw an opportunity to bolster its cash coffers with a stock sale. But some in the management, along with other directors, pushed back over concerns the shares were virtually worthless and any offering would take advantage of small-time investors unfamiliar with bankruptcy law, the sources familiar with the discussions at the time said.
Directors favoring a share sale countered that, while rare, shareholders sometimes receive payouts in bankruptcy cases, one of the sources said. Shares of other companies under bankruptcy protection, such as J.C. Penney Co Inc and Whiting Petroleum Corp WLL.N, were also spiking at the time.
Eventually, the board decided to proceed with selling shares. On June 12, U.S. Bankruptcy Judge Mary Walrath approved Hertz’s plan to sell new shares. In court filings, Hertz touted that it would not have to repay the money and that the move was better for its creditors.
Hertz alerted the SEC and warned prospective buyers they would likely lose all their money.
But the deal was done before it started. In a television interview, then-SEC Chairman Jay Clayton said the agency had informed Hertz it had “comments” on the stock offering, and that most companies do not go forward after hearing from the regulator until the issues are resolved. Reuters could not determine the content of the SEC's feedback on the offering.
The next day, Hertz, not wanting to antagonize regulators, pulled the offering, two of the sources said.
(Reporting by Jessica DiNapoli, Mike Spector and Koh Gui Qing; Editing by Paritosh Bansal and Edward Tobin)
((Jessica.DiNapoli@thomsonreuters.com; 646-223-4678;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc AAL.O pulled the trigger on a plan to sell more than $1 billion of stock after its shares recently rallied as much as 48%. By Jessica DiNapoli, Mike Spector and Koh Gui Qing NEW YORK, Feb 8 (Reuters) - Months before the irrational trading in GameStop Corp GME.N, there was Hertz Global Holdings Inc HTZGQ.PK. Raising money through a share sale would be less expensive for Hertz, which was bleeding cash as travel and car rentals plunged, than tapping a costly bankruptcy loan that most companies in its situation use to navigate court restructurings.
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American Airlines Group Inc AAL.O pulled the trigger on a plan to sell more than $1 billion of stock after its shares recently rallied as much as 48%. By Jessica DiNapoli, Mike Spector and Koh Gui Qing NEW YORK, Feb 8 (Reuters) - Months before the irrational trading in GameStop Corp GME.N, there was Hertz Global Holdings Inc HTZGQ.PK. AMC, which previously warned it could file for bankruptcy after the pandemic temporarily closed its cinemas, has raised roughly $1.2 billion through debt and equity deals.
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American Airlines Group Inc AAL.O pulled the trigger on a plan to sell more than $1 billion of stock after its shares recently rallied as much as 48%. Conversations at the time among Hertz management and directors on its board, reported here for the first time, turned from shock to a vigorous debate about whether the company should capitalize on its unexpected good fortune and sell shares to fund itself during bankruptcy proceedings, according to three people familiar with the deliberations. Directors keen on selling shares fended off concerns from some in Hertz’s C-suite and boardroom that such a move risked misleading investors who failed to appreciate that creditors are always paid first in bankruptcy, two of the sources said.
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American Airlines Group Inc AAL.O pulled the trigger on a plan to sell more than $1 billion of stock after its shares recently rallied as much as 48%. Conversations at the time among Hertz management and directors on its board, reported here for the first time, turned from shock to a vigorous debate about whether the company should capitalize on its unexpected good fortune and sell shares to fund itself during bankruptcy proceedings, according to three people familiar with the deliberations. The SEC declined to comment.
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4723.0
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2021-02-05 00:00:00 UTC
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U.S. lawmaker: airline payroll assistance will be part of COVID-19 measure
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AAL
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https://www.nasdaq.com/articles/u.s.-lawmaker%3A-airline-payroll-assistance-will-be-part-of-covid-19-measure-2021-02-05-0
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 5 (Reuters) - A senior U.S. House lawmaker told reporters that a COVID-19 relief package would include a new round of payroll assistance for U.S. airline workers.
Representative Peter DeFazio, who chairs the House Transportation and Infrastructure Committee, told reporters at the White House the new round of airline government assistance would extend restrictions on executive compensation and stock buybacks.
U.S. airlines have been awarded $40 billion in payroll support since March and airline unions last week asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round expires.
Reuters reported Thursday that Democratic leaders in Congress are likely to back $14 billion to extend airline payroll support for six months, keeping nearly 30,000 airline workers on the job.
Flight attendant union leader Sara Nelson said Thursday that $14 billion was being discussed for airlines and $1 billion for contractors. "Congress has to come up with more funds to support these workers," Nelson said.
U.S. Transportation Secretary Pete Buttigieg told Reuters on Thursday there are "very active" conversations between the White House, Congress and stakeholders about including additional assistance to the struggling transportation sector, which has sought more than $130 billion in a COVID-19 relief bill.
President Joe Biden’s $1.9 trillion proposal includes only $20 billion for transit systems.
Bus and ferry companies want $40 billion, state transportation departments sought $18 billion and airports want $17 billion and public transit has asked for $39.3 billion.
Amtrak Chief Executive Bill Flynn told reporters Friday that the passenger railroad could "fully restore" daily long-distance train service up from the current three days a week and recall furloughed workers if it receives the $1.5 billion in new funding it sought.
American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees.
(Reporting by David Shepardson; Editing by Kirsten Donovan)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. By David Shepardson WASHINGTON, Feb 5 (Reuters) - A senior U.S. House lawmaker told reporters that a COVID-19 relief package would include a new round of payroll assistance for U.S. airline workers. U.S. Transportation Secretary Pete Buttigieg told Reuters on Thursday there are "very active" conversations between the White House, Congress and stakeholders about including additional assistance to the struggling transportation sector, which has sought more than $130 billion in a COVID-19 relief bill.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. By David Shepardson WASHINGTON, Feb 5 (Reuters) - A senior U.S. House lawmaker told reporters that a COVID-19 relief package would include a new round of payroll assistance for U.S. airline workers. Representative Peter DeFazio, who chairs the House Transportation and Infrastructure Committee, told reporters at the White House the new round of airline government assistance would extend restrictions on executive compensation and stock buybacks.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. U.S. airlines have been awarded $40 billion in payroll support since March and airline unions last week asked Congress for another $15 billion to keep thousands of workers on the payroll past March 31, when the current round expires. Reuters reported Thursday that Democratic leaders in Congress are likely to back $14 billion to extend airline payroll support for six months, keeping nearly 30,000 airline workers on the job.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. By David Shepardson WASHINGTON, Feb 5 (Reuters) - A senior U.S. House lawmaker told reporters that a COVID-19 relief package would include a new round of payroll assistance for U.S. airline workers. "Congress has to come up with more funds to support these workers," Nelson said.
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4724.0
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2021-02-05 00:00:00 UTC
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ANALYSIS-The other winners of the Reddit-fueled rallies: convertible debt
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AAL
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https://www.nasdaq.com/articles/analysis-the-other-winners-of-the-reddit-fueled-rallies%3A-convertible-debt-2021-02-05
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nan
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nan
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By Kate Duguid and Matt Scuffham
NEW YORK, Feb 5 (Reuters) - Among the winners from the recent retail-driven frenzy in U.S. stocks are investors in the niche market of convertible debt, capping a year of gains for the securities and potentially drawing new interest.
While buyout firm Silver Lake capitalized on a surge in AMC Entertainment AMC.N, one of the stocks at the epicenter of the retail frenzy linked to a convertible bond, others have also seen their bonds gain.
Those holding convertible notes - which allow investors to convert the debt to equity when a company's shares hit a set price - in Ligand Pharmaceuticals LGND.O, 53220KAF5=, 53220KAE8= have seen prices rise 10% since Jan. 25. Over the same period, the American Airlines AAL.O, 02376RAF9= convertible note rose to a record high, as did that of First Majestic Silver FR.TO, 32076VAA1=, 32076VAB9=, last up 9% and 14% respectively. All three stocks were pushed higher in the retail buying rush.
"This is why you buy convertibles," said Geoff Dancey, portfolio manager at Cutler Capital Management, who bought into the Ligand convertible bond just before the Reddit rally.
"We are benefiting from the rise, the same way as equity investors," said Arnaud Brillois, who manages the global convertible portfolio at Lazard Asset Management. He noted that not all stocks that rose last week are linked to convertible bonds, which allow investors to gain from dramatic jumps in share prices but also pay a coupon like a traditional bond.
"When you have a stock going up, the convertible bond is going to capture a large part of the equity's rise," said Brillois. "The convertible bond will perform approximately 950% or 970% when the equity is doing 1000%."
Two hedge fund investors who requested anonymity because they could not speak publicly about their positions said the market volatility also provided hedge funds with an opportunity to profit. They buy the convertible bonds of companies whose stock has soared and hedge their position by shorting the shares.
"This (retail) development has spurred a whole group of funds to adopt that strategy," said a source who runs a U.S. hedge fund.
That arbitrage strategy - which takes advantage of differences in price between the debt and equity - has been utilized by funds like CQS, AQR Capital Management, Man Group and Whitebox Advisors, among others.
Last week's market mania "benefited the private equity firms or whoever owned the bonds greatly; it benefited the company because they don't have to pay back the debt, and it probably did not benefit whoever it was that was buying up that stock that hit crazy levels," said Todd Pulvino, co-founder of CNH Partners, an affiliate of AQR that trades convertible arbitrage.
Gil Song, portfolio manager at Man GLG, said large, unexpected moves in stocks that benefit convertible arbitrage investors may become more common.
"Given recent estimates of retail participation in the market having doubled in the past two years alone, one might infer increased volatility is here to stay for at least some time," said Song.
Whitebox Advisors declined to comment and CQS did not respond to a request for comment.
While the Reddit rally has shown signs of weakening, two of the largest exchange-traded funds that track the convertible market, the iShares Convertible Bond ETF ICVT.Z and the SPDR Bloomberg Barclays Convertible Securities ETF CWB.P, hit all-time highs on Friday morning.
(Reporting by Kate Duguid and Matt Scuffham; Editing by Megan Davies and Dan Grebler)
((kate.duguid@thomsonreuters.com; +646-223-6118; Reuters Messaging: kate.duguid@thomsonreuters.com@thomsonreuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Over the same period, the American Airlines AAL.O, 02376RAF9= convertible note rose to a record high, as did that of First Majestic Silver FR.TO, 32076VAA1=, 32076VAB9=, last up 9% and 14% respectively. By Kate Duguid and Matt Scuffham NEW YORK, Feb 5 (Reuters) - Among the winners from the recent retail-driven frenzy in U.S. stocks are investors in the niche market of convertible debt, capping a year of gains for the securities and potentially drawing new interest. That arbitrage strategy - which takes advantage of differences in price between the debt and equity - has been utilized by funds like CQS, AQR Capital Management, Man Group and Whitebox Advisors, among others.
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Over the same period, the American Airlines AAL.O, 02376RAF9= convertible note rose to a record high, as did that of First Majestic Silver FR.TO, 32076VAA1=, 32076VAB9=, last up 9% and 14% respectively. Those holding convertible notes - which allow investors to convert the debt to equity when a company's shares hit a set price - in Ligand Pharmaceuticals LGND.O, 53220KAF5=, 53220KAE8= have seen prices rise 10% since Jan. 25. That arbitrage strategy - which takes advantage of differences in price between the debt and equity - has been utilized by funds like CQS, AQR Capital Management, Man Group and Whitebox Advisors, among others.
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Over the same period, the American Airlines AAL.O, 02376RAF9= convertible note rose to a record high, as did that of First Majestic Silver FR.TO, 32076VAA1=, 32076VAB9=, last up 9% and 14% respectively. Those holding convertible notes - which allow investors to convert the debt to equity when a company's shares hit a set price - in Ligand Pharmaceuticals LGND.O, 53220KAF5=, 53220KAE8= have seen prices rise 10% since Jan. 25. Last week's market mania "benefited the private equity firms or whoever owned the bonds greatly; it benefited the company because they don't have to pay back the debt, and it probably did not benefit whoever it was that was buying up that stock that hit crazy levels," said Todd Pulvino, co-founder of CNH Partners, an affiliate of AQR that trades convertible arbitrage.
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Over the same period, the American Airlines AAL.O, 02376RAF9= convertible note rose to a record high, as did that of First Majestic Silver FR.TO, 32076VAA1=, 32076VAB9=, last up 9% and 14% respectively. He noted that not all stocks that rose last week are linked to convertible bonds, which allow investors to gain from dramatic jumps in share prices but also pay a coupon like a traditional bond. They buy the convertible bonds of companies whose stock has soared and hedge their position by shorting the shares.
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4725.0
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2021-02-04 00:00:00 UTC
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American Airlines Planning To Furlough Up To 13,000 Employees – Report
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AAL
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https://www.nasdaq.com/articles/american-airlines-planning-to-furlough-up-to-13000-employees-report-2021-02-04
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nan
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nan
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American Airlines confirmed on Wednesday that 13,000 of its employees were at risk of furlough as the coronavirus pandemic continues to ravage the aviation industry, according to Reuters.
A U.S. aid package for airline workers expires on April 1, and American Airlines (AAL) finds itself “in a situation similar to much of 2020,” said CEO Doug Parker and President Robert Isom in a memo to employees, which was also included in a regulatory filing.
“The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have dampened demand,” Parker and Isom added.
Reuters reports that American Airlines will offer their employees, including 1,850 pilots and 4,245 flight attendants, voluntary exit packages in the hope that it will ease the possibility of involuntary retrenchments.
American Airlines reported its financial results for 2020 last week, posting a full-year net loss of around $9 billion. In an attempt to boost liquidity, the airline company took advantage of the sharp rise in its share price due to the WallStreetBets inspired short squeeze and launched a $1 billion stock sale. (See American Airlines stock analysis on TipRanks)
Seaport Global analyst Daniel Mckenzie downgraded American Airlines three days ago from Buy to Hold and withdrew his price target.
"Our conviction in the recovery story doesn't change, but given limited upside to our $19 target price, risk reward is balanced given COVID variants that slow the int'l revenue recovery and cause us to trim our pre-tax earnings outlook. Hence our move to the sidelines today; downgrading to Neutral (from Buy) and withdrawing our target price," Mckenzie explained.
Consensus among analysts is a Moderate Sell based on 1 Buy, 5 Holds and 7 Sells. The average analyst price target of $14.14 suggests downside potential of 20% over the next 12 months.
Hedge Fund Activity for AAL decreased substantially over the last quarter, with a significant reduction in holdings and a Very Negative Confidence Signal.
Related News:
Biogen’s 4Q Earnings Miss Estimates, Shares Fall 5.2%
Digital Turbine Posts Blowout Quarter; Shares Pop 15%
Vaxart Tanks 58% On Oral COVID-19 Vaccine Early Trial Data; Street Says Buy
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A U.S. aid package for airline workers expires on April 1, and American Airlines (AAL) finds itself “in a situation similar to much of 2020,” said CEO Doug Parker and President Robert Isom in a memo to employees, which was also included in a regulatory filing. Hedge Fund Activity for AAL decreased substantially over the last quarter, with a significant reduction in holdings and a Very Negative Confidence Signal. “The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have dampened demand,” Parker and Isom added.
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A U.S. aid package for airline workers expires on April 1, and American Airlines (AAL) finds itself “in a situation similar to much of 2020,” said CEO Doug Parker and President Robert Isom in a memo to employees, which was also included in a regulatory filing. Hedge Fund Activity for AAL decreased substantially over the last quarter, with a significant reduction in holdings and a Very Negative Confidence Signal. Reuters reports that American Airlines will offer their employees, including 1,850 pilots and 4,245 flight attendants, voluntary exit packages in the hope that it will ease the possibility of involuntary retrenchments.
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A U.S. aid package for airline workers expires on April 1, and American Airlines (AAL) finds itself “in a situation similar to much of 2020,” said CEO Doug Parker and President Robert Isom in a memo to employees, which was also included in a regulatory filing. Hedge Fund Activity for AAL decreased substantially over the last quarter, with a significant reduction in holdings and a Very Negative Confidence Signal. (See American Airlines stock analysis on TipRanks) Seaport Global analyst Daniel Mckenzie downgraded American Airlines three days ago from Buy to Hold and withdrew his price target.
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A U.S. aid package for airline workers expires on April 1, and American Airlines (AAL) finds itself “in a situation similar to much of 2020,” said CEO Doug Parker and President Robert Isom in a memo to employees, which was also included in a regulatory filing. Hedge Fund Activity for AAL decreased substantially over the last quarter, with a significant reduction in holdings and a Very Negative Confidence Signal. “The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have dampened demand,” Parker and Isom added.
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4726.0
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2021-02-04 00:00:00 UTC
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Buttigieg: Talks ongoing on additional U.S. transportation sector assistance
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AAL
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https://www.nasdaq.com/articles/buttigieg%3A-talks-ongoing-on-additional-u.s.-transportation-sector-assistance-2021-02-04
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nan
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nan
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By David Shepardson
WASHINGTON, Feb 4 (Reuters) - New U.S. Transportation Secretary Pete Buttigieg told Reuters on Thursday there are "very active" conversations between the White House, Congress and stakeholders about including assistance to the struggling transportation sector, which has sought more than $130 billion in a COVID-19 relief bill.
President Joe Biden’s $1.9 trillion proposal includes only $20 billion for public transit systems.
Airline unions are seeking $15 billion in payroll assistance while bus and ferry companies want $40 billion, state transportation departments have asked for $18 billion, Amtrak wants $1.5 billion, airports want $17 billion and public transit has asked for $39.3 billion.
"They should be all taken seriously because this is about making sure we get the transportation sector back on its feet," Buttigieg said in a phone interview. "Just about everybody needs help getting back to pre-COVID levels."
Buttigieg referred to Biden's $20 billion transit proposal as the "initial conversations but those conversations are ongoing because we do want to make sure we're supporting a robust return for the sector and supporting workers."
Democratic leaders in Congress are likely to back $14 billion to extend the airline payroll support program for six months which would keep nearly 30,000 airline workers after the existing program expires on March 30 as well as additional funding for the sector, congressional aides and industry officials say.
Sara Nelson, president of the Association of Flight Attendants-CWA representing workers at 17 airlines, confirmed at a House Transportation and Infrastructure hearing on Thursday that $14 billion was being discussed for airlines and $1 billion for contractors.
"Congress has to come up with more funds to support these workers," Nelson said. "It is urgent that we get this done."
Asked if Biden supports new airline assistance, White House spokeswoman Jen Psaki told reporters on Thursday, "the priorities of the president are already in the bill," but added it could change as Congress debates it.
House Transportation Committee Chairman Peter DeFazio referenced Psaki's comments and said he has been "very vocal" about the need for new funding for airline workers, transit, private bus companies, contractors and others.
"Congress is an independent entity so we are going to accomplish (Biden's) goals and some of our own," DeFazio added.
American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees.
Congress previously approved $40 billion in two rounds of prior payroll support.
Buttigieg said government needs to rebuild the transportation sector post-COVID-19 "with an eye to the future because every form of travel is evolving and the 2020s specifically I think will be a decade that has some of the swiftest changes and transformations that we've seen really in modern times."
(Reporting by David Shepardson in Washington Editing by Leslie Adler and Matthew Lewis)
((David.Shepardson@thomsonreuters.com +1 202 898-8324))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. Asked if Biden supports new airline assistance, White House spokeswoman Jen Psaki told reporters on Thursday, "the priorities of the president are already in the bill," but added it could change as Congress debates it. House Transportation Committee Chairman Peter DeFazio referenced Psaki's comments and said he has been "very vocal" about the need for new funding for airline workers, transit, private bus companies, contractors and others.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. By David Shepardson WASHINGTON, Feb 4 (Reuters) - New U.S. Transportation Secretary Pete Buttigieg told Reuters on Thursday there are "very active" conversations between the White House, Congress and stakeholders about including assistance to the struggling transportation sector, which has sought more than $130 billion in a COVID-19 relief bill. Airline unions are seeking $15 billion in payroll assistance while bus and ferry companies want $40 billion, state transportation departments have asked for $18 billion, Amtrak wants $1.5 billion, airports want $17 billion and public transit has asked for $39.3 billion.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. By David Shepardson WASHINGTON, Feb 4 (Reuters) - New U.S. Transportation Secretary Pete Buttigieg told Reuters on Thursday there are "very active" conversations between the White House, Congress and stakeholders about including assistance to the struggling transportation sector, which has sought more than $130 billion in a COVID-19 relief bill. Airline unions are seeking $15 billion in payroll assistance while bus and ferry companies want $40 billion, state transportation departments have asked for $18 billion, Amtrak wants $1.5 billion, airports want $17 billion and public transit has asked for $39.3 billion.
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American Airlines AAL.O on Wednesday said 13,000 employees are at risk of furlough starting on April 1 ; United Airlines UAL.O sent new furlough warnings to 14,000 employees. Airline unions are seeking $15 billion in payroll assistance while bus and ferry companies want $40 billion, state transportation departments have asked for $18 billion, Amtrak wants $1.5 billion, airports want $17 billion and public transit has asked for $39.3 billion. "Congress has to come up with more funds to support these workers," Nelson said.
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4727.0
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2021-02-04 00:00:00 UTC
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American Airlines Warns 13,000 Employees Of Furloughs
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AAL
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https://www.nasdaq.com/articles/american-airlines-warns-13000-employees-of-furloughs-2021-02-04
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nan
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nan
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(RTTNews) - American Airlines Inc. will send notices beginning Friday to around 13,000 U.S.- based employees regarding possible furloughs, according to a filing with the U.S. Securities and Exchange Commission.
In a letter to employees, the struggling airline said it is forced to take action due to the expiration of the U.S. Government's Payroll Support Program or PSP on April 1 amid the weak travel demand as the pandemic crisis continues. Any job impact will take effect on or after April 1.
The company said it supports union partners who are urging Congress for an extension of the PSP through September 30 of this year.
Chief Executive Doug Parker and President Robert Isom said in a memo to employees, "We are nearly five weeks into 2021, and unfortunately, we find ourselves in a situation similar to much of 2020. As we closed out last year with the successful extension of the Payroll Support Program, we fully believed that we would be looking at a summer schedule where we'd fly all of our airplanes and need the full strength of our team. Regrettably, that is no longer the case."
American expects to fly at least 45 percent less in the first quarter compared to that of last year. Based on current demand outlook, the company will not fly all of its aircraft this summer as planned, and will have more team members than the schedule requires after federal payroll support expires on April 1.
The company said the travel demand is continuing to be hurt by slower-than-expected vaccine distribution and new restrictions on international travel that require customers to have a negative COVID-19 test.
American Airlines said it will send Worker Adjustment and Retraining Notification or WARN notices to these employees, as required by law in advance of potential furloughs in certain locations.
As per the filing, the furlough notices will be given to 1,850 pilots; 4,245 flight attendants; 3,145 fleet service workers; 1,420 maintenance workers; 1,205 in passenger service; 100 dispatchers; and 40 Flight Crew Training instructors.
The company also announced a voluntary early out program and a long-term voluntary leave of absence program for frontline, U.S.-based team members, excluding pilots.
Rival United Airlines Holdings Inc. has recently issued furlough warnings to its 14,000 employees.
Both companies had furloughed thousands of their workers last year when the first round of federal payroll support ended on October 1.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In a letter to employees, the struggling airline said it is forced to take action due to the expiration of the U.S. Government's Payroll Support Program or PSP on April 1 amid the weak travel demand as the pandemic crisis continues. Based on current demand outlook, the company will not fly all of its aircraft this summer as planned, and will have more team members than the schedule requires after federal payroll support expires on April 1. American Airlines said it will send Worker Adjustment and Retraining Notification or WARN notices to these employees, as required by law in advance of potential furloughs in certain locations.
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In a letter to employees, the struggling airline said it is forced to take action due to the expiration of the U.S. Government's Payroll Support Program or PSP on April 1 amid the weak travel demand as the pandemic crisis continues. Based on current demand outlook, the company will not fly all of its aircraft this summer as planned, and will have more team members than the schedule requires after federal payroll support expires on April 1. As per the filing, the furlough notices will be given to 1,850 pilots; 4,245 flight attendants; 3,145 fleet service workers; 1,420 maintenance workers; 1,205 in passenger service; 100 dispatchers; and 40 Flight Crew Training instructors.
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In a letter to employees, the struggling airline said it is forced to take action due to the expiration of the U.S. Government's Payroll Support Program or PSP on April 1 amid the weak travel demand as the pandemic crisis continues. Based on current demand outlook, the company will not fly all of its aircraft this summer as planned, and will have more team members than the schedule requires after federal payroll support expires on April 1. American Airlines said it will send Worker Adjustment and Retraining Notification or WARN notices to these employees, as required by law in advance of potential furloughs in certain locations.
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As we closed out last year with the successful extension of the Payroll Support Program, we fully believed that we would be looking at a summer schedule where we'd fly all of our airplanes and need the full strength of our team. Based on current demand outlook, the company will not fly all of its aircraft this summer as planned, and will have more team members than the schedule requires after federal payroll support expires on April 1. American Airlines said it will send Worker Adjustment and Retraining Notification or WARN notices to these employees, as required by law in advance of potential furloughs in certain locations.
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4728.0
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2021-02-04 00:00:00 UTC
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Anglo American to provide $30 million to support COVID-19 vaccine rollout
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AAL
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https://www.nasdaq.com/articles/anglo-american-to-provide-%2430-million-to-support-covid-19-vaccine-rollout-2021-02-04
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Anglo to give $10 mln support to South Africa's vaccine rollout
South Africa received first vaccines on Monday
Mining industry expects vaccine rollout to cost $20 mln
JOHANNESBURG, Feb 4 (Reuters) - Anglo American AAL.L said on Thursday it would provide up to $30 million to support the rollout of COVID-19 vaccines across its global operations, with $10 million allocated to assist South Africa in its vaccination efforts.
South Africa, which has recorded the highest number of coronavirus infections and deaths on the African continent at more than 1.4 million cases and over 45,000 deaths, received its first doses of COVID-19 vaccine on Monday.
"The more of us that are vaccinated, the safer we will all be and the more quickly we can help rebuild our economies.” said Anglo American Chief Executive Mark Cutifani.
The company said contributions to other countries where it has operations, including Australia, Brazil, Peru, India, and China, would differ depending on each country's needs and vaccine deployment model.
In South Africa the funds will be used to assist the government in the purchase of vaccines via the Solidarity Fund, which is a public and private relief fund set up to help fight COVID-19, to support transportation and storage, train community health workers and through the use of its health facilities.
The Minerals Council South Africa, which represents mining firms, offered its financial and logistical assistance after the government called for the private sector to help with the rollout of vaccines.
The cost of the vaccine programme to the industry could be around 300 million rand ($20 million), the Minerals Council said.
The National Treasury estimates it could cost up to 24 billion rand to vaccinate South Africa's target of 40 million people, or two-thirds of the population.
Mining companies say they are well placed to support the COVID-19 response thanks to on-site treatment facilities and decades of experience combating infectious diseases.
Anglo American aims to vaccinate its 45,000 workforce, their families and surrounding communities in South Africa.
($1 = 15.0139 rand)
(Reporting by Tanisha Heiberg; Editing by Olivia Kumwenda-Mtambo and Chizu Nomiyama)
((Tanisha.Heiberg@thomsonreuters.com; +27117753034; Reuters Messaging: tanisha.heiberg.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Anglo to give $10 mln support to South Africa's vaccine rollout South Africa received first vaccines on Monday Mining industry expects vaccine rollout to cost $20 mln JOHANNESBURG, Feb 4 (Reuters) - Anglo American AAL.L said on Thursday it would provide up to $30 million to support the rollout of COVID-19 vaccines across its global operations, with $10 million allocated to assist South Africa in its vaccination efforts. The Minerals Council South Africa, which represents mining firms, offered its financial and logistical assistance after the government called for the private sector to help with the rollout of vaccines. The National Treasury estimates it could cost up to 24 billion rand to vaccinate South Africa's target of 40 million people, or two-thirds of the population.
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Anglo to give $10 mln support to South Africa's vaccine rollout South Africa received first vaccines on Monday Mining industry expects vaccine rollout to cost $20 mln JOHANNESBURG, Feb 4 (Reuters) - Anglo American AAL.L said on Thursday it would provide up to $30 million to support the rollout of COVID-19 vaccines across its global operations, with $10 million allocated to assist South Africa in its vaccination efforts. The Minerals Council South Africa, which represents mining firms, offered its financial and logistical assistance after the government called for the private sector to help with the rollout of vaccines. The cost of the vaccine programme to the industry could be around 300 million rand ($20 million), the Minerals Council said.
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Anglo to give $10 mln support to South Africa's vaccine rollout South Africa received first vaccines on Monday Mining industry expects vaccine rollout to cost $20 mln JOHANNESBURG, Feb 4 (Reuters) - Anglo American AAL.L said on Thursday it would provide up to $30 million to support the rollout of COVID-19 vaccines across its global operations, with $10 million allocated to assist South Africa in its vaccination efforts. In South Africa the funds will be used to assist the government in the purchase of vaccines via the Solidarity Fund, which is a public and private relief fund set up to help fight COVID-19, to support transportation and storage, train community health workers and through the use of its health facilities. The Minerals Council South Africa, which represents mining firms, offered its financial and logistical assistance after the government called for the private sector to help with the rollout of vaccines.
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Anglo to give $10 mln support to South Africa's vaccine rollout South Africa received first vaccines on Monday Mining industry expects vaccine rollout to cost $20 mln JOHANNESBURG, Feb 4 (Reuters) - Anglo American AAL.L said on Thursday it would provide up to $30 million to support the rollout of COVID-19 vaccines across its global operations, with $10 million allocated to assist South Africa in its vaccination efforts. The cost of the vaccine programme to the industry could be around 300 million rand ($20 million), the Minerals Council said. Anglo American aims to vaccinate its 45,000 workforce, their families and surrounding communities in South Africa.
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4729.0
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2021-02-03 00:00:00 UTC
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American Airlines sending about 13,000 furlough warnings as pandemic pain continues
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AAL
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https://www.nasdaq.com/articles/american-airlines-sending-about-13000-furlough-warnings-as-pandemic-pain-continues-2021-02
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By Tracy Rucinski
Feb 3 (Reuters) - American Airlines AAL.O is telling about 13,000 employees that they are at risk of furlough when a U.S. aid package for airline workers expires on April 1, the company said on Wednesday.
Fort Worth, Texas-based American furloughed 19,000 workers when a previous round of government payroll support ended on Oct. 1 but recalled them in December after a fresh $15 billion for the industry through March.
The company had hoped that pandemic-hit demand would rebound by then, but slow rollouts of vaccines and the emergence of coronavirus variants are delaying the recovery, fueling a push by aviation unions for another $15 billion in U.S. payroll assistance.
"We are nearly five weeks into 2021, and unfortunately, we find ourselves in a situation similar to much of 2020," Chief Executive Doug Parker and President Robert Isom said in a memo to employees which was also included in a regulatory filing.
"The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have dampened demand," they said, adding that the company will not fly all of its aircraft this summer as planned.
United Airlines UAL.O has sent fresh furlough warnings to 14,000 employees, while Delta Air Lines Inc DAL.N and Southwest Airlines Co LUV.N have averted layoffs mostly thanks to voluntary leave programs.
American and United also offered voluntary deals to reduce staffing last year but were still forced to furlough.
American said it was launching a fresh round of exit packages in an effort to mitigate potential involuntary furloughs, similar to plans by United.
They are required by law to inform employees whose jobs are at risk, generally within 60 days.
American's potential furloughs include 1,850 pilots and 4,245 flight attendants. United's pilots approved a deal late last year to prevent furloughs until June.
(Reporting by Tracy Rucinski in Florida Editing by Matthew Lewis)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski Feb 3 (Reuters) - American Airlines AAL.O is telling about 13,000 employees that they are at risk of furlough when a U.S. aid package for airline workers expires on April 1, the company said on Wednesday. Fort Worth, Texas-based American furloughed 19,000 workers when a previous round of government payroll support ended on Oct. 1 but recalled them in December after a fresh $15 billion for the industry through March. The company had hoped that pandemic-hit demand would rebound by then, but slow rollouts of vaccines and the emergence of coronavirus variants are delaying the recovery, fueling a push by aviation unions for another $15 billion in U.S. payroll assistance.
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By Tracy Rucinski Feb 3 (Reuters) - American Airlines AAL.O is telling about 13,000 employees that they are at risk of furlough when a U.S. aid package for airline workers expires on April 1, the company said on Wednesday. United Airlines UAL.O has sent fresh furlough warnings to 14,000 employees, while Delta Air Lines Inc DAL.N and Southwest Airlines Co LUV.N have averted layoffs mostly thanks to voluntary leave programs. American said it was launching a fresh round of exit packages in an effort to mitigate potential involuntary furloughs, similar to plans by United.
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By Tracy Rucinski Feb 3 (Reuters) - American Airlines AAL.O is telling about 13,000 employees that they are at risk of furlough when a U.S. aid package for airline workers expires on April 1, the company said on Wednesday. United Airlines UAL.O has sent fresh furlough warnings to 14,000 employees, while Delta Air Lines Inc DAL.N and Southwest Airlines Co LUV.N have averted layoffs mostly thanks to voluntary leave programs. American said it was launching a fresh round of exit packages in an effort to mitigate potential involuntary furloughs, similar to plans by United.
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By Tracy Rucinski Feb 3 (Reuters) - American Airlines AAL.O is telling about 13,000 employees that they are at risk of furlough when a U.S. aid package for airline workers expires on April 1, the company said on Wednesday. American said it was launching a fresh round of exit packages in an effort to mitigate potential involuntary furloughs, similar to plans by United. United's pilots approved a deal late last year to prevent furloughs until June.
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4730.0
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2021-02-03 00:00:00 UTC
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7 Airline Stocks to Consider Boarding Now
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AAL
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https://www.nasdaq.com/articles/7-airline-stocks-to-consider-boarding-now-2021-02-03
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
This is an article about air travel companies. However, before I discuss airline stocks, I want to point out a stock market basic: the markets are a leading indicator, not a lagging one. So, the indices and stocks from specific industries recover well before a larger economic recovery. As such, in the pandemic-induced market meltdown this past year, the indices bottomed out towards the end of March 2020. However, the economy remains deep in recession.
Why is this important to note? If investors wait for economic recovery or a full-fledged industry bounce-back to invest in certain stocks, a significant part of the rally could already be over.
When it comes to the airline industry, fiscal year 2020 was disastrous. The International Air Transport Association (IATA) has estimated that the sector loss $118.5 billion last year and will probably lose $38.7 billion in 2021. Clearly, this is not a V-shaped recovery. However, things are starting to look up. The industry is betting on a traffic comeback in the second half of the year and that recovery can surprise on the upside if mass vaccination proves effective.
At the same time, it makes sense to be cautiously optimistic on airline stocks. A second wave of Covid-19 is already impacting travel within Europe. Therefore, I would not recommend a large exposure to these stocks. But I do see value from a 12 to 24-month investment horizon.
7 Blue Chip Stocks to Help Prepare For Your Retirement
So, here are seven airline stocks that look interesting at current levels. In my view, it makes sense to board one or more of these picks.
JetBlue Airways (NASDAQ:JBLU)
Alaska Air Group (NYSE:ALK)
Southwest Airlines (NYSE:LUV)
Delta Air Lines (NYSE:DAL)
American Airlines (NASDAQ:AAL)
Hawaiian Holdings (NASDAQ:HA)
Copa Holdings (NYSE:CPA)
7 Airline Stocks to Consider: JetBlue Airways (JBLU)
JBLU) aircraft interior" width="300" height="169">
Source: Shutterstock
I believe that JetBlue Airways is one of the better positioned airline stocks from a financial perspective. JBLU stock has trended higher by about 42% in the last six months and I expect that rally to sustain.
Recently, the company announced results for the fourth quarter of 2020. There are several positives to talk about. For instance, JetBlue maintains a robust liquidity position of $3.1 billion. Further, with a debt-to-capitalization ratio of about 55%, the company has robust financial flexibility.
The airline also reported a daily cash burn of $6.7 million for Q4 2020, which was better than expected. Considering its cash position, JBLU has five quarters of cash buffer to sustain its burn rate. It’s very likely that the industry will turn around before that. In the report, CEO Robin Hayes assured investors that “demand trends will improve later this year.”
Finally, JetBlue has also been working on route expansion. The airline has already initiated more than 80 new routes. Once recovery gains traction, this is likely to support cash flow upside. Because of that, I expect fuel costs to increase in the coming quarters. But it’s unlikely to be a concern if capacity utilization increases meaningfully.
Overall, JBLU stock is attractive and can deliver robust returns in the next four to eight quarters.
Alaska Air Group (ALK)
ALK) aircraft is airborne as it departs Los Angeles International Airport" width="300" height="169">
Source: Philip Pilosian / Shutterstock.com
ALK stock is another name among airline stocks that has moved well in the last six months. The company has strong fundamentals, especially compared to the likes of United Airlines (NASDAQ:UAL).
For Q4 2020, Alaska reported cash and equivalents of $3.3 billion. For the same period, the company’s debt-to-capitalization ratio was 61%. It’s also worth noting that the airline reported cash burn of about $4 million per day for the recent quarter. With its financial headroom, Alaska Air Group is well-positioned to navigate an extended period of downturn.
From a recovery perspective, Alaska Air Group also believes that “leisure will lead the recovery” and “business travel will [have] returned to only 50% of normal levels by end of year.” However, the airline has limited exposure to business and international travel. Therefore, going into 2022, ALK is likely to see meaningful improvement in capacity.
The Top 7 Hot Stocks to Buy for 2021’s Biggest Trends
In terms of potential upside for this stock, 15 analysts have ALK at a median price target of $62, with 11 rating it as a buy. That price implies a potential upside of nearly 19% from current levels of around $52. Therefore, ALK stock is attractive for fresh exposure at current levels.
Southwest Airlines (LUV)
LUV) jet flying above the clouds" width="300" height="169">
Source: Carlos E. Santa Maria / Shutterstock.com
Recently, Morgan Stanley opined that Southwest Airlines is the “best positioned airline to capitalize on a second half recovery.” LUV stock has already moved higher by 49% in the last six months. However, Morgan Stanley has a price target of $59 for the stock. This would imply an additional upside of about 28% from current levels of around $46.
As the industry continues to face headwinds, it’s important to talk about specific fundamentals. Through one of the worst crises, Southwest Airlines has managed to maintain an investment-grade balance sheet. The airline ended Q4 2020 with a robust cash buffer of $14.3 billion. Further, with unencumbered assets of $12 billion, the airline is well-positioned to navigate the headwinds.
It’s also important to note that, for fiscal year 2019, Southwest reported a net margin of 10.3% even after the negative impact of Boeing (NYSE:BA) 737 Max groundings. That net margin was one of the best in the industry. I should also add that LUV remained profitable for 47 consecutive years through fiscal 2019.
With this track record and the current balance sheet health, LUV stock is certainly among the top airline stocks to consider.
Delta Air Lines (DAL)
DAL) logo. Represents airline stocks." width="300" height="169">
Source: Lerner Vadim / Shutterstock.com
The next name on my list of airline stocks is Delta Air Lines. Recently, Delta was in the news with plans to bring back “400 pilots to active flying status by this summer.” The company’s CEO, Ed Bastian, also believes that the airline is likely to return to profitability by summer of fiscal year 2021.
Given this optimism, I expect further upside for DAL stock, which has already moved higher by over 56% in the last six months. Morgan Stanley is already overweight on the name with a price target of $55. This would imply an upside of roughly 41% from the current $39 level.
From a liquidity perspective, Delta has also done well in the circumstances, ending 2020 with a total liquidity buffer of $16.7 billion. In addition, the airline has unencumbered assets of $9 to $10 billion. Finally, it’s worth noting that, for December 2020, Delta reduced its daily cash burn to $12 million. This is 90% lower than the daily cash burn it had in March 2020. Therefore, cost-cutting initiatives have yielded solid results and the current liquidity buffer will help the company navigate the rest of this crisis period.
7 Safe Stocks to Buy for Solid Returns in Tumultuous Times
As Delta moves toward profitability in the next few quarters, I expect this stock to continue its momentum. A pick-up in leisure travel in the second half of 2021 is also likely to ensure that DAL stock trades above $50.
American Airlines (AAL)
Source: GagliardiPhotography / Shutterstock.com
In the last six months, AAL stock has been another great performer when it comes airline stocks. Over that period, the stock has surged by 54%. However, over a one-year period, it’s still lower by some 36%. So, there’s still work to do. With the airline recently reporting better-than-expected earnings, though, I am optimistic that its rally will sustain.
Among several positives in its Q4 2020 results, American Airlines has reduced daily cash burn to $30 million — $70 million lower than where it was in April at the onset of the pandemic. Moreover, the airline also closed its quarter with liquidity of $14.3 billion. By the end of Q1 2021, its cash position is expected to be $15 billion. Therefore, there are ample funds to navigate through the challenges of current year — including debt repayments and capital expenditure.
Recently, American Airlines has also partnered with Alaska Air Group and JetBlue to enhance its network for customers in the Northeast and on the West Coast of the United States. Once passenger traffic increases, it will be easier to see the positive impact of this partnership. That pick-up in traffic is possible by the second half of the year.
Finally, the company also plans to utilize its excess liquidity for de-leveraging once cash flow growth resumes. So, I am positive on the outlook for the later half of 2021 as well as for 2022. In all probability, the worst is over for AAL stock.
Hawaiian Holdings (HA)
Source: Shutterstock
HA stock is also one of the more attractive airline stocks out there right now. However, I would avoid fresh exposure to the stock after an upside of over 76% in the last six months. Eight analysts offering 12-month price forecasts for Hawaiian Holdings have a median target of $17.50. HA currently trades at nearly $21. Therefore, I expect some correction and consolidation before the next leg of its rally.
A key positive for the airline, though, is the re-opening of Hawaii to tourism. With pre-travel Covid-19 testing eliminating the requirement for quarantine, it’s likely that this tourism will witness growth in the coming quarters. Plus, expansion of the airline’s network in North America will also likely yield positive results beyond the current year. That said, though, it remains to be seen whether or not Hawaiian can reduce its dependence on travel to its namesake on a relative basis.
8 Cheap Stocks to Buy With Your Next Stimulus Check
In terms of cash buffer, the airline company reported cash and equivalents of $864 million as of Q4 2020. Further, the daily cash burn for the quarter was $1.7 million. Therefore, Hawaiian Holdings has enough money to make it through the rest of the year.
Copa Holdings (CPA)
Source: Carlos Yudica/Shutterstock.com
Last on my list of airline stocks is CPA stock, another name that’s worth keeping on your investment radar. However, this stock is unattractive currently after a big upside of over 95% in the last six months.
A key reason for the strong rally is fundamentals. For Q3 2020, the airline reported a cash buffer of $1.3 billion. For the same period, the total debt was at $1.2 billion. Cash burn was also low at $36 million per month. Considering the present liquidity buffer, I don’t see significant leveraging in the current year.
It’s worth noting, though, that after nearly five months of no operations, the airline recommenced service to several destinations. By November, it had gradually expanded to 38 locations in a network that usually extends to 80 destinations across 33 countries.
In the coming months, I expect passenger traffic to witness steady growth. Operating level profitability is also likely to be the next upside trigger for CPA stock.
On the date of publication, Faisal Humayun did not have (either directly or indirectly) any positions in any of the securities mentioned in this article.
Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modelling. Faisal has authored more than 1,500 stock specific articles with focus on the technology, energy and commodities sector.
The post 7 Airline Stocks to Consider Boarding Now appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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JetBlue Airways (NASDAQ:JBLU) Alaska Air Group (NYSE:ALK) Southwest Airlines (NYSE:LUV) Delta Air Lines (NYSE:DAL) American Airlines (NASDAQ:AAL) Hawaiian Holdings (NASDAQ:HA) Copa Holdings (NYSE:CPA) 7 Airline Stocks to Consider: JetBlue Airways (JBLU) JBLU) aircraft interior" width="300" height="169"> Source: Shutterstock I believe that JetBlue Airways is one of the better positioned airline stocks from a financial perspective. American Airlines (AAL) Source: GagliardiPhotography / Shutterstock.com In the last six months, AAL stock has been another great performer when it comes airline stocks. In all probability, the worst is over for AAL stock.
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JetBlue Airways (NASDAQ:JBLU) Alaska Air Group (NYSE:ALK) Southwest Airlines (NYSE:LUV) Delta Air Lines (NYSE:DAL) American Airlines (NASDAQ:AAL) Hawaiian Holdings (NASDAQ:HA) Copa Holdings (NYSE:CPA) 7 Airline Stocks to Consider: JetBlue Airways (JBLU) JBLU) aircraft interior" width="300" height="169"> Source: Shutterstock I believe that JetBlue Airways is one of the better positioned airline stocks from a financial perspective. American Airlines (AAL) Source: GagliardiPhotography / Shutterstock.com In the last six months, AAL stock has been another great performer when it comes airline stocks. In all probability, the worst is over for AAL stock.
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JetBlue Airways (NASDAQ:JBLU) Alaska Air Group (NYSE:ALK) Southwest Airlines (NYSE:LUV) Delta Air Lines (NYSE:DAL) American Airlines (NASDAQ:AAL) Hawaiian Holdings (NASDAQ:HA) Copa Holdings (NYSE:CPA) 7 Airline Stocks to Consider: JetBlue Airways (JBLU) JBLU) aircraft interior" width="300" height="169"> Source: Shutterstock I believe that JetBlue Airways is one of the better positioned airline stocks from a financial perspective. American Airlines (AAL) Source: GagliardiPhotography / Shutterstock.com In the last six months, AAL stock has been another great performer when it comes airline stocks. In all probability, the worst is over for AAL stock.
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JetBlue Airways (NASDAQ:JBLU) Alaska Air Group (NYSE:ALK) Southwest Airlines (NYSE:LUV) Delta Air Lines (NYSE:DAL) American Airlines (NASDAQ:AAL) Hawaiian Holdings (NASDAQ:HA) Copa Holdings (NYSE:CPA) 7 Airline Stocks to Consider: JetBlue Airways (JBLU) JBLU) aircraft interior" width="300" height="169"> Source: Shutterstock I believe that JetBlue Airways is one of the better positioned airline stocks from a financial perspective. American Airlines (AAL) Source: GagliardiPhotography / Shutterstock.com In the last six months, AAL stock has been another great performer when it comes airline stocks. In all probability, the worst is over for AAL stock.
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4731.0
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2021-02-03 00:00:00 UTC
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If There's Another COVID-19 Lockdown, Here's What You Need to Know
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AAL
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https://www.nasdaq.com/articles/if-theres-another-covid-19-lockdown-heres-what-you-need-to-know-2021-02-03
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U.K. Prime Minister Boris Johnson kicked off 2021 by locking down his country yet again as new mutations of the COVID-19 virus, potentially more deadly than the last, spread across the nation.
Now those mutations have been discovered in the U.S., and because President Biden's advisors previously said new four- to six-week lockdowns could help defeat the old coronavirus outbreak, investors should consider the implications for business if he "follows the science" and goes for yet another lockdown.
The last time, it was supposed to be just two weeks to bend the curve, and it ran into months. There are numerous businesses still not fully reopened almost a year later, so new lockdowns could be devastating. Here are some the industries that are most at risk.
Image source: Getty Images.
Entertainment
The movie theater industry is already on the brink of ruin because it's running at minimal capacity and there are few movies in theaters to go see.
AMC Entertainment Holdings (NYSE: AMC) only just staved off bankruptcy by raising almost $1 billion from its lenders to survive through 2021, but only if the economy reopens, movie studios release films into theaters again, and Hollywood starts making new movies. If the spigot is turned off more, it and other cinema operators could collapse.
Studios are using their streaming services to funnel movies to consumers, sometimes undercutting the theaters' window of exclusivity. AT&T's (NYSE: T) Warner Bros. studio is releasing all of its 2021 slate of movies to HBO Max on the same day they hit theaters, while Disney (NYSE: DIS) says 80% of the 100 or so movies and TV shows it has planned for the future will go to its Disney+ service or other direct-to-consumer services.
Disney needs to bolster its streaming service because its theme parks are operating at less than optimal capacity, and Disneyland in California remains closed, even as the state's governor declared Hollywood studios essential businesses in his new lockdown orders.
Similarly, Comcast's (NASDAQ: CMCSA) Universal Studios theme park in California is closed, though its parks have reopened elsewhere, but new lockdowns would further widen the losses this segment is wreaking on their financial statements.
Restaurants
The restaurant industry barely survived the pandemic, subsisting on takeout and delivery until indoor seating was allowed once again. Yet with severely reduced seating capacity, chains resorted to outdoor seating in their parking lots to help make up the difference.
Certain casual dining operators like Darden Restaurants (NYSE: DRI) did better than most because they had previously established a robust off-premise business before the pandemic hit, while fast-food chains like McDonald's (NYSE: MCD) with their drive-thru windows and third-party delivery services, also came through -- if not unscathed, certainly in a better position than family and fine-dining chains.
The drive-thru has also become crucial to fast-casual leader Chipotle Mexican Grill (NYSE: CMG) and even Shake Shack (NYSE: SHAK), which has committed to punching holes in the walls of its restaurants wherever it can to install drive-thru and walk-up windows.
Eatertainment giant Dave & Buster's (NASDAQ: PLAY), though, did not fare well because it had no takeout business to fall back on. Its entertainment-oriented atmosphere of arcades and gaming is only conducive to an in-restaurant experience.
While the industry has learned valuable lessons about how to operate in the future, new lockdowns could still devastate restaurants since reduced volumes will eventually eviscerate their financial statements.
Travel and tourism
As noted above, theme parks would undoubtedly feel the swift impact of a shutdown, but the industries that even tangentially support the parks would be put at risk of going under.
Airlines, for example, fly families to these vacation destinations, and would be at risk of going under -- though plummeting demand for business travel is what would likely seal their fate. Carrying large amounts of debt and struggling through an extended period of reduced demand, not even converting their planes over from passenger to cargo as some are doing would offset the loss of business.
American Airlines Group (NASDAQ: AAL), which started carrying cargo for the first time in 36 years last year, is burning through cash at a rate of $30 million a day, or some $11 billion a year. Delta Air Lines (NYSE: DAL) is burning through "only" $12 million daily.
Cruise ship operators are also just barely treading water to stay afloat, with Carnival (NYSE: CCL) (NYSE: CUK), Norwegian Cruise Line Holdings (NYSE: NCLH), and Royal Caribbean (NYSE: RCL) all pushing their current relaunch dates further and further into 2021. Disney, too, recently canceled all spring cruises.
Even then, when they do take to the high seas once more, it will be with only a few vessels at greatly reduced capacity, hardly enough to sustain them for very long. It's not expected their flotillas will resume a full schedule until 2022 at the earliest, so new lockdown orders would push back their launch dates even longer, further endangering their ability to survive.
A glimmer of hope?
It could be that the economy will escape the devastation of new lockdowns if the vaccines being distributed prove fairly effective against the new COVID-19 strains, as some of the pharmaceutical companies and biotechs indicate they are.
Yet the threat of persistent lockdowns hanging over business is a danger investors need to remain cognizant of. Shutting down broad swaths of industry again will ruin the economy, regardless of whatever loans and assistance the government promises, sending the country into a new recession, if not depression.
With that possibility in mind, investors should assume a defensive posture and protect their portfolios from becoming encumbered by lockdowns.
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Rich Duprey owns shares of AT&T. The Motley Fool owns shares of and recommends Chipotle Mexican Grill and Walt Disney. The Motley Fool recommends Carnival, Comcast, Dave & Busters Entertainment, and Delta Air Lines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group (NASDAQ: AAL), which started carrying cargo for the first time in 36 years last year, is burning through cash at a rate of $30 million a day, or some $11 billion a year. Disney needs to bolster its streaming service because its theme parks are operating at less than optimal capacity, and Disneyland in California remains closed, even as the state's governor declared Hollywood studios essential businesses in his new lockdown orders. Carrying large amounts of debt and struggling through an extended period of reduced demand, not even converting their planes over from passenger to cargo as some are doing would offset the loss of business.
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American Airlines Group (NASDAQ: AAL), which started carrying cargo for the first time in 36 years last year, is burning through cash at a rate of $30 million a day, or some $11 billion a year. AMC Entertainment Holdings (NYSE: AMC) only just staved off bankruptcy by raising almost $1 billion from its lenders to survive through 2021, but only if the economy reopens, movie studios release films into theaters again, and Hollywood starts making new movies. Cruise ship operators are also just barely treading water to stay afloat, with Carnival (NYSE: CCL) (NYSE: CUK), Norwegian Cruise Line Holdings (NYSE: NCLH), and Royal Caribbean (NYSE: RCL) all pushing their current relaunch dates further and further into 2021.
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American Airlines Group (NASDAQ: AAL), which started carrying cargo for the first time in 36 years last year, is burning through cash at a rate of $30 million a day, or some $11 billion a year. Disney needs to bolster its streaming service because its theme parks are operating at less than optimal capacity, and Disneyland in California remains closed, even as the state's governor declared Hollywood studios essential businesses in his new lockdown orders. Certain casual dining operators like Darden Restaurants (NYSE: DRI) did better than most because they had previously established a robust off-premise business before the pandemic hit, while fast-food chains like McDonald's (NYSE: MCD) with their drive-thru windows and third-party delivery services, also came through -- if not unscathed, certainly in a better position than family and fine-dining chains.
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American Airlines Group (NASDAQ: AAL), which started carrying cargo for the first time in 36 years last year, is burning through cash at a rate of $30 million a day, or some $11 billion a year. There are numerous businesses still not fully reopened almost a year later, so new lockdowns could be devastating. Here are some the industries that are most at risk.
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4732.0
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2021-02-03 00:00:00 UTC
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Anglo American says De Beers' diamond sales exceed pre-pandemic levels
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AAL
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https://www.nasdaq.com/articles/anglo-american-says-de-beers-diamond-sales-exceed-pre-pandemic-levels-2021-02-03
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Feb 3 (Reuters) - Anglo American Plc AAL.L said its diamond unit recorded higher sales in the first cycle of 2021, boosted by robust demand ahead of the Chinese New Year and Valentine's Day and as midstream customers restocked to fill orders from retail businesses.
The miner said on Wednesday the value of rough diamond sales for De Beers' first sales cycle of 2021 was $650 million, compared with $551 million last year, well before the COVID-19 outbreak hit an already weakened diamond market.
(Reporting by Shanima A in Bengaluru; Editing by Amy Caren Daniel)
((shanima.a@thomsonreuters.com; Direct: +91 7760347399;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 3 (Reuters) - Anglo American Plc AAL.L said its diamond unit recorded higher sales in the first cycle of 2021, boosted by robust demand ahead of the Chinese New Year and Valentine's Day and as midstream customers restocked to fill orders from retail businesses. The miner said on Wednesday the value of rough diamond sales for De Beers' first sales cycle of 2021 was $650 million, compared with $551 million last year, well before the COVID-19 outbreak hit an already weakened diamond market. (Reporting by Shanima A in Bengaluru; Editing by Amy Caren Daniel) ((shanima.a@thomsonreuters.com; Direct: +91 7760347399;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 3 (Reuters) - Anglo American Plc AAL.L said its diamond unit recorded higher sales in the first cycle of 2021, boosted by robust demand ahead of the Chinese New Year and Valentine's Day and as midstream customers restocked to fill orders from retail businesses. The miner said on Wednesday the value of rough diamond sales for De Beers' first sales cycle of 2021 was $650 million, compared with $551 million last year, well before the COVID-19 outbreak hit an already weakened diamond market. (Reporting by Shanima A in Bengaluru; Editing by Amy Caren Daniel) ((shanima.a@thomsonreuters.com; Direct: +91 7760347399;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 3 (Reuters) - Anglo American Plc AAL.L said its diamond unit recorded higher sales in the first cycle of 2021, boosted by robust demand ahead of the Chinese New Year and Valentine's Day and as midstream customers restocked to fill orders from retail businesses. The miner said on Wednesday the value of rough diamond sales for De Beers' first sales cycle of 2021 was $650 million, compared with $551 million last year, well before the COVID-19 outbreak hit an already weakened diamond market. (Reporting by Shanima A in Bengaluru; Editing by Amy Caren Daniel) ((shanima.a@thomsonreuters.com; Direct: +91 7760347399;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 3 (Reuters) - Anglo American Plc AAL.L said its diamond unit recorded higher sales in the first cycle of 2021, boosted by robust demand ahead of the Chinese New Year and Valentine's Day and as midstream customers restocked to fill orders from retail businesses. The miner said on Wednesday the value of rough diamond sales for De Beers' first sales cycle of 2021 was $650 million, compared with $551 million last year, well before the COVID-19 outbreak hit an already weakened diamond market. (Reporting by Shanima A in Bengaluru; Editing by Amy Caren Daniel) ((shanima.a@thomsonreuters.com; Direct: +91 7760347399;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4733.0
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2021-02-02 00:00:00 UTC
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Glencore appoints Anglo American's ex-boss Carroll to board
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AAL
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https://www.nasdaq.com/articles/glencore-appoints-anglo-americans-ex-boss-carroll-to-board-2021-02-02
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Feb 2 (Reuters) - Swiss commodities trader Glencore GLEN.L said on Tuesday it had appointed Cynthia Carroll, the former chief executive officer of London-based miner Anglo American AAL.L, to its board of directors.
Carroll, who led Anglo American for more than five years until she stepped down in 2013, will join Glencore's board immediately as an independent non-executive director.
The appointment follows report of Glencore's long-time boss, Ivan Glasenberg, stepping down later this year to be replaced by Gary Nagle, head of coal assets at the mining and trading group.
A geologist by training, New Jersey-born Carroll moved from the aluminium industry to become the first non-South African, the first woman and the first outsider to take the top job at Anglo in 2007. (https://reut.rs/3jbsQeZ)
She is currently a non-executive director at Hitachi 6501.T, Baker Hughes BKR.N and Pembina Pipeline PPL.TO.
(Reporting by Yadarisa Shabong in Bengaluru; additional reporting by Pushkala Aripaka; editing by Vinay Dwivedi>)
((Yadarisa.Shabong@thomsonreuters.com; Twitter: https://twitter.com/Yadarisa; +919742735150;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 2 (Reuters) - Swiss commodities trader Glencore GLEN.L said on Tuesday it had appointed Cynthia Carroll, the former chief executive officer of London-based miner Anglo American AAL.L, to its board of directors. The appointment follows report of Glencore's long-time boss, Ivan Glasenberg, stepping down later this year to be replaced by Gary Nagle, head of coal assets at the mining and trading group. A geologist by training, New Jersey-born Carroll moved from the aluminium industry to become the first non-South African, the first woman and the first outsider to take the top job at Anglo in 2007.
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Feb 2 (Reuters) - Swiss commodities trader Glencore GLEN.L said on Tuesday it had appointed Cynthia Carroll, the former chief executive officer of London-based miner Anglo American AAL.L, to its board of directors. Carroll, who led Anglo American for more than five years until she stepped down in 2013, will join Glencore's board immediately as an independent non-executive director. (https://reut.rs/3jbsQeZ) She is currently a non-executive director at Hitachi 6501.T, Baker Hughes BKR.N and Pembina Pipeline PPL.TO.
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Feb 2 (Reuters) - Swiss commodities trader Glencore GLEN.L said on Tuesday it had appointed Cynthia Carroll, the former chief executive officer of London-based miner Anglo American AAL.L, to its board of directors. Carroll, who led Anglo American for more than five years until she stepped down in 2013, will join Glencore's board immediately as an independent non-executive director. (Reporting by Yadarisa Shabong in Bengaluru; additional reporting by Pushkala Aripaka; editing by Vinay Dwivedi>) ((Yadarisa.Shabong@thomsonreuters.com; Twitter: https://twitter.com/Yadarisa; +919742735150;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Feb 2 (Reuters) - Swiss commodities trader Glencore GLEN.L said on Tuesday it had appointed Cynthia Carroll, the former chief executive officer of London-based miner Anglo American AAL.L, to its board of directors. Carroll, who led Anglo American for more than five years until she stepped down in 2013, will join Glencore's board immediately as an independent non-executive director. The appointment follows report of Glencore's long-time boss, Ivan Glasenberg, stepping down later this year to be replaced by Gary Nagle, head of coal assets at the mining and trading group.
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4734.0
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2021-02-02 00:00:00 UTC
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Chile's Codelco, top miners see production plunge in December
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AAL
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https://www.nasdaq.com/articles/chiles-codelco-top-miners-see-production-plunge-in-december-2021-02-02
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SANTIAGO, Jan 4 (Reuters) - Chilean state copper giant Codelco saw its production of the red metal plunge in December, while other top mines in Chile also saw output drop off, government figures released on Tuesday showed.
The national copper commission Cochilco said that output at Codelco, the world's largest copper miner, fell 16% year-on-year to 157,800 tonnes for the month. Total 2020 production for the miner inched up 1.2% over the previous year.
Escondida - the largest copper deposit in the world controlled by BHP BHP.AX - fell 0.7% year-on-year to 104,900 tons. Production in 2020 remained flat with the previous year.
Collahuasi - a partnership between Glencore GLEN.N and Anglo American AAL.L with Japanese firms - posted a 22% year-on-year decrease in production to 44,200 tons in December. Overall 2020 production jumped 11.3% versus 2019, the statistics show.
(Reporting by Fabian Cambero, writing by Dave Sherwood)
((dave.sherwood@thomsonreuters.com; +56 9 9138 1047, +56 2 2370 4224; Reuters Messaging: dave.sherwood.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Collahuasi - a partnership between Glencore GLEN.N and Anglo American AAL.L with Japanese firms - posted a 22% year-on-year decrease in production to 44,200 tons in December. SANTIAGO, Jan 4 (Reuters) - Chilean state copper giant Codelco saw its production of the red metal plunge in December, while other top mines in Chile also saw output drop off, government figures released on Tuesday showed. Escondida - the largest copper deposit in the world controlled by BHP BHP.AX - fell 0.7% year-on-year to 104,900 tons.
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Collahuasi - a partnership between Glencore GLEN.N and Anglo American AAL.L with Japanese firms - posted a 22% year-on-year decrease in production to 44,200 tons in December. The national copper commission Cochilco said that output at Codelco, the world's largest copper miner, fell 16% year-on-year to 157,800 tonnes for the month. Total 2020 production for the miner inched up 1.2% over the previous year.
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Collahuasi - a partnership between Glencore GLEN.N and Anglo American AAL.L with Japanese firms - posted a 22% year-on-year decrease in production to 44,200 tons in December. SANTIAGO, Jan 4 (Reuters) - Chilean state copper giant Codelco saw its production of the red metal plunge in December, while other top mines in Chile also saw output drop off, government figures released on Tuesday showed. The national copper commission Cochilco said that output at Codelco, the world's largest copper miner, fell 16% year-on-year to 157,800 tonnes for the month.
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Collahuasi - a partnership between Glencore GLEN.N and Anglo American AAL.L with Japanese firms - posted a 22% year-on-year decrease in production to 44,200 tons in December. The national copper commission Cochilco said that output at Codelco, the world's largest copper miner, fell 16% year-on-year to 157,800 tonnes for the month. Total 2020 production for the miner inched up 1.2% over the previous year.
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4735.0
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2021-02-02 00:00:00 UTC
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5 Ultra-Popular Stocks to Avoid Like the Plague in February
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AAL
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https://www.nasdaq.com/articles/5-ultra-popular-stocks-to-avoid-like-the-plague-in-february-2021-02-02
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We've turned the page on 2020, but that doesn't mean we left last year's volatility at the doorstep. If anything, Wall Street and investors have been made well aware of the uncertainty still plaguing the U.S. economy and equities over the past couple of weeks.
This historical volatility has been readily apparent in the so-called YOLO -- you only live once -- stocks or "Reddit-raid" companies. For more than a week now, we've watched retail investors on community chatrooms band together to seemingly manipulate heavily short-sold stocks in order to create an explosive short squeeze.
Suffice it to say, these are crazy times, and investors are witnessing some truly historic (and likely unsustainable) returns.
As we move forward into February, five ultra-popular stocks stand out as companies that investors would be wise to avoid like the plague.
Image source: Getty Images.
GameStop
A common theme this month is going to be keeping your distance from heavily short-sold stocks that have detached from their underlying fundamentals. The poster child of this is multichannel video game and accessories retailer GameStop (NYSE: GME). Even with certain brokerages (ahem, Robinhood) restricting trading in GameStop, it still managed to end the month of January higher by a cool 1,625%. That's not a typo.
GameStop was the most heavily short-sold stock in January, making it the prime target of retail investors in the r/WallStreetBets chatroom on Reddit. The problem is, pessimism surrounding GameStop looks to be well founded, especially with the company doubling in value multiple times last month.
GameStop has been forced to continue closing some of its brick-and-mortar locations in order to reduce its costs. The company was profitable for a long time, but has lately produced three consecutive years of losses as the gaming ecosystem moves online. Though the company is slowly adapting -- e-commerce sales during the 2020 holiday season more than quadrupled from the prior-year period -- it's unclear if that's going to be enough to push the company back into the black.
Investors shouldn't have to wonder about the long-term survival of a company that's worth $23 billion and has gained more than 1,600% in a month. That's why GameStop should be avoided like the plague.
Image source: Getty Images.
AMC Entertainment
Another core YOLO stock that should be avoided at all costs in February is movie theater operator AMC Entertainment (NYSE: AMC).
One of the market's most short-sold stocks, AMC gained 278% last week. Although the company did secure $917 million in funding from a combination of debt and equity offerings, the bulk of its share price gains seems tied to Reddit-based trading activity rather than anything tangible.
There are three reasons these astronomical gains in AMC are so egregious. First, AMC narrowly averted bankruptcy a little over a week ago, yet somehow ended last week with a $4.5 billion market cap. Companies that manage to stave off bankruptcy with an 11th-hour cash infusion typically aren't worth $4.5 billion.
Secondly, we don't know when movie theater traffic will return to pre-pandemic levels. Vaccine supply constraints and new variants of the virus could make a return to normal difficult. Plus, the ability to access new content online could completely crush the traditional movie theater model.
Third and finally, AMC is tinkering with the idea of selling even more stock as of Friday evening, Jan. 29. That's a fancy way of saying that additional dilution is headed investors' way.
Image source: Getty Images.
Koss Corp.
Yet another Reddit darling that should be avoided like the plague is small-cap Koss (NASDAQ: KOSS). Over the past 40 years, this manufacturer of headphones, Bluetooth speakers, and various communications headsets has never its stock ascend higher than $15. Last week, it hit $174 in premarket trading after closing at $3 and change just a few days earlier.
While Koss's second-quarter operating results released last week weren't bad, they in no way validated the 1,817% gain the company registered in a five-day period. Sales through the first six months of fiscal 2021 are up a modest 6% to $10.1 million, with net income of $0.09 per share. If we arbitrarily extrapolate these figures out for the full fiscal year, Koss, which runs a highly cyclical and commoditized business, is valued at more than 27 times sales and 356 times full-year net income.
Koss' high short interest and low float have made it a popular target for retail investors. But nothing about its existing valuation makes sense.
Image source: Getty Images.
Sundial Growers
Marijuana stock Sundial Growers (NASDAQ: SNDL) is another ultra-popular name to add to the avoid list following a 72% run-up in January.
There's no question that cannabis is an especially hot investment right now. Democratic Party control of the White House and Congress has reignited discussion about the U.S. possibly legalizing cannabis at the federal level. This has put some pep in the step of all Canadian pot stocks.
However, Sundial Growers isn't like most Canadian cannabis companies. Whereas all Canadian licensed producers have issued shares at one point or another to fund an acquisition or cover day-to-day expenses, Sundial's dilution has come at investors like a tsunami. In order to improve its financial position, the company sold shares of its stock and converted some of its debt to equity. In fact, on Friday, Jan. 29, the company announced a $100 million registered direct offering of shares and warrants. In my more than two decades of investing, I've seen few instances where a company's share count has been ballooned so quickly.
Additionally, Sundial Growers may need to enact a reverse split to avoid delisting, and it continues to lose quite a bit of money as it transitions from wholesale cannabis sales to a higher-margin retail operating model. It's one of the worst pot stocks investors can buy.
Image source: American Airlines.
American Airlines Group
Last but not least, American Airlines Group (NASDAQ: AAL) is a stock to steer clear of in February, and probably well beyond.
Unlike the other companies on this list, American Airlines had a modest gain in January of only 9%. While its perceived-to-be low share price following the coronavirus pandemic has some investors (and many Robinhood millennials) betting on a rebound in the months and years to come, I view American Airlines as the absolute worst airline stock.
The company is currently lugging around north of $41 billion in total debt and roughly $33 billion in net debt. Even with access to coronavirus relief funding, the company's financial flexibility has been compromised by its debt load. Servicing its existing debt will constrain most of its growth initiatives for years.
Furthermore, American Airlines is no longer paying a dividend or buying back stock as a result of accepting coronavirus relief funds. Its capital return program was perhaps the only good thing American Airlines had going for it.
The airline industry is capital-intensive, low-margin, and it relies on economic expansion, which is far from a certainty at the moment. That makes American Airlines wholly avoidable.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Last but not least, American Airlines Group (NASDAQ: AAL) is a stock to steer clear of in February, and probably well beyond. For more than a week now, we've watched retail investors on community chatrooms band together to seemingly manipulate heavily short-sold stocks in order to create an explosive short squeeze. Although the company did secure $917 million in funding from a combination of debt and equity offerings, the bulk of its share price gains seems tied to Reddit-based trading activity rather than anything tangible.
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American Airlines Group Last but not least, American Airlines Group (NASDAQ: AAL) is a stock to steer clear of in February, and probably well beyond. GameStop was the most heavily short-sold stock in January, making it the prime target of retail investors in the r/WallStreetBets chatroom on Reddit. AMC Entertainment Another core YOLO stock that should be avoided at all costs in February is movie theater operator AMC Entertainment (NYSE: AMC).
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American Airlines Group Last but not least, American Airlines Group (NASDAQ: AAL) is a stock to steer clear of in February, and probably well beyond. While its perceived-to-be low share price following the coronavirus pandemic has some investors (and many Robinhood millennials) betting on a rebound in the months and years to come, I view American Airlines as the absolute worst airline stock. 10 stocks we like better than American Airlines Group When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen.
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American Airlines Group Last but not least, American Airlines Group (NASDAQ: AAL) is a stock to steer clear of in February, and probably well beyond. GameStop was the most heavily short-sold stock in January, making it the prime target of retail investors in the r/WallStreetBets chatroom on Reddit. That's why GameStop should be avoided like the plague.
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4736.0
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2021-02-01 00:00:00 UTC
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American Airlines CEO tells employees to brace for furlough warnings
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AAL
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https://www.nasdaq.com/articles/american-airlines-ceo-tells-employees-to-brace-for-furlough-warnings-2021-02-01
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By Tracy Rucinski
Feb 1 (Reuters) - American Airlines AAL.O workers should brace for another round of furlough warnings in the near term as the airline expects to remain overstaffed on April 1, when U.S. aid for industry workers expires, Chief Executive Doug Parker said.
American is among U.S. airlines that received a $15 billion payroll support package in December to protect workers' jobs and salaries through March, when the industry had hoped that pandemic-hit demand would have recovered with vaccine rollouts.
"What hasn't happen is what we'd hoped would happen, that we'd get to April 1 and say oh my god ... everybody we have we're going to need them in the July schedule," Parker said during a Jan. 28 employee town hall meeting, according to a recording reviewed by Reuters.
An American spokesman confirmed the veracity of the recording.
U.S. aviation unions are urging Congress to extend a third round of payroll assistance, something Parker said he would support and also fight for.
"That's a much better solution than having people furloughed again when we know that this (COVID-19) is months away from being eradicated," he said during the town hall.
American furloughed 19,000 workers when a first round of government payroll support expired on Oct. 1 but recalled them in December. Parker said he hoped fewer workers would be impacted this time round.
Last week, United Airlines UAL.O said it had sent furlough warnings to some 14,000 employees.
(Reporting by Tracy Rucinski, Editing by Franklin Paul and Richard Chang)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski Feb 1 (Reuters) - American Airlines AAL.O workers should brace for another round of furlough warnings in the near term as the airline expects to remain overstaffed on April 1, when U.S. aid for industry workers expires, Chief Executive Doug Parker said. American is among U.S. airlines that received a $15 billion payroll support package in December to protect workers' jobs and salaries through March, when the industry had hoped that pandemic-hit demand would have recovered with vaccine rollouts. U.S. aviation unions are urging Congress to extend a third round of payroll assistance, something Parker said he would support and also fight for.
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By Tracy Rucinski Feb 1 (Reuters) - American Airlines AAL.O workers should brace for another round of furlough warnings in the near term as the airline expects to remain overstaffed on April 1, when U.S. aid for industry workers expires, Chief Executive Doug Parker said. "What hasn't happen is what we'd hoped would happen, that we'd get to April 1 and say oh my god ... everybody we have we're going to need them in the July schedule," Parker said during a Jan. 28 employee town hall meeting, according to a recording reviewed by Reuters. American furloughed 19,000 workers when a first round of government payroll support expired on Oct. 1 but recalled them in December.
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By Tracy Rucinski Feb 1 (Reuters) - American Airlines AAL.O workers should brace for another round of furlough warnings in the near term as the airline expects to remain overstaffed on April 1, when U.S. aid for industry workers expires, Chief Executive Doug Parker said. American is among U.S. airlines that received a $15 billion payroll support package in December to protect workers' jobs and salaries through March, when the industry had hoped that pandemic-hit demand would have recovered with vaccine rollouts. American furloughed 19,000 workers when a first round of government payroll support expired on Oct. 1 but recalled them in December.
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By Tracy Rucinski Feb 1 (Reuters) - American Airlines AAL.O workers should brace for another round of furlough warnings in the near term as the airline expects to remain overstaffed on April 1, when U.S. aid for industry workers expires, Chief Executive Doug Parker said. "What hasn't happen is what we'd hoped would happen, that we'd get to April 1 and say oh my god ... everybody we have we're going to need them in the July schedule," Parker said during a Jan. 28 employee town hall meeting, according to a recording reviewed by Reuters. American furloughed 19,000 workers when a first round of government payroll support expired on Oct. 1 but recalled them in December.
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4737.0
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2021-02-01 00:00:00 UTC
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GLOBAL MARKETS-Shares rally, retail surge drives silver to 8-year high
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AAL
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https://www.nasdaq.com/articles/global-markets-shares-rally-retail-surge-drives-silver-to-8-year-high-2021-02-01-2
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By Herbert Lash
NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high.
A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic and left precious metals dealers scrambling for bars and coins to meet demand.
The iShares Silver Trust ETF SLV.N - the largest silver-backed ETF - jumped 7.1%. Data showed its holdings rose by a record 37 million shares from Thursday to Friday alone, each representing an ounce of silver.
Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers on the FTSE 100 .FTSE in London, with the blue-chip index closing up 0.92%.
Miner Fresnillo FRES.L rose 8.95% to 1,076 to help lead the pan-European STOXX 600 index .STOXX end 1.24% higher.
U.S. small-cap miners Hecla Mining Co HL.N and Coeur Mining Inc CDE.N surged 28.3% and 23.1%, respectively.
Silver prices XAG= climbed to an eight-year peak of just over $30 an ounce before paring gains to trade up 6.3% at $28.70.
The trading frenzy drove huge gains in companies such as GameStop Corp GME.N last week, forcing hedge funds to cover bets it would decline. GameStop GME.N slid 30.77% to $225.00.
"Silver has knock-on effects compared to GameStop because it has links to miners," said Connor Campbell, a financial analyst at SpreadEx. "If you start pushing silver higher, that is going to have effects on other industries and other markets and that is clearly what happened."
Silver has gained 19% in price since Thursday after posts on Reddit led small investors to buy silver mining stocks and exchange-traded funds (ETF) backed by physical silver bars, in a GameStop-style squeeze.
Spot silver XAG= was up 6.97% to $28.88.
MSCI's benchmark for global equity markets .MIWD00000PUS rose 1.47% to 652.35.
On Wall Street, the Dow Jones Industrial Average .DJI rose 0.76%, the S&P 500 .SPX gained 1.61% and the Nasdaq Composite .IXIC added 2.55%.
The U.S. dollar bounced to a two-week high on weakness in the euro, Swiss franc and Japanese yen on the view that the United States has an advantage in growing its economy and vaccinating its population against COVID-19.
The euro weakened after Germany reported that retail sales plunged by an unexpected 9.6% in December after tighter lockdowns last year to curb the spread of COVID-19 choked consumer spending in Europe's largest economy.
The dollar index =USD rose 0.461%, with the euro EUR= down 0.66% to $1.2056.
The Japanese yen JPY= weakened 0.25% versus the greenback at 104.94 per dollar.
Oil prices rose, buoyed by shrinking inventories and hopes of a swifter global economic recovery, though halting vaccine rollouts and renewed travel restrictions capped gains.
Brent crude futures LCOc1 settled up $1.31 at $56.35 a barrel. U.S. crude futures CLc1 rose $1.35 to settle at $53.55 a barrel.
Gold XAU followed silver higher, up 0.77% to $1,860.22 an ounce. U.S. gold futures GCv1 settled up 0.7% at $1,863.90.
Data overnight showed Chinese factory activity slowed in January as restrictions took a toll in some regions. In the euro zone, manufacturing growth remained resilient at the start of the year but the pace waned from December.
British data showed an even greater struggle, with manufacturers facing the twin headwinds of COVID-19 and Britain's exit from the European Union.
While the coronavirus vaccine rollout globally remains slow, with concern about whether they will work on new COVID strains, Europe was also bolstered by news that it would receive a further 9 million doses from AstraZeneca in the first quarter.
With riskier markets bouncing, Italian government bond yields fell 2-3 basis points across the curve IT10YT=RR.
German Bund yields, meanwhile, the benchmark for the euro zone, remained anchored around -0.51% on Monday, tracking U.S. Treasury yields. DE10YT=RR. The 10-year U.S. Treasury US10YT=RR note fell 2.8 basis points to yield 1.0672%.
Asia stock marketshttps://tmsnrt.rs/2zpUAr4
Asia-Pacific valuationshttps://tmsnrt.rs/2Dr2BQA
Silver has outperformed gold in price terms and in ETF holdgings in recent monthshttps://tmsnrt.rs/39CYA9y
Excess money?https://tmsnrt.rs/2YpThUB
(Reporting by Herbert Lash; Editing by Richard Chang)
((herb.lash@thomsonreuters.com; 1-646-223-6019; Reuters Messaging: herb.lash.reuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers on the FTSE 100 .FTSE in London, with the blue-chip index closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic and left precious metals dealers scrambling for bars and coins to meet demand.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers on the FTSE 100 .FTSE in London, with the blue-chip index closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic and left precious metals dealers scrambling for bars and coins to meet demand.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers on the FTSE 100 .FTSE in London, with the blue-chip index closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. Silver has gained 19% in price since Thursday after posts on Reddit led small investors to buy silver mining stocks and exchange-traded funds (ETF) backed by physical silver bars, in a GameStop-style squeeze.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers on the FTSE 100 .FTSE in London, with the blue-chip index closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. "If you start pushing silver higher, that is going to have effects on other industries and other markets and that is clearly what happened."
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4738.0
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2021-02-01 00:00:00 UTC
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GLOBAL MARKETS-Shares rally, retail surge drives silver to 8-year high
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AAL
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https://www.nasdaq.com/articles/global-markets-shares-rally-retail-surge-drives-silver-to-8-year-high-2021-02-01-1
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nan
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nan
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By Herbert Lash
NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high.
A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic, with a 7.2% jump in the iShares Silver Trust ETF SLV.N - the largest silver-backed ETR - put it on track for its best day since 2008.
Data for the ETF showed its silver holdings jumped by a record 37 million shares from Thursday to Friday alone, each representing an ounce of silver.
Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers to the FTSE 100 .FTSE in London, with the blue-chip closing up 0.92%.
Miner Fresnillo FRES.L rose 8.95% to 1,076 to help lead the pan-European STOXX 600 index .STOXX gain 1.24%.
On Wall Street, nine of the 11 major S&P sectors advanced, with technology .SPLRCT leading the rally.
Silver prices XAG= surged to an eight-year high of just over $30 an ounce, before paring gains to trade 6.3% higher at $28.70.
The social media trading frenzy drove huge gains in companies such as GameStop Corp GME.N last week, forcing hedge funds to cover their short positions and sparking volatility on Wall Street. The three main stock indexes posted their biggest weekly declines since October.
GameStop GME.N fell 27.31% to $236.23.
"Silver has knock-on effects compared to GameStop because it has links to miners," said Connor Campbell, a financial analyst at SpreadEx. "If you start pushing silver higher, that is going to have effects on other industries and other markets and that is clearly what happened."
Silver has gained 19% in price since Thursday after posts on Reddit led small investors to buy silver mining stocks and exchange-traded funds (ETF) backed by physical silver bars, in a GameStop-style squeeze.
Spot silver XAG= was up 6.33% to $28.71.
MSCI's benchmark for global equity markets .MIWD00000PUS rose 1.6% to 653.19.
On Wall Street, the Dow Jones Industrial Average .DJI rose 1.06%, the S&P 500 .SPX gained 1.82% and the Nasdaq Composite .IXIC added 2.67%.
The U.S. dollar bounced to a 2-week high on weakness in the euro, Swiss franc and Japanese yen on the view that the United States has an advantage in growing its economy and vaccinating its population against COVID-19.
The euro weakened after Germany reported that retail sales plunged by an unexpected 9.6% in December after tighter lockdowns last year to curb the spread of COVID-19 choked consumer spending in Europe's largest economy.
The dollar index =USD rose 0.393%, with the euro EUR= down 0.59% to $1.2064.
The Japanese yen JPY= weakened 0.25% versus the greenback at 104.92 per dollar.
Oil prices rose, buoyed by shrinking inventories and hopes of a swifter global economic recovery, although halting vaccine rollouts and renewed travel restrictions capped gains.
Brent crude futures LCOc1 settled up $1.31 at $56.35 a barrel. U.S. crude futures CLc1 rose $1.35 to settle at $53.55 a barrel.
Gold XAU followed silver higher, up 0.70% to $1,859.05 an ounce. U.S. gold futures GCv1 settled up 0.7% at $1,863.90.
Data overnight showed Chinese factory activity slowed in January as restrictions took a toll in some regions. In the euro zone, manufacturing growth remained resilient at the start of the year but the pace waned from December.
British data showed an even greater struggle, with manufacturers facing the twin headwinds of COVID-19 and Britain's exit from the European Union.
While the coronavirus vaccine rollout globally remains slow, with concern about whether they will work on new COVID strains, Europe was also bolstered by news that it would receive a further 9 million doses from AstraZeneca in the first quarter.
With riskier markets bouncing, Italian government bond yields fell 2-3 basis points across the curve IT10YT=RR.
German Bund yields, meanwhile, the benchmark for the euro zone, remained anchored around -0.51% on Monday, tracking U.S. Treasury yields. DE10YT=RR. The 10-year U.S. Treasury US10YT=RR note traded to yield 1.0723%.
Asia stock marketshttps://tmsnrt.rs/2zpUAr4
Asia-Pacific valuationshttps://tmsnrt.rs/2Dr2BQA
Silver has outperformed gold in price terms and in ETF holdgings in recent monthshttps://tmsnrt.rs/39CYA9y
Excess money?https://tmsnrt.rs/2YpThUB
(Reporting by Herbert Lash; Editing by Richard Chang)
((herb.lash@thomsonreuters.com; 1-646-223-6019; Reuters Messaging: herb.lash.reuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers to the FTSE 100 .FTSE in London, with the blue-chip closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. The social media trading frenzy drove huge gains in companies such as GameStop Corp GME.N last week, forcing hedge funds to cover their short positions and sparking volatility on Wall Street.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers to the FTSE 100 .FTSE in London, with the blue-chip closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic, with a 7.2% jump in the iShares Silver Trust ETF SLV.N - the largest silver-backed ETR - put it on track for its best day since 2008.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers to the FTSE 100 .FTSE in London, with the blue-chip closing up 0.92%. By Herbert Lash NEW YORK, Feb 1 (Reuters) - Global shares rebounded from last week's steep sell-off and silver prices surged on Monday as retail investors expanded their social media-fueled battle with Wall Street to drive the precious metal to an eight-year high. A shift in the retail trading frenzy to silver drove up mining stocks on both sides of the Atlantic, with a 7.2% jump in the iShares Silver Trust ETF SLV.N - the largest silver-backed ETR - put it on track for its best day since 2008.
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Mining behemoths BHP Group BHPB.L, Glencore Plc GLEN.L and Anglo American Plc AAL.L were the top six gainers to the FTSE 100 .FTSE in London, with the blue-chip closing up 0.92%. Data for the ETF showed its silver holdings jumped by a record 37 million shares from Thursday to Friday alone, each representing an ounce of silver. "If you start pushing silver higher, that is going to have effects on other industries and other markets and that is clearly what happened."
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4739.0
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2021-02-01 00:00:00 UTC
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Pre-Market Most Active for Feb 1, 2021 : AMC, NOK, AG, IFF, ASPL, GME, AAPL, AAL, SQQQ, CNCE, BCRX, QQQ
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AAL
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https://www.nasdaq.com/articles/pre-market-most-active-for-feb-1-2021-%3A-amc-nok-ag-iff-aspl-gme-aapl-aal-sqqq-cnce-bcrx
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nan
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nan
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The NASDAQ 100 Pre-Market Indicator is up 144.78 to 13,070.16. The total Pre-Market volume is currently 31,746,126 shares traded.
The following are the most active stocks for the pre-market session:
AMC Entertainment Holdings, Inc. (AMC) is +2.65 at $15.91, with 34,313,945 shares traded. AMC's current last sale is 397.75% of the target price of $4.
Nokia Corporation (NOK) is +0.36 at $4.92, with 12,538,813 shares traded.NOK is scheduled to provide an earnings report on 2/4/2021, for the fiscal quarter ending Dec2020. The consensus earnings per share forecast is 0.12 per share, which represents a 17 percent increase over the EPS one Year Ago
First Majestic Silver Corp. (AG) is +6.57 at $24.69, with 4,919,154 shares traded. As reported by Zacks, the current mean recommendation for AG is in the "buy range".
International Flavors & Fragrances, Inc. (IFF) is +15.11 at $127.49, with 2,520,117 shares traded. As reported by Zacks, the current mean recommendation for IFF is in the "buy range".
Aspirational Consumer Lifestyle Corp. (ASPL) is +0.77 at $11.30, with 1,929,855 shares traded.
Gamestop Corporation (GME) is -7 at $318.00, with 1,822,335 shares traded. GME's current last sale is 2,271.43% of the target price of $14.
Apple Inc. (AAPL) is +1.79 at $133.75, with 1,798,964 shares traded. Over the last four weeks they have had 7 up revisions for the earnings forecast, for the fiscal quarter ending Mar 2021. The consensus EPS forecast is $1. As reported by Zacks, the current mean recommendation for AAPL is in the "buy range".
American Airlines Group, Inc. (AAL) is +0.19 at $17.36, with 1,597,580 shares traded. AAL's current last sale is 138.88% of the target price of $12.5.
ProShares UltraPro Short QQQ (SQQQ) is -0.4401 at $14.27, with 1,579,883 shares traded. This represents a 11.4% increase from its 52 Week Low.
Concert Pharmaceuticals, Inc. (CNCE) is -5.47 at $5.00, with 1,196,304 shares traded. As reported by Zacks, the current mean recommendation for CNCE is in the "strong buy range".
BioCryst Pharmaceuticals, Inc. (BCRX) is +1.8 at $10.32, with 1,095,022 shares traded. As reported in the last short interest update the days to cover for BCRX is 7.979836; this calculation is based on the average trading volume of the stock.
Invesco QQQ Trust, Series 1 (QQQ) is +3.35 at $317.91, with 906,526 shares traded. This represents a 92.75% increase from its 52 Week Low.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group, Inc. (AAL) is +0.19 at $17.36, with 1,597,580 shares traded. AAL's current last sale is 138.88% of the target price of $12.5. Nokia Corporation (NOK) is +0.36 at $4.92, with 12,538,813 shares traded.NOK is scheduled to provide an earnings report on 2/4/2021, for the fiscal quarter ending Dec2020.
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American Airlines Group, Inc. (AAL) is +0.19 at $17.36, with 1,597,580 shares traded. AAL's current last sale is 138.88% of the target price of $12.5. The total Pre-Market volume is currently 31,746,126 shares traded.
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American Airlines Group, Inc. (AAL) is +0.19 at $17.36, with 1,597,580 shares traded. AAL's current last sale is 138.88% of the target price of $12.5. The total Pre-Market volume is currently 31,746,126 shares traded.
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American Airlines Group, Inc. (AAL) is +0.19 at $17.36, with 1,597,580 shares traded. AAL's current last sale is 138.88% of the target price of $12.5. As reported by Zacks, the current mean recommendation for AG is in the "buy range".
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4740.0
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2021-02-01 00:00:00 UTC
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3 Stocks to Avoid This Week
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AAL
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https://www.nasdaq.com/articles/3-stocks-to-avoid-this-week-2021-02-01
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nan
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nan
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I'm here to take my lumps. I took a look at three stocks to avoid last week, predicting that American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop (NYSE: GME) were going to have a challenging week. If you followed the GameStop sage you already know how badly I wiped out.
American Airlines reported a brutal quarter, but it wasn't enough to stop the high-flying shares. The stock soared nearly 9% for the week.
Tesla was the lone stock to slide, shifting into reverse for a better than 6% decline. It was a rough week for the country's fifth most valuable company by market cap, falling short with its quarterly earnings report.
GameStop -- oh, GameStop -- you sank my battleship. The video game retailer skyrocketed 400%. I'll have some more to say about GameStop shortly, but wow did I get this one wrong.
The three stocks averaged a 134% advance. I blew it, of course. Naturally the S&P 500's 3.3% dip fell well short of GameStop's hedge fund-smashing run. This week, I see ExxonMobil (NYSE: XOM), Chuy's (NASDAQ: CHUY), and GameStop as vulnerable investments in the near term. Here's why I think these are three stocks to avoid this week.
Image source: Getty Images.
ExxonMobil
If you want to know what's fueling ExxonMobil these days check back on Tuesday morning when the oil and gas giant reports its fourth-quarter results. It's not going to be pretty. Analysts see ExxonMobil barely breaking even on a 27% year-over-year plunge in revenue.
What ails the industry bellwether that at one time commanded the country's largest market cap isn't a mystery. Oil demand has tanked, taking prices down in the process. The pandemic obviously is only hurting our drive time, but improving gas efficiency in cars and a global shift to electric vehicles make it hard to buy into a bullish scenario for ExxonMobil. The stock didn't lose more than 40% of its value last year by accident.
Activists are rattling the boardroom, but these aren't the kind of activists that will increase shareholder value. These activists want ExxonMobil to beef up its sustainability initiatives and reduce its carbon footprint, noble endeavors but naturally things that won't improve its fundamentals.
ExxonMobil's 7.6% yield is going to turn heads, but that's dangerous when you should be looking at the road ahead. ExxonMobil hasn't raised its dividend in two years, and with many of its peers recently slashing payouts we know which way these distributions are heading. ExxonMobil will try to spin its sluggish ways and paint a rosier picture of the future, but all I see are fumes.
Chuy's
When shares of Chuy's hit fresh 52-week highs late last week I probably wasn't the only one scratching my head. I am mostly a fan of the Tex-Mex casual dining chain. Keep a steady supply of tortilla chips and creamy jalapeno dipping sauce coming and I'm a happy camper. The problem here is where Chuy's is on its turnaround.
There are only a couple of publicly traded eateries that have turned the corner in this climate, and Chuy's isn't one of them. Analysts see revenue plummeting 25% for both its latest quarter and all of 2020. It hasn't been able to hop on the digital ordering platform with the same success as some of the market leaders. Growth has slowed to a crawl for the 92-unit chain, and recently it closed all of of its three locations in the Miami market after jumping into the area just three years ago.
GameStop
I'll start with any disclaimer that is probably necessary in talking about this particular stock: GameStop is a dangerous stock to own. It's an even more dangerous stock to short. Value investing icon Benjamin Graham famously said that in the short run the market is a voting machine, but in the long run it's a weighing machine. Right now the polls are undeniably open.
GameStop is a cause more than an investment. It's not a $13.5 billion company by any realistic valuation metric. GameStop stock's underlying investment isn't a business right now. It's a message. Moreover it's an evolving message.
A whopping 558.9 million shares were traded last week for a stock with 69.7 million shares outstanding. The same shorts that retail investors were hating a week ago have been squeezed out. Those long the stock that had made their shares available have moved on, too. For all of the "hold the line" rhetoric, the volume suggests that speculators are just playing with the stock before flipping it within a day or two. There's a larger story that will play out over time, but with story itself continuing to change rapidly there will come a time when the polls close and the weigh scales roll back into place.
If you're looking for safe stocks, you aren't likely to find them in American Airlines, DoorDash, or GameStop this week.
10 stocks we like better than ExxonMobil
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and ExxonMobil wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Rick Munarriz has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Chuys Holdings and Tesla. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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I took a look at three stocks to avoid last week, predicting that American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop (NYSE: GME) were going to have a challenging week. The pandemic obviously is only hurting our drive time, but improving gas efficiency in cars and a global shift to electric vehicles make it hard to buy into a bullish scenario for ExxonMobil. These activists want ExxonMobil to beef up its sustainability initiatives and reduce its carbon footprint, noble endeavors but naturally things that won't improve its fundamentals.
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I took a look at three stocks to avoid last week, predicting that American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop (NYSE: GME) were going to have a challenging week. This week, I see ExxonMobil (NYSE: XOM), Chuy's (NASDAQ: CHUY), and GameStop as vulnerable investments in the near term. A whopping 558.9 million shares were traded last week for a stock with 69.7 million shares outstanding.
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I took a look at three stocks to avoid last week, predicting that American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop (NYSE: GME) were going to have a challenging week. GameStop I'll start with any disclaimer that is probably necessary in talking about this particular stock: GameStop is a dangerous stock to own. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Rick Munarriz has no position in any of the stocks mentioned.
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I took a look at three stocks to avoid last week, predicting that American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop (NYSE: GME) were going to have a challenging week. GameStop is a cause more than an investment. The same shorts that retail investors were hating a week ago have been squeezed out.
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4741.0
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2021-02-01 00:00:00 UTC
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3 Fallen Angel Stocks That Could Double in 2021
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AAL
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https://www.nasdaq.com/articles/3-fallen-angel-stocks-that-could-double-in-2021-2021-02-01
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nan
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nan
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The stock market performed quite well in 2020, bouncing back from its worst levels in March to power ahead to strong gains. Many stocks more than doubled in price, sending their valuations to lofty heights.
However, there were some stocks that weren't so lucky. Hard-hit areas like aerospace, banking, and energy weren't able to claw back their losses, as the impacts of the COVID-19 pandemic and other factors combined to keep their share prices lower than where they'd started the year.
Image source: Getty Images.
As 2021 begins, though, some of these fallen angels are starting to perk up. Even though they've clawed back some of their lost ground, these three stocks have a lot of room to rise further -- and could potentially double in value by the end of the year.
1. Sabre
Sabre (NASDAQ: SABR) is a software and technology company, but in what was a good year for the tech sector broadly, the Texas-based company found itself in just about the worst possible position in 2020. Sabre is a former subsidiary of American Airlines Group (NASDAQ: AAL), specializing in helping the global travel industry function more efficiently.
Historically, Sabre's airline operations, booking management, and hospitality solutions platforms have been stalwart producers of revenue and profits. However, with the airline industry crushed by pandemic-related travel restrictions, Sabre saw its own business prospects sink dramatically. Sales plunged 92% in the second quarter of 2020, with losses in the first nine months of the year adding up to more than $965 million.
Yet Sabre is positioning itself for a bounce in airline and travel activity. Late last year, the company partnered with Alphabet's (NASDAQ: GOOGL) (NASDAQ: GOOG) Google unit to launch the artificial intelligence-driven Sabre Travel AI platform. Sabre and Google intend for the platform to offer customers personalized content to boost margins. As investors see that Sabre can put the past behind it and return toward a more sustainable growth trajectory, the stock could move higher -- and just getting back to where shares started 2020 would represent a double from here.
2. Schlumberger
The energy industry took a lot of damage in 2020, and plunging oil prices didn't just hurt oil and gas exploration and production companies. Schlumberger (NYSE: SLB) is a leading global player in oilfield services, and with so many E&P companies struggling to make ends meet, the first place they cut their budgets was in adding production capacity.
The result was another terrible year financially for Schlumberger. Revenue fell 28% in 2020 from 2019 levels, and a second straight year of massive impairment charges pushed Schlumberger's losses above the $10 billion mark for the second straight year.
Now, however, energy has started to rebound. Oil prices have moved back above $50 per barrel, and some E&P companies are beginning to look more actively at resuming their exploratory activities. That's good news for Schlumberger and other oilfield services providers, and with Schlumberger stock having fetched triple its current price as recently as mid-2018, asking for a double from here doesn't seem like too much to expect.
3. Wells Fargo
Last up is Wells Fargo (NYSE: WFC). 2020 was a tough year in the banking industry, but Wells has seen plenty of difficulty for several years now.
Wells Fargo has been hamstrung by regulators at the Federal Reserve because of the many scandals in which the California-based bank has been involved in recent years. The Fed has put limits on Wells Fargo's asset base, preventing it from growing even as other institutions take advantage of new lending opportunities. Meanwhile, low interest rates have crushed income levels from the bank's most prevalent source of profit. All of that has hurt revenue, and ballooning loan loss provisions in 2020 took an even deeper bite to the bottom line, as full-year 2020 earnings plummeted well over 80%.
Now, Wells Fargo sees the potential for better times ahead. Bringing the pandemic under control would have a huge impact on loan loss reserve needs and jump start commercial activity. The bank also expects to restart its stock buyback program in 2021, which could provide a key source of support for the stock price. Add to that the possibility that the Fed might finally decide the bank has suffered enough, and you'd have the pieces in place to send the stock price doubling to its best levels since 2018.
High risk, high reward
These three stocks went through extremely tough times in 2020. Their share prices fell for a reason, and the companies remain riskier than many of their peers in the stock market. If they can get their acts together and start executing more effectively again, however, then Wells Fargo, Schlumberger, and Sabre all have the potential to see their share prices double.
10 stocks we like better than Wells Fargo
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Wells Fargo wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Dan Caplinger owns shares of Alphabet (A shares). The Motley Fool owns shares of and recommends Alphabet (A shares) and Alphabet (C shares). The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Sabre is a former subsidiary of American Airlines Group (NASDAQ: AAL), specializing in helping the global travel industry function more efficiently. Hard-hit areas like aerospace, banking, and energy weren't able to claw back their losses, as the impacts of the COVID-19 pandemic and other factors combined to keep their share prices lower than where they'd started the year. As investors see that Sabre can put the past behind it and return toward a more sustainable growth trajectory, the stock could move higher -- and just getting back to where shares started 2020 would represent a double from here.
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Sabre is a former subsidiary of American Airlines Group (NASDAQ: AAL), specializing in helping the global travel industry function more efficiently. Schlumberger The energy industry took a lot of damage in 2020, and plunging oil prices didn't just hurt oil and gas exploration and production companies. That's good news for Schlumberger and other oilfield services providers, and with Schlumberger stock having fetched triple its current price as recently as mid-2018, asking for a double from here doesn't seem like too much to expect.
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Sabre is a former subsidiary of American Airlines Group (NASDAQ: AAL), specializing in helping the global travel industry function more efficiently. Hard-hit areas like aerospace, banking, and energy weren't able to claw back their losses, as the impacts of the COVID-19 pandemic and other factors combined to keep their share prices lower than where they'd started the year. Sabre Sabre (NASDAQ: SABR) is a software and technology company, but in what was a good year for the tech sector broadly, the Texas-based company found itself in just about the worst possible position in 2020.
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Sabre is a former subsidiary of American Airlines Group (NASDAQ: AAL), specializing in helping the global travel industry function more efficiently. Yet Sabre is positioning itself for a bounce in airline and travel activity. That's good news for Schlumberger and other oilfield services providers, and with Schlumberger stock having fetched triple its current price as recently as mid-2018, asking for a double from here doesn't seem like too much to expect.
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4742.0
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2021-02-01 00:00:00 UTC
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Miners push British stocks higher; ASOS gains on Arcadia deal
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AAL
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https://www.nasdaq.com/articles/miners-push-british-stocks-higher-asos-gains-on-arcadia-deal-2021-02-01
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nan
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nan
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By Shashank Nayar, Amal S and Shivani Kumaresan
Feb 1 (Reuters) - British shares rose on Monday, led by gains in mining stocks as silver became the latest target of a retail investor trading frenzy, while fashion retailer ASOS gained on a deal to buy rival brands and JD Sports surged following its second acquisition in the United States.
The blue-chip FTSE 100 index .FTSE gained 0.9%, recovering from its worst session in three months, with miners .FTNMX1770 and construction stocks .FTNMX2350 gaining the most. The mid-cap index .FTMC added 0.8%.
BHP Group BHPB.L, Rio Tinto RIO.L and Anglo American AAL.L were the top gainers in the FTSE 100 index.
Silver prices XAG= surged to an eight-year high, silver-mining stocks leapt and bullion dealers were scrambling as small-time investors piled in to the metal. [nL1N2K60M1]
"I still think there is difficult times ahead as far as the markets are concerned though it is a positive start to the month with the moves in mining stocks giving a lift," said Craig Erlam, senior market analyst at OANDA.
British manufacturers suffered a double hit last month as COVID-19 disruption to global shipping combined with new trade barriers with the European Union, a survey showed.
The FTSE 100 has recovered nearly 30% from its March 2020 lows and is 15% away from its highest point last year, led by stimulus support and re-opening optimism, but a recent surge in coronavirus infections and fresh lockdowns capped further gains.
Shares of ASOS ASOS.L gained 6.9% after the fashion retailer's acquisition of Topshop, Topman, Miss Selfridge and HIIT brands from the administrators of Philip Green's collapsed Arcadia group for 265 million pounds ($364 million).
Britain's biggest sportswear retailer JD Sports JD.L jumped 7.0% on a takeover deal to buy DTLR Villa, its second acquisition in the United States, as the retailer expands its business on the west coast.
(Reporting by Shashank Nayar, Amal S and Shivani Kumaresan in Bengaluru; Editing by Shounak Dasgupta, Uttaresh.V and Jane Merriman)
((Shashank.Nayar@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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BHP Group BHPB.L, Rio Tinto RIO.L and Anglo American AAL.L were the top gainers in the FTSE 100 index. Silver prices XAG= surged to an eight-year high, silver-mining stocks leapt and bullion dealers were scrambling as small-time investors piled in to the metal. British manufacturers suffered a double hit last month as COVID-19 disruption to global shipping combined with new trade barriers with the European Union, a survey showed.
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BHP Group BHPB.L, Rio Tinto RIO.L and Anglo American AAL.L were the top gainers in the FTSE 100 index. By Shashank Nayar, Amal S and Shivani Kumaresan Feb 1 (Reuters) - British shares rose on Monday, led by gains in mining stocks as silver became the latest target of a retail investor trading frenzy, while fashion retailer ASOS gained on a deal to buy rival brands and JD Sports surged following its second acquisition in the United States. The blue-chip FTSE 100 index .FTSE gained 0.9%, recovering from its worst session in three months, with miners .FTNMX1770 and construction stocks .FTNMX2350 gaining the most.
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BHP Group BHPB.L, Rio Tinto RIO.L and Anglo American AAL.L were the top gainers in the FTSE 100 index. By Shashank Nayar, Amal S and Shivani Kumaresan Feb 1 (Reuters) - British shares rose on Monday, led by gains in mining stocks as silver became the latest target of a retail investor trading frenzy, while fashion retailer ASOS gained on a deal to buy rival brands and JD Sports surged following its second acquisition in the United States. The blue-chip FTSE 100 index .FTSE gained 0.9%, recovering from its worst session in three months, with miners .FTNMX1770 and construction stocks .FTNMX2350 gaining the most.
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BHP Group BHPB.L, Rio Tinto RIO.L and Anglo American AAL.L were the top gainers in the FTSE 100 index. By Shashank Nayar, Amal S and Shivani Kumaresan Feb 1 (Reuters) - British shares rose on Monday, led by gains in mining stocks as silver became the latest target of a retail investor trading frenzy, while fashion retailer ASOS gained on a deal to buy rival brands and JD Sports surged following its second acquisition in the United States. The blue-chip FTSE 100 index .FTSE gained 0.9%, recovering from its worst session in three months, with miners .FTNMX1770 and construction stocks .FTNMX2350 gaining the most.
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4743.0
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2021-01-31 00:00:00 UTC
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Wall St Week Ahead-Sideshow or main event? GameStop stock ride weighed as bubble warning
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AAL
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https://www.nasdaq.com/articles/wall-st-week-ahead-sideshow-or-main-event-gamestop-stock-ride-weighed-as-bubble-warning-0
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nan
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nan
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By Lewis Krauskopf
NEW YORK, Jan 31 (Reuters) - Some investors are growing concerned that wild swings in GameStop GME.N and other stocks driven by small-time traders could be fresh signs of overexuberance that foreshadow volatility for the broader stock market.
GameStop shares closed up 400% for the week after the video game chain's stock became a battleground between retail traders and Wall Street professionals, a tussle that captivated investors the world over.
Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year.
Fed Chairman Jerome Powell earlier this week pushed back on suggestions that the central bank's super-low interest rates and massive bond purchases were creating asset bubbles.
But those comments failed to quell some investors' worries that the Fed's monetary policy has encouraged excessive risk-taking across broader markets: The S&P 500 .SPX is up 66% since March and stocks stand near their highest valuations in two decades.
The action in GameStop and other stocks “definitely gives us some cause for concern," said James Ragan, director of wealth management research at D.A. Davidson. "At the very least, you have to consider that there's a chance of a market correction."
The moves also drew some comparisons to the internet stock mania two decades earlier.
"Just the fact that you have a group of investors that are really chasing abnormal gains, that’s what is reminiscent of the dot-com bubble,” Ragan said.
Some barometers of general over-exuberance are already flashing: Citi said its “Panic/Euphoria” model is in "elevated euphoric territory." And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets.
The frenzied trading dominated the news on Wall Street this week, even as Apple Inc AAPL.O, Microsoft Corp MSFT.O and other corporate heavyweights reported quarterly results. The S&P 500 fell 3.3% for the week, with trading volume surging above 24 billion shares on Wednesday, well above the 14.4 billion-share average of the past 20 sessions. The CBOE volatility index .VIX closed above 30 points this week for the first time since early November.
One potential catalyst for further volatility could come if hedge funds are forced to sell out of positions in order to cover failed short selling bets, although it was unclear whether there would be enough of such selling to create a broad risk to equities.
Already, some short-selling hedge funds appeared to be changing their approach. Short seller Andrew Left, whose company Citron Research was one of the hedge funds to spark this week’s battle with small-time traders over GameStop Corp, said in a YouTube video on Friday that his company would no longer publish short selling research.
Others said the ramped-up activity of retail investors - who last year helped drive rallies in shares of Tesla Inc TSLA.O and other names - could in itself be the latest sign of market frothiness.
“When you think about market bubbles, the last players that jump on board are retail, and that is generally what is happening right now,” said Mike Mullaney, director of global markets research at Boston Partners.
Analysts at LPL Financial doubt the recent ructions in GameStop and other names indicate a broader market bubble, noting that market breadth - which measures how many stocks are participating in a rally - remains healthy and credit markets are functioning "just fine."
"Maybe it is simply time for a break" in the S&P 500's rally, the firm said in a report Friday.
Others, though, pointed to potential market turbulence ahead.
Stephen Suttmeier, technical research strategist at BofA Global Research, earlier this week urged clients to "take some profits" ahead of February, a comparatively weak month for stocks.
Other worrisome signs are the explosion of special purpose acquisition companies, or SPACs, and the surge in shares of electric vehicle companies on the heels of Tesla's gains, said Scott Schermerhorn, chief investment officer at Granite Investment Advisors.
Still, he believes the frenzy over GameStop and other stocks is more of a "sideshow."
Even after their rallies, the market capitalization of GameStop and other companies that have recently seen their stocks soar are "like a rounding error" compared with the broader market, he said.
(Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Jonathan Oatis)
((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters Messaging: lewis.krauskopf.thomsonreuters.com@reuters.net, Twitter: @LKrauskopf))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. Fed Chairman Jerome Powell earlier this week pushed back on suggestions that the central bank's super-low interest rates and massive bond purchases were creating asset bubbles. But those comments failed to quell some investors' worries that the Fed's monetary policy has encouraged excessive risk-taking across broader markets: The S&P 500 .SPX is up 66% since March and stocks stand near their highest valuations in two decades.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets. Analysts at LPL Financial doubt the recent ructions in GameStop and other names indicate a broader market bubble, noting that market breadth - which measures how many stocks are participating in a rally - remains healthy and credit markets are functioning "just fine."
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. By Lewis Krauskopf NEW YORK, Jan 31 (Reuters) - Some investors are growing concerned that wild swings in GameStop GME.N and other stocks driven by small-time traders could be fresh signs of overexuberance that foreshadow volatility for the broader stock market. Short seller Andrew Left, whose company Citron Research was one of the hedge funds to spark this week’s battle with small-time traders over GameStop Corp, said in a YouTube video on Friday that his company would no longer publish short selling research.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. GameStop shares closed up 400% for the week after the video game chain's stock became a battleground between retail traders and Wall Street professionals, a tussle that captivated investors the world over. And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets.
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4744.0
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2021-01-30 00:00:00 UTC
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American Airlines Earnings: Still Treading Water
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AAL
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https://www.nasdaq.com/articles/american-airlines-earnings%3A-still-treading-water-2021-01-30
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nan
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nan
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In recent years, American Airlines Group (NASDAQ: AAL) has been a chronic underperformer within the airline industry. That didn't change during 2020, a year defined by the pandemic.
On Thursday, American reported another quarter of financial results that were weak (albeit slightly better than feared). And while management is touting various actions to cut costs and boost profitability, American Airlines' massive debt load is likely to hobble the company's performance for the foreseeable future.
Cash burn continues
American generated $4 billion in revenue last quarter and posted an adjusted net loss of $2.2 billion ($3.86 per share). Both metrics were slightly better than analysts' expectations. That said, while American produced the most revenue of any U.S. airline in the fourth quarter, it also lost the most money.
Furthermore, while its cash burn slowed sequentially, the company still burned an average of $30 million of cash per day last quarter, equivalent to a staggering $11 billion annually. By contrast, Delta Air Lines (which is similar in size) limited its fourth-quarter cash burn to an average of $12 million per day.
Management expects cash burn to continue at a pace of around $30 million per day during the first quarter (which includes $9 million per day of debt and severance payments). Luckily for the company, the government is effectively picking up the tab in the first quarter. American Airlines expects to receive $3.1 billion of payroll support funds this quarter, including $2.2 billion of outright grants.
Image source: American Airlines.
Can cost-cutting fix American's problems?
During theearnings callthis week, management said that the company had implemented $1.3 billion of permanent structural cost cuts. American has finally slimmed down its previously bloated management structure.
It has also accelerated fleet upgrades that will allow it to carry the same amount of traffic with fewer airplanes and much less complexity. Importantly, the Boeing 737 MAX's return to service should also help the company's cost structure relative to 2019.
Bulls may hope that these cuts will allow American Airlines to emerge from the pandemic in a stronger position. But the COVID-19 crisis has pushed every major airline to critically reexamine its cost structure. They will all emerge from the pandemic with lower costs. That will lead to lower fares in the future (all else equal) due to the nature of free-market competition.
Unless American has reduced its costs more than its peers, its profitability is unlikely to be higher than it was before the pandemic. Alas, there's no sign that it's cutting costs any faster than other big airlines. For example, United Airlines announced earlier this month that it had identified $2 billion of annualized structural cost reductions.
High debt and stock sales loom over shareholders
Even if American Airlines eventually does manage to improve on its subpar pre-pandemic margins, it will take a few years to reach that new normal. When it gets there, it will have to cope with a dreadful balance sheet.
Entering 2020, American had $39.5 billion of debt and pension liabilities, which was already the heaviest debt load among major U.S. airlines. By year-end, it had more than $48 billion of debt, lease, and pension obligations, offset by $6.9 billion of unrestricted cash and investments.
American has been steadily selling new shares of stock to raise cash, which is a prudent move. That said, it dilutes existing shareholders' stakes in the company, reducing the stock's upside potential. Moreover, unless the carrier ramps up stock sales further, its net debt will continue to rise in 2021, due to its underlying cash burn and new aircraft deliveries (which will be financed by new debt and lease obligations).
American Airlines' high debt load will force it to spend virtually all of its free cash flow on debt reduction for the foreseeable future. Add that to the massive dilution shareholders are experiencing, and there's no reason to invest in this troubled company today.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Adam Levine-Weinberg owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent years, American Airlines Group (NASDAQ: AAL) has been a chronic underperformer within the airline industry. And while management is touting various actions to cut costs and boost profitability, American Airlines' massive debt load is likely to hobble the company's performance for the foreseeable future. By contrast, Delta Air Lines (which is similar in size) limited its fourth-quarter cash burn to an average of $12 million per day.
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In recent years, American Airlines Group (NASDAQ: AAL) has been a chronic underperformer within the airline industry. And while management is touting various actions to cut costs and boost profitability, American Airlines' massive debt load is likely to hobble the company's performance for the foreseeable future. American Airlines' high debt load will force it to spend virtually all of its free cash flow on debt reduction for the foreseeable future.
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In recent years, American Airlines Group (NASDAQ: AAL) has been a chronic underperformer within the airline industry. And while management is touting various actions to cut costs and boost profitability, American Airlines' massive debt load is likely to hobble the company's performance for the foreseeable future. High debt and stock sales loom over shareholders Even if American Airlines eventually does manage to improve on its subpar pre-pandemic margins, it will take a few years to reach that new normal.
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In recent years, American Airlines Group (NASDAQ: AAL) has been a chronic underperformer within the airline industry. Cash burn continues American generated $4 billion in revenue last quarter and posted an adjusted net loss of $2.2 billion ($3.86 per share). During theearnings callthis week, management said that the company had implemented $1.3 billion of permanent structural cost cuts.
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4745.0
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2021-01-30 00:00:00 UTC
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5 Awful Stocks Robinhood Investors Can't Stop Buying
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AAL
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https://www.nasdaq.com/articles/5-awful-stocks-robinhood-investors-cant-stop-buying-2021-01-30
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nan
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nan
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Online investing app Robinhood is known for its numerous perks. This includes commission-free trading, the gifting of free shares of stock to new users, and the ability to buy fractional shares of companies listed on major U.S. exchanges.
But on Wall Street, the "Robinhood investor" is synonymous with millennial and/or novice investors who choose to chase penny stocks, momentum plays, and otherwise awful companies. Since the average age of Robinhood's users is 31, many fail to understand the power of compounding over the long run. As a result, Robinhood's leaderboard (the 100 most-held stocks on the platform) is packed with no shortage of terrible companies.
The following five companies are perfect examples of awful stocks Robinhood investors can't stop buying.
Image source: Getty Images.
GameStop
Is anyone really all that surprised to find multichannel video game and accessories retailer GameStop (NYSE: GME) among Robinhood's top 100? After being whipsawed violently over the past week, GameStop offers the wild volatility that young investors seem to crave.
On one hand, GameStop has made strides to improve its operations. It's been closing some of its physical locations to reduce its costs, all while emphasizing its digital gaming platform. For instance, the company's 2020 e-commerce holiday sales more than quadrupled from the previous year. Figures like this give hope to shareholders that an operating turnaround is possible for a company that's been reliant on its brick-and-mortar presence for decades.
On the other hand, the only substance behind GameStop's recent megarally looks to be a massive short squeeze (i.e., short-sellers, who want the stock to go down, getting pushed out of their position by the skyrocketing share price). GameStop has lost money in each of the past three years, and its sales continue to spiral downward. This isn't to say a turnaround isn't possible, but it's clearly not going to happen overnight.
With the recent short squeeze sending GameStop to an all-time high, Robinhood investors chasing this stock are playing with fire.
Image source: Getty Images.
Riot Blockchain
In recent months, anything that has to do with bitcoin has been virtually unstoppable, and that includes cryptocurrency stock Riot Blockchain (NASDAQ: RIOT).
Riot is a cryptocurrency miner that uses high-powered computers to solve equations that validate groups of transactions (a block) as accurate and true on bitcoin's blockchain. For doing this, Riot is given a block reward of 6.25 bitcoin tokens, which is worth about $203,000.
However, investing in Riot Blockchain comes with two significant concerns. First, there's minimal emphasis on innovation. Riot is almost entirely at the mercy of bitcoin and its wild vacillations. As I've stated on multiple occasions, I believe bitcoin to be flawed and the most dangerous investment of 2021. Also keep in mind that bitcoin has a history of entering protracted bear markets following parabolic moves higher.
Second, Riot Blockchain has little to currently offer investors. This is a $1.3 billion company that may not even reach $10 million in full-year revenue and has lost $16.6 million in back-to-back years through the first nine months of 2020 and 2019. There's nothing sustainable or guaranteed about crypto mining, especially when there's no barrier to entry.
The Nikola Badger was retired before it even rolled off the assembly line. Image source: Nikola.
Nikola
There's not a trend that Robinhood investors chase after more than alternative/green energy solutions. That includes electric vehicle (EV) auto stocks, all of which look grossly overvalued given the hurdles they still need to overcome. But the most dangerous of all might just be Nikola (NASDAQ: NKLA).
Though it was virtually unstoppable in June 2020, Nikola has been stuck in reverse for months. Much of this disappointment derives from losing out on a major partnership with General Motors (NYSE: GM). It was initially reported in early September that General Motors would take a $2 billion equity investment in Nikola and handle the production of the company's Badger EV, a hydrogen fuel-cell pickup truck. By December, the duo struck a toned-down deal that didn't involve an equity investment and caused Nikola to abandon the Badger.
To make matters worse, Nikola was hit with allegations of fraud and wrongdoing by a short-selling firm. These allegations proved to be enough for the Securities and Exchange Commission to open a probe into the company. And, as the icing the cake, the founder and former executive chairman of the board, Trevor Milton, stepped down via a middle-of-the-night tweet.
Nikola is a rudderless ship in choppy seas, and millennials keep chasing after it for some reason.
Image source: Getty Images.
Aurora Cannabis
Next to EVs, Robinhood investors' next-biggest obsession is with marijuana stocks. Since Robinhood doesn't allow its users to buy over-the-counter-listed stocks, they're left with an array of underperforming Canadian pot stocks on major U.S. exchanges. Somehow, young investors keep gravitating to the worst one of the bunch: Aurora Cannabis (NYSE: ACB).
Aurora has been hammered on all fronts. Canadian federal regulators delayed the launch of higher-margin derivatives in late 2019, and Ontario's provincial regulators have struggled to assign dispensary licenses in Canada's most-populous province. Meanwhile, Aurora overestimated the capacity that would be needed to satisfy demand in Canada, and grossly overpaid for roughly a dozen acquisitions completed since mid-2016. Long story short, the company continues to lose a boatload of money, and it wrote down roughly half of its total assets in the previous fiscal year.
If that's not enough to scare you away, perhaps this next statistic will do the trick. Having financed every deal with its common stock, and regularly issuing shares to pay for its day-to-day operations, Aurora Cannabis' outstanding share count has risen by at least 12,200% since June 2014. There's no way that investors can get ahead when management keeps diluting the daylights out of its shareholders.
Image source: America Airlines.
American Airlines Group
Among brand-name companies, American Airlines Group (NASDAQ: AAL) might be the biggest head-scratcher of them all. Of these five awful stocks, it's the only one currently in Robinhood's top 10.
I'm not entirely certain why, but millennials really like airline stocks. It's an industry that requires huge capital investments to produce only mediocre margins, at best. It also only thrives when the economy is growing. That's not the case during the coronavirus pandemic, and it's really exposed how weak American Airlines is, relative to its peers.
As of the end of September, American Airlines had more than $41 billion in outstanding debt and about $33 billion in net debt. Even if it has enough capital to survive the pandemic, the company's balance sheet will be weighed down by this added debt for a long time to come. This means no capital return program whatsoever (i.e., no share buybacks and no dividends).
As my Fool.com colleague Adam Levine-Weinberg pointed out in 2018, American Airlines also has a knack for making poor business decisions and wasted investors' money by upgrading its fleet well before it was necessary.
With high debt, weak margins, and no capital return program, there's no reason investors should be anywhere near American Airlines' stock.
10 stocks we like better than Aurora Cannabis Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Sean Williams has no position in any of the stocks or cryptocurrencies mentioned. The Motley Fool has no position in any of the stocks or cryptocurrencies mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Among brand-name companies, American Airlines Group (NASDAQ: AAL) might be the biggest head-scratcher of them all. It was initially reported in early September that General Motors would take a $2 billion equity investment in Nikola and handle the production of the company's Badger EV, a hydrogen fuel-cell pickup truck. Long story short, the company continues to lose a boatload of money, and it wrote down roughly half of its total assets in the previous fiscal year.
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American Airlines Group Among brand-name companies, American Airlines Group (NASDAQ: AAL) might be the biggest head-scratcher of them all. With the recent short squeeze sending GameStop to an all-time high, Robinhood investors chasing this stock are playing with fire. Riot Blockchain In recent months, anything that has to do with bitcoin has been virtually unstoppable, and that includes cryptocurrency stock Riot Blockchain (NASDAQ: RIOT).
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American Airlines Group Among brand-name companies, American Airlines Group (NASDAQ: AAL) might be the biggest head-scratcher of them all. But on Wall Street, the "Robinhood investor" is synonymous with millennial and/or novice investors who choose to chase penny stocks, momentum plays, and otherwise awful companies. Riot Blockchain In recent months, anything that has to do with bitcoin has been virtually unstoppable, and that includes cryptocurrency stock Riot Blockchain (NASDAQ: RIOT).
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American Airlines Group Among brand-name companies, American Airlines Group (NASDAQ: AAL) might be the biggest head-scratcher of them all. Image source: Nikola. Aurora Cannabis Next to EVs, Robinhood investors' next-biggest obsession is with marijuana stocks.
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4746.0
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2021-01-29 00:00:00 UTC
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4 Top Epicenter Stocks To Watch Amid Novavax’s Vaccine News
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AAL
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https://www.nasdaq.com/articles/4-top-epicenter-stocks-to-watch-amid-novavaxs-vaccine-news-2021-01-29
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nan
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nan
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Do You Have These Epicenter Stocks On Your List Next Month?
When you are looking for the best stocks to buy in the stock market today, some of the best investments can be found in epicenter stocks. So, you might ask, what exactly are epicenter stocks? Originally popularized by Fundstrat’s Tom Lee, epicenter stocks are those which have been beaten down the most by the coronavirus pandemic. They are also the ones that could become the fastest to recover in light of an economic reopening.
Many of the travel names might spike from time to time over positive vaccine and treatment news. But we know that these companies are still struggling to gain a strong footing. That’s simply because they have been burning hundreds of millions of dollars every month just to stay afloat. Having said that, you might be skeptical about putting your money into a list of the top epicenter stocks today. I get that. However, as the world moves forward with more vaccines being approved, things are looking up. For a start, investors could prepare themselves with companies that are now struggling but stand a good chance of pulling through.
Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) were among the earliest to receive approvals for their vaccines. And on Thursday, Novavax (NASDAQ: NVAX) said that its coronavirus vaccine was more than 89% effective in protecting against COVID-19 in its phase 3 trial conducted in the U.K. Now, with Novavax’s vaccine looking to be on track to join Pfizer’s and Moderna’s, would you prepare a list of the best epicenter stocks to buy before 2021?
Top Epicenter Stocks To Watch On February 2021
American Airlines (NASDAQ: AAL)
Carnival Corporation (NYSE: CCL)
Booking Holdings (NASDAQ: BKNG)
AMC Entertainment Holdings (NYSE: AMC)
American Airlines
First up, shares of American Airlines soared more than 20% at the opening after the company reported earnings Thursday morning. If you haven’t taken a look at it closely, you would have thought AAL reported better than expected earnings. But the truth is, it’s because Reddit investors believe that AAL stock may be the next GameStop. And why might that be the case? All that started from one user saying that AAL stock is majorly shorted while others aren’t.
American Airlines reported a net loss of $2.18 billion for the fourth quarter, compared with a profit of $414 million a year earlier. The carrier reported an annual loss of $8.9 billion, its biggest on record. Fundamentally, this is not something to be cheering about.
However, anything that Reddit investors have their sight on is worth putting on your watchlist. No, I’m not saying this is the best investment in the stock market. But with this week’s vaccine news, the road to recovery for AAL stock may be a smoother one.
Read More
Are These Retail Stocks Worth Buying In February? 4 Names To Know
Looking For The Top Tech Stocks To Watch Next Week? 4 Names In Focus
Carnival Corporation
Like American Airlines, the coronavirus pandemic has also brought the cruise-line business to a screeching halt. During the ongoing pandemic, the company has been burning hundreds of millions a month to stay operational. Even though the outlook for the industry seems bleak, many countries are immunizing their citizens. And that is a sign of hope.
Admittedly, it is still early to say if Carnival could allow all their ships to resume operation this year. But even if they don’t, the company has enough liquidity to weather through the COVID-19 storm.
That said, it is only a matter of time before the company could rebound. If things improve quickly in the coming few months, then there’s a good chance the company could rebound strongly. With another vaccine underway to immunize more citizens, things could really turn around for CCL stock sooner than we have expected.
[Read More] Apple (AAPL) Vs Microsoft (MSFT): Which Is A Better Tech Stock To Buy Right Now?
Booking Holdings
Similar to other travel stocks listed above, Booking has been hit hard by the global pandemic. After shedding more than 40% of its stock price during the March sell-off, the stock has recouped back all its pandemic losses. The company’s stock price had another boost recently when an analyst from Wells Fargo lifted his price target to $2,250 on Booking. This implies a 10% potential upside from Thursday’s closing.
Booking Holding is slated to report its fourth-quarter earnings in February, and it’s like to be another painful quarter. That’s because most of its businesses come from Europe. Many of these countries are still struggling to tame the insidious virus. While businesses are unlikely to pick up in Europe anytime soon, it’s interesting to know how other countries, particularly those in East Asia and Australia are faring.
Now, no one can be sure when the company could fully rebound in terms of its bookings. But with increasing vaccine distribution, more government stimulus, and the gradual reopening of the economy, there are reasons to be cheerful. With that in mind, will you be watching BKNG stock?
[Read More] General Electric vs 3M: Which Is A Better Industrial Stock To Buy?
AMC Entertainment
It’s hard to put a list of top stocks to buy without including AMC Entertainment in thestock market today The company has been in the limelight as of late for numerous reasons. Initially, investors were cheering on the company after it had gotten fresh funding to keep the company afloat. With bankruptcy no longer an imminent issue and with its balance sheet bolstered, the company believes that it has enough liquidity to keep its operation running until “deep into 2021”. That fresh funding has certainly assuaged fears that the company would go under.
The cinema operator has seen its stock price swinging wildly along with GameStop (NYSE: GME). After seeing its price drop below $2 per share earlier this month, AMC skyrocketed more than 1,000% to above $20 per share before shedding half of its value on Thursday’s trading. The good thing for AMC is that debtholders holding $600 million of AMC debt are converting the debt into AMC stock. That instantly improved the company’s financial position.
Despite yesterday’s plunge, AMC stock remains a darling to Reddit investors. While the plunge in stock price is due to the restriction imposed by Robinhood, there’s a great chance these Reddit investors will bid up AMC stock with another online brokerage firm today or sometime next week. Till then, you might want to add AMC stock to your watchlist to find out if it’s worth the risks.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Top Epicenter Stocks To Watch On February 2021 American Airlines (NASDAQ: AAL) Carnival Corporation (NYSE: CCL) Booking Holdings (NASDAQ: BKNG) AMC Entertainment Holdings (NYSE: AMC) American Airlines First up, shares of American Airlines soared more than 20% at the opening after the company reported earnings Thursday morning. If you haven’t taken a look at it closely, you would have thought AAL reported better than expected earnings. But the truth is, it’s because Reddit investors believe that AAL stock may be the next GameStop.
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Top Epicenter Stocks To Watch On February 2021 American Airlines (NASDAQ: AAL) Carnival Corporation (NYSE: CCL) Booking Holdings (NASDAQ: BKNG) AMC Entertainment Holdings (NYSE: AMC) American Airlines First up, shares of American Airlines soared more than 20% at the opening after the company reported earnings Thursday morning. If you haven’t taken a look at it closely, you would have thought AAL reported better than expected earnings. But the truth is, it’s because Reddit investors believe that AAL stock may be the next GameStop.
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Top Epicenter Stocks To Watch On February 2021 American Airlines (NASDAQ: AAL) Carnival Corporation (NYSE: CCL) Booking Holdings (NASDAQ: BKNG) AMC Entertainment Holdings (NYSE: AMC) American Airlines First up, shares of American Airlines soared more than 20% at the opening after the company reported earnings Thursday morning. If you haven’t taken a look at it closely, you would have thought AAL reported better than expected earnings. But the truth is, it’s because Reddit investors believe that AAL stock may be the next GameStop.
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Top Epicenter Stocks To Watch On February 2021 American Airlines (NASDAQ: AAL) Carnival Corporation (NYSE: CCL) Booking Holdings (NASDAQ: BKNG) AMC Entertainment Holdings (NYSE: AMC) American Airlines First up, shares of American Airlines soared more than 20% at the opening after the company reported earnings Thursday morning. If you haven’t taken a look at it closely, you would have thought AAL reported better than expected earnings. But the truth is, it’s because Reddit investors believe that AAL stock may be the next GameStop.
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4747.0
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2021-01-29 00:00:00 UTC
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Wall St Week Ahead-Sideshow or main event? GameStop stock ride weighed as bubble warning
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AAL
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https://www.nasdaq.com/articles/wall-st-week-ahead-sideshow-or-main-event-gamestop-stock-ride-weighed-as-bubble-warning
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By Lewis Krauskopf
NEW YORK, Jan 29 (Reuters) - Some investors are growing concerned that wild swings in GameStop GME.N and other stocks driven by small-time traders could be fresh signs of overexuberance that foreshadow volatility for the broader stock market.
GameStop shares closed up 400% for the week after the video game chain's stock became a battleground between retail traders and Wall Street professionals, a tussle that captivated investors the world over.
Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year.
Fed Chairman Jerome Powell earlier this week pushed back on suggestions that the central bank's super-low interest rates and massive bond purchases were creating asset bubbles.
But those comments failed to quell some investors' worries that the Fed's monetary policy has encouraged excessive risk-taking across broader markets: The S&P 500 .SPX is up 66% since March and stocks stand near their highest valuations in two decades.
The action in GameStop and other stocks “definitely gives us some cause for concern," said James Ragan, director of wealth management research at D.A. Davidson. "At the very least, you have to consider that there's a chance of a market correction."
The moves also drew some comparisons to the internet stock mania two decades earlier.
"Just the fact that you have a group of investors that are really chasing abnormal gains, that’s what is reminiscent of the dot-com bubble,” Ragan said.
Some barometers of general over-exuberance are already flashing: Citi said its “Panic/Euphoria” model is in "elevated euphoric territory." And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets.
The frenzied trading dominated the news on Wall Street this week, even as Apple Inc AAPL.O, Microsoft Corp MSFT.O and other corporate heavyweights reported quarterly results. The S&P 500 fell 3.3% for the week, with trading volume surging above 24 billion shares on Wednesday, well above the 14.4 billion-share average of the past 20 sessions. The CBOE volatility index .VIX closed above 30 points this week for the first time since early November.
One potential catalyst for further volatility could come if hedge funds are forced to sell out of positions in order to cover failed short selling bets, although it was unclear whether there would be enough of such selling to create a broad risk to equities.
Already, some short-selling hedge funds appeared to be changing their approach. Short seller Andrew Left, whose company Citron Research was one of the hedge funds to spark this week’s battle with small-time traders over GameStop Corp, said in a YouTube video on Friday that his company would no longer publish short selling research.
Others said the ramped-up activity of retail investors - who last year helped drive rallies in shares of Tesla Inc TSLA.O and other names - could in itself be the latest sign of market frothiness.
“When you think about market bubbles, the last players that jump on board are retail, and that is generally what is happening right now,” said Mike Mullaney, director of global markets research at Boston Partners.
Analysts at LPL Financial doubt the recent ructions in GameStop and other names indicate a broader market bubble, noting that market breadth - which measures how many stocks are participating in a rally - remains healthy and credit markets are functioning "just fine."
"Maybe it is simply time for a break" in the S&P 500's rally, the firm said in a report Friday.
Others, though, pointed to potential market turbulence ahead.
Stephen Suttmeier, technical research strategist at BofA Global Research, earlier this week urged clients to "take some profits" ahead of February, a comparatively weak month for stocks.
Other worrisome signs are the explosion of special purpose acquisition companies, or SPACs, and the surge in shares of electric vehicle companies on the heels of Tesla's gains, said Scott Schermerhorn, chief investment officer at Granite Investment Advisors.
Still, he believes the frenzy over GameStop and other stocks is more of a "sideshow."
Even after their rallies, the market capitalization of GameStop and other companies that have recently seen their stocks soar are "like a rounding error" compared with the broader market, he said.
(Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Jonathan Oatis)
((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters Messaging: lewis.krauskopf.thomsonreuters.com@reuters.net, Twitter: @LKrauskopf))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. Fed Chairman Jerome Powell earlier this week pushed back on suggestions that the central bank's super-low interest rates and massive bond purchases were creating asset bubbles. But those comments failed to quell some investors' worries that the Fed's monetary policy has encouraged excessive risk-taking across broader markets: The S&P 500 .SPX is up 66% since March and stocks stand near their highest valuations in two decades.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets. Analysts at LPL Financial doubt the recent ructions in GameStop and other names indicate a broader market bubble, noting that market breadth - which measures how many stocks are participating in a rally - remains healthy and credit markets are functioning "just fine."
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. By Lewis Krauskopf NEW YORK, Jan 29 (Reuters) - Some investors are growing concerned that wild swings in GameStop GME.N and other stocks driven by small-time traders could be fresh signs of overexuberance that foreshadow volatility for the broader stock market. Short seller Andrew Left, whose company Citron Research was one of the hedge funds to spark this week’s battle with small-time traders over GameStop Corp, said in a YouTube video on Friday that his company would no longer publish short selling research.
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Some market-watchers see those massive gains, as well as the moves in American Airlines AAL.O and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year. GameStop shares closed up 400% for the week after the video game chain's stock became a battleground between retail traders and Wall Street professionals, a tussle that captivated investors the world over. And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets.
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4748.0
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2021-01-29 00:00:00 UTC
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Why Airline Shares Fell Today
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AAL
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https://www.nasdaq.com/articles/why-airline-shares-fell-today-2021-01-29
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nan
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nan
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What happened
Friday was a gloomy day on Wall Street, with the S&P 500 index falling nearly 2%. Airline shares underperformed the indexes, with United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Delta Air Lines (NYSE: DAL), and Hawaiian Holdings (NASDAQ: HA) all closing down more than 5%.
So what
Airline stocks took it on the chin in 2020, with the pandemic causing travel demand to evaporate and pushing the entire industry into the red. As we said yesterday, fourth-quarter earnings have come in largely as dismal as expected, and investors right now are more focused on trying to figure out how soon a recovery might take hold.
Most of the news on Friday was negative. In a memo to employees obtained by Reuters, United said it could furlough up to 14,000 employees when government payroll support expires on April 1, saying that "despite ongoing efforts to distribute vaccines, customer demand has not changed much."
Image source: Getty Images.
The industry won a reprieve from layoffs and furloughs in December when Congress approved a new $15 billion payroll support package, but absent a rebound in revenue, the industry cannot afford to maintain pre-pandemic staffing levels.
American, meanwhile, filed to take advantage of a recent run-up in its stock price that appears influenced by factors not specific to the company. The airline said in a regulatory filing it intends to sell as much as $1.1 billion in stock in an at-the-market offering, with proceeds set to bolster its liquidity position and for other corporate purposes.
Hawaiian's Friday fall follows a jump on Thursday, leaving the stock nearly unchanged over the two days. The airline has done what it can to weather the crisis, but with international flights expected to rebound last and its home state at times imposing harsh quarantine restrictions on visitors, there is only so much the airline can do to bounce back for now.
Delta had no company-specific news on Friday, but after opening earnings season on a high note last week, the stock has been steadily drawn down as investors digest how long a recovery will take.
Now what
The news from both American and United, while not ideal, shouldn't actually be bad for long-term holders. More shares mean dilution, and often put pressure on a stock, and furloughs are never to be celebrated. But both actions are a reminder these companies are doing what they must to survive, and should indeed be able to get through the crisis without bankruptcy.
The question, as always, is how long investors have to wait to see the upside. Part of the weakness in the shares is that while the vaccine has given us reason to start looking for an answer to that question, we are no closer to knowing for sure than we were back in November.
With any luck, we'll start seeing signs of a recovery in the months to come, as more people are vaccinated and tourists begin to make summer vacation plans. But given the uncertainty, investors would be wise to stick to top operators like Delta and Southwest Airlines and not to speculate too much on a recovery.
10 stocks we like better than Delta Air Lines
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Lou Whiteman owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines, Hawaiian Holdings, and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Airline shares underperformed the indexes, with United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Delta Air Lines (NYSE: DAL), and Hawaiian Holdings (NASDAQ: HA) all closing down more than 5%. The airline said in a regulatory filing it intends to sell as much as $1.1 billion in stock in an at-the-market offering, with proceeds set to bolster its liquidity position and for other corporate purposes. Delta had no company-specific news on Friday, but after opening earnings season on a high note last week, the stock has been steadily drawn down as investors digest how long a recovery will take.
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Airline shares underperformed the indexes, with United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Delta Air Lines (NYSE: DAL), and Hawaiian Holdings (NASDAQ: HA) all closing down more than 5%. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines, Hawaiian Holdings, and Southwest Airlines.
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Airline shares underperformed the indexes, with United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Delta Air Lines (NYSE: DAL), and Hawaiian Holdings (NASDAQ: HA) all closing down more than 5%. 10 stocks we like better than Delta Air Lines When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines.
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Airline shares underperformed the indexes, with United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Delta Air Lines (NYSE: DAL), and Hawaiian Holdings (NASDAQ: HA) all closing down more than 5%. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Delta Air Lines wasn't one of them! See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines.
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4749.0
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2021-01-29 00:00:00 UTC
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American Airlines launches another $1 bln equity offering, details jet financing
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AAL
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https://www.nasdaq.com/articles/american-airlines-launches-another-%241-bln-equity-offering-details-jet-financing-2021-01-29
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Adds details on aircraft financing
Jan 29 (Reuters) - American Airlines AAL.O has authorized another $1 billion stock sale, following an ongoing $1 billion offering launched in October to boost liquidity, the company said in a regulatory filing on Friday that also detailed its aircraft financing commitments.
Only three of 16 Boeing 737 MAX orders scheduled for delivery through next year have committed financing, and American has the right to defer delivery of the remaining 13 until 2023 or 2024, it said.
Previous financing for some of the 737 MAX planes that American was meant to receive in 2020 had expired as Boeing Co BA.N froze deliveries during a 20-month safety ban that finally ended in the United States in November.
American said financing was in place for the 19 Boeing 787 aircraft and 15 Airbus AIR.PA NEOs to be delivered this year, but not for any of the 26 NEO aircraft deliveries scheduled for 2022.
Bankers say aircraft financing is broadly available for mainline aircraft that provide solid dollar-denominated returns, but any tightening of availability could affect deliveries.
Wrestling with a historic slump in air travel due to the coronavirus pandemic, many airlines have deferred or even canceled airplane orders and rushed to raise liquidity to ride out the crisis.
American's new stock offering follows a stock surge on Thursday after the carrier was mentioned on Reddit's WallStreetBets forum. On Friday the stock was 2.3% lower at $17.68.
From the October equity offering, it has raised $882 million so far at an average share price of $12.87.
Separately, American said it did not expect a material impact from the cancellation of some 300 flights operated by its wholly owned regional subsidiary PSA on Thursday following maintenance issues. Most of the aircraft have been returned to service or will be shortly, it said.
U.S. lifts Boeing 737 MAX flight ban after crash probes, tough hurdles remain
(Reporting by Tracy Rucinski; Editing by Jan Harvey and Richard Chang)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Adds details on aircraft financing Jan 29 (Reuters) - American Airlines AAL.O has authorized another $1 billion stock sale, following an ongoing $1 billion offering launched in October to boost liquidity, the company said in a regulatory filing on Friday that also detailed its aircraft financing commitments. Previous financing for some of the 737 MAX planes that American was meant to receive in 2020 had expired as Boeing Co BA.N froze deliveries during a 20-month safety ban that finally ended in the United States in November. Wrestling with a historic slump in air travel due to the coronavirus pandemic, many airlines have deferred or even canceled airplane orders and rushed to raise liquidity to ride out the crisis.
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Adds details on aircraft financing Jan 29 (Reuters) - American Airlines AAL.O has authorized another $1 billion stock sale, following an ongoing $1 billion offering launched in October to boost liquidity, the company said in a regulatory filing on Friday that also detailed its aircraft financing commitments. Only three of 16 Boeing 737 MAX orders scheduled for delivery through next year have committed financing, and American has the right to defer delivery of the remaining 13 until 2023 or 2024, it said. American said financing was in place for the 19 Boeing 787 aircraft and 15 Airbus AIR.PA NEOs to be delivered this year, but not for any of the 26 NEO aircraft deliveries scheduled for 2022.
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Adds details on aircraft financing Jan 29 (Reuters) - American Airlines AAL.O has authorized another $1 billion stock sale, following an ongoing $1 billion offering launched in October to boost liquidity, the company said in a regulatory filing on Friday that also detailed its aircraft financing commitments. Only three of 16 Boeing 737 MAX orders scheduled for delivery through next year have committed financing, and American has the right to defer delivery of the remaining 13 until 2023 or 2024, it said. American said financing was in place for the 19 Boeing 787 aircraft and 15 Airbus AIR.PA NEOs to be delivered this year, but not for any of the 26 NEO aircraft deliveries scheduled for 2022.
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Adds details on aircraft financing Jan 29 (Reuters) - American Airlines AAL.O has authorized another $1 billion stock sale, following an ongoing $1 billion offering launched in October to boost liquidity, the company said in a regulatory filing on Friday that also detailed its aircraft financing commitments. Only three of 16 Boeing 737 MAX orders scheduled for delivery through next year have committed financing, and American has the right to defer delivery of the remaining 13 until 2023 or 2024, it said. Bankers say aircraft financing is broadly available for mainline aircraft that provide solid dollar-denominated returns, but any tightening of availability could affect deliveries.
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4750.0
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2021-01-29 00:00:00 UTC
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United Airlines warns 14,000 jobs at risk when payroll aid expires
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AAL
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https://www.nasdaq.com/articles/united-airlines-warns-14000-jobs-at-risk-when-payroll-aid-expires-2021-01-29
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By Tracy Rucinski and David Shepardson
CHICAGO, Jan 29 (Reuters) - United Airlines UAL.O said on Friday it has sent warnings of potential furloughs to some 14,000 employees whose jobs are at risk once a second round of payroll support for airlines expires on April 1, as demand for air travel has been hard hit by the coronavirus pandemic.
Chicago-based United had recalled 13,000 employees from furlough when the fresh payroll package was passed in December.
"Despite ongoing efforts to distribute vaccines, customer demand has not changed much since we recalled those employees. today," United told employees, while saying it was monitoring demand and advocating for continued government support.
Congress approved $15 billion in new payroll assistance in December to help keep more than 32,000 airline workers on payrolls through March 31, after awarding $25 billion in March for passenger airlines in payroll assistance and $25 billion in low-cost government loans.
American Airlines AAL.O, which had furloughed 19,000 workers in October, did not immediately comment on Friday on whether it would issue new notices of potential layoffs.
On Thursday, Sara Nelson, president of the Association of Flight Attendants-CWA (AFA), representing workers at 17 airlines, urged Congress to extend a passenger airline payroll assistance program for a third time.
United's Friday memo said "we’re continuing to monitor demand and advocate for continued government support, and we are all working hard toward the day when we can bring back our furloughed co-workers permanently."
American Airlines chief executive Doug Parker said on Thursday that "April 1 is approaching and demand hasn’t gotten much better... So we are definitely going to need to address this, unless demand starts to pick up."
Parker said the company’s unions "are already talking to the administration in Congress about this... We would obviously be supportive of that."
(Reporting by Tracy Rucinski in Chicago and David Shepardson in Washington, Editing by Franklin Paul and Bill Berkrot)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL.O, which had furloughed 19,000 workers in October, did not immediately comment on Friday on whether it would issue new notices of potential layoffs. By Tracy Rucinski and David Shepardson CHICAGO, Jan 29 (Reuters) - United Airlines UAL.O said on Friday it has sent warnings of potential furloughs to some 14,000 employees whose jobs are at risk once a second round of payroll support for airlines expires on April 1, as demand for air travel has been hard hit by the coronavirus pandemic. American Airlines chief executive Doug Parker said on Thursday that "April 1 is approaching and demand hasn’t gotten much better...
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American Airlines AAL.O, which had furloughed 19,000 workers in October, did not immediately comment on Friday on whether it would issue new notices of potential layoffs. By Tracy Rucinski and David Shepardson CHICAGO, Jan 29 (Reuters) - United Airlines UAL.O said on Friday it has sent warnings of potential furloughs to some 14,000 employees whose jobs are at risk once a second round of payroll support for airlines expires on April 1, as demand for air travel has been hard hit by the coronavirus pandemic. Congress approved $15 billion in new payroll assistance in December to help keep more than 32,000 airline workers on payrolls through March 31, after awarding $25 billion in March for passenger airlines in payroll assistance and $25 billion in low-cost government loans.
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American Airlines AAL.O, which had furloughed 19,000 workers in October, did not immediately comment on Friday on whether it would issue new notices of potential layoffs. By Tracy Rucinski and David Shepardson CHICAGO, Jan 29 (Reuters) - United Airlines UAL.O said on Friday it has sent warnings of potential furloughs to some 14,000 employees whose jobs are at risk once a second round of payroll support for airlines expires on April 1, as demand for air travel has been hard hit by the coronavirus pandemic. Congress approved $15 billion in new payroll assistance in December to help keep more than 32,000 airline workers on payrolls through March 31, after awarding $25 billion in March for passenger airlines in payroll assistance and $25 billion in low-cost government loans.
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American Airlines AAL.O, which had furloughed 19,000 workers in October, did not immediately comment on Friday on whether it would issue new notices of potential layoffs. By Tracy Rucinski and David Shepardson CHICAGO, Jan 29 (Reuters) - United Airlines UAL.O said on Friday it has sent warnings of potential furloughs to some 14,000 employees whose jobs are at risk once a second round of payroll support for airlines expires on April 1, as demand for air travel has been hard hit by the coronavirus pandemic. Chicago-based United had recalled 13,000 employees from furlough when the fresh payroll package was passed in December.
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4751.0
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2021-01-29 00:00:00 UTC
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Botswana's Debswana diamond exports fell 30% in 2020
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AAL
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https://www.nasdaq.com/articles/botswanas-debswana-diamond-exports-fell-30-in-2020-2021-01-29
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nan
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GABORONE, Jan 29 (Reuters) - Exports of rough diamonds mined by the Debswana Diamond Company fell 30% in 2020, statistics released by the Bank of Botswana showed Friday, as the coronavirus pandemic hit demand and global travel restrictions impacted trading.
Debswana, a joint venture between Anglo American AAL.L unit De Beers and the Botswana government, produces almost all of the southern African nation's diamonds. Lucara’s Karowe mine is the only other operating diamond mine in the country.
According to the central bank data, diamond exports from Debswana fell to $2.02 billion in 2020 from $3.05 billion in 2019. Quarterly drops of 63% and 66% were recorded in the second and third quarters respectively.
Sales picked up in the fourth quarter, when exports climbed 35% compared to the same period in 2019.
In a bid to curb the spread of the virus, Botswana closed its borders for eight months last year, locking out international buyers from centres such as Mumbai, Antwerp and China, who traditionally travel to capital Gaborone ten times a year to view and buy diamonds from De Beers.
Botswana gets about 30% of its revenues from diamond sales, via its partnership with De Beers.
The government forecasts the pandemic will see the economy shrink by 8.9% in 2020, while the budget deficit will more than double. The economy is seen rebounding to growth of 7.7% in 2021 after the country reopened its borders in December.
Botswana has so far recorded more than 19,000 COVID-19 cases, with 134 deaths.
(Reporting by Brian Benza; Editing by Mfuneko Toyana and Jan Harvey)
((mfuneko.toyana@thomsonreuters.com; +27117753153; Reuters Messaging: mfuneko.toyana.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Debswana, a joint venture between Anglo American AAL.L unit De Beers and the Botswana government, produces almost all of the southern African nation's diamonds. GABORONE, Jan 29 (Reuters) - Exports of rough diamonds mined by the Debswana Diamond Company fell 30% in 2020, statistics released by the Bank of Botswana showed Friday, as the coronavirus pandemic hit demand and global travel restrictions impacted trading. In a bid to curb the spread of the virus, Botswana closed its borders for eight months last year, locking out international buyers from centres such as Mumbai, Antwerp and China, who traditionally travel to capital Gaborone ten times a year to view and buy diamonds from De Beers.
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Debswana, a joint venture between Anglo American AAL.L unit De Beers and the Botswana government, produces almost all of the southern African nation's diamonds. GABORONE, Jan 29 (Reuters) - Exports of rough diamonds mined by the Debswana Diamond Company fell 30% in 2020, statistics released by the Bank of Botswana showed Friday, as the coronavirus pandemic hit demand and global travel restrictions impacted trading. According to the central bank data, diamond exports from Debswana fell to $2.02 billion in 2020 from $3.05 billion in 2019.
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Debswana, a joint venture between Anglo American AAL.L unit De Beers and the Botswana government, produces almost all of the southern African nation's diamonds. GABORONE, Jan 29 (Reuters) - Exports of rough diamonds mined by the Debswana Diamond Company fell 30% in 2020, statistics released by the Bank of Botswana showed Friday, as the coronavirus pandemic hit demand and global travel restrictions impacted trading. In a bid to curb the spread of the virus, Botswana closed its borders for eight months last year, locking out international buyers from centres such as Mumbai, Antwerp and China, who traditionally travel to capital Gaborone ten times a year to view and buy diamonds from De Beers.
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Debswana, a joint venture between Anglo American AAL.L unit De Beers and the Botswana government, produces almost all of the southern African nation's diamonds. GABORONE, Jan 29 (Reuters) - Exports of rough diamonds mined by the Debswana Diamond Company fell 30% in 2020, statistics released by the Bank of Botswana showed Friday, as the coronavirus pandemic hit demand and global travel restrictions impacted trading. Lucara’s Karowe mine is the only other operating diamond mine in the country.
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4752.0
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2021-01-29 00:00:00 UTC
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Traders return to GameStop plays as brokerages ease restrictions
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https://www.nasdaq.com/articles/traders-return-to-gamestop-plays-as-brokerages-ease-restrictions-2021-01-29
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By Sagarika Jaisinghani and Medha Singh
Jan 29 (Reuters) - Wall Street braced on Friday for the return of an army of amateur investors to trading in GameStop and other hot stocks whose surges this week and subsequent suspension have pitched the little guy against short-selling hedge funds.
Shares in GameStop GME.N, AMC Entertainment AMC.N and BlackBerry BB.N plunged more than 40% on Thursday after several online platforms imposed buying halts, but rebounded in late trading as Robinhood and Interactive Brokers said they planned to ease the restrictions on Friday.
The showdown between individual investors and professional short-sellers has roiled global equity markets as funds were forced to sell some of their best-performing stocks, including Apple Inc AAPL.O, to cover billions of dollars of losses.
Wall Street futures EScv1, NQcv1 and European stock markets .STOXX fell 1% on Friday, while Asian equities headed for their steepest weekly loss in months as the GameStop effect added to growing doubts about the future of a decade-long rally. MKTS/GLOB
Shares in GameStop surged as much as 100% before the formal open of premarket trading in New York.
"My expectation is that this will blow over and then the Robinhood crowd will look for a different target, but typically these things come in waves," said Andrea Cicione, head of strategy at TS Lombard in London.
Investors, celebrities and policymakers denounced Thursday's restrictions, with two customers suing Robinhood over the trading ban and Capital Hill committees signalling they would hold hearings on the affair.
On Reddit forum WallStreetBets, which with almost 6 million members is seen as having fuelled the rallies, GameStop and AMC remained overwhelmingly favored stocks.
J.P. Morgan has named 45 stocks that may be susceptible to "fragility events" in days to come, including real estate company Macerich Co MAC.N, restaurant chain Cheesecake Factory Inc CAKE.O and clothing subscription service Stitch Fix Inc SFIX.O.
Like GameStop, AMC and American Airlines Group Inc AAL.O, all have high "short" interest ratios, making them subject to a squeeze on funds that have bet on the shares falling.
"Unfortunately, it's definitely not a one-off thing," said Randy Frederick, vice president of trading and derivatives at the Schwab Center for Financial Research.
"The type of activity that drove that (move) higher, I believe, has caused people to try to duplicate that in other names."
STEAL FROM THE RICH?
Online broker Robinhood has been one of the hottest venues in the retail-trading frenzy but its sudden curbs on buying set off a raft of online protests as the firm tapped credit lines to ensure it could continue trading.
A report in the New York Times overnight said the brokerage was raising an infusion of more than $1 billion from its existing investors, having been strained by the high volumes and volatility of trading this week.
Robinhood did not immediately respond to a request for comment, but said in a blog post earlier that volatility affected its obligations to hold capital and clearinghouse deposits, adding there was no liquidity crisis.
Regarded by market professionals as "dumb money", the pack of retail traders - some of them former bankers working for themselves - has become an increasingly powerful force of the financial world, sparking calls for greater scrutiny into trading on easy access online apps fueled by anonymous discussions on social media.
After Thursday's moves, those who are involved in the trades now face the dilemma of closing out positions in the red with losses, selling to cash in winnings or pushing on to force more short-sellers to capitulate.
"Now we're really figuring out what can happen when something doesn't go their way," said JJ Buckner, a 29-year old Robinhood trader whose YouTube live-stream got over 250,000 hits earlier this week.
EXPLAINER-Why regulators may scrutinize GameStop's Reddit-driven retail stock surge
TIMELINE-GameStop's 1,600% surge in retail investor vs hedge fund battle
BREAKINGVIEWS-Short squeezers could end up strangling themselves
The big short: GameStop effect puts global bets worth billions at risk
GameStop surge leaves U.S.-based mutual funds and ETFs behind
Europe's top shorted stocks soar on GameStop contagion
U.S. state regulator says GameStop trading could be 'systemically wrong' - Barron's
Bearish GameStop options contracts fly off the shelf after stock surge
Hedge fund Melvin Capital has closed GameStop position -spokesman
BlackRock may have raked in $2.4 bln on GameStop's retail-driven stock frenzy
QUOTES-No let up in short squeeze, retail frenzy forces funds to cover
GRAPHIC: GameStock surge timelinehttps://tmsnrt.rs/2KSQYX3
GRAPHIC: The short squeezehttps://tmsnrt.rs/3t1OlU8
EXPLAINER-How retail traders squeezed Wall Street for bets against GameStop
Retail trading frenzy, reflation trade drive smallcap stocks higherhttps://tmsnrt.rs/2Ylef7l
GRAPHIC-U.S. most shorted index soars as wider market coolshttps://tmsnrt.rs/36mHWcx
GRAPHIC-Hedge funds scrambling to exit shorts, cut losseshttps://tmsnrt.rs/2M3Ke9D
GRAPHIC-GameStop 'long the shorts' trade goes mainstream
FACTBOX-A peek into stocks swept up in GameStop retail trading frenzy
TAKE A LOOK-From Reddit rally to trade curbs: The retail trading frenzy
(Reporting by Sagarika Jaisinghani and Medha Singh in Bengaluru; Additional reporting by Munsif Vengattil and Juby Babu in Bengaluru, Anna Irrera, Saqib Iqbal Ahmed and April Joyner in New York and Thyagaraju Adinarayan in London; Writing by Patrick Graham; Editing by Saumyadeb Chakrabarty)
((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Like GameStop, AMC and American Airlines Group Inc AAL.O, all have high "short" interest ratios, making them subject to a squeeze on funds that have bet on the shares falling. By Sagarika Jaisinghani and Medha Singh Jan 29 (Reuters) - Wall Street braced on Friday for the return of an army of amateur investors to trading in GameStop and other hot stocks whose surges this week and subsequent suspension have pitched the little guy against short-selling hedge funds. Shares in GameStop GME.N, AMC Entertainment AMC.N and BlackBerry BB.N plunged more than 40% on Thursday after several online platforms imposed buying halts, but rebounded in late trading as Robinhood and Interactive Brokers said they planned to ease the restrictions on Friday.
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Like GameStop, AMC and American Airlines Group Inc AAL.O, all have high "short" interest ratios, making them subject to a squeeze on funds that have bet on the shares falling. The showdown between individual investors and professional short-sellers has roiled global equity markets as funds were forced to sell some of their best-performing stocks, including Apple Inc AAPL.O, to cover billions of dollars of losses. Wall Street futures EScv1, NQcv1 and European stock markets .STOXX fell 1% on Friday, while Asian equities headed for their steepest weekly loss in months as the GameStop effect added to growing doubts about the future of a decade-long rally.
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Like GameStop, AMC and American Airlines Group Inc AAL.O, all have high "short" interest ratios, making them subject to a squeeze on funds that have bet on the shares falling. By Sagarika Jaisinghani and Medha Singh Jan 29 (Reuters) - Wall Street braced on Friday for the return of an army of amateur investors to trading in GameStop and other hot stocks whose surges this week and subsequent suspension have pitched the little guy against short-selling hedge funds. Shares in GameStop GME.N, AMC Entertainment AMC.N and BlackBerry BB.N plunged more than 40% on Thursday after several online platforms imposed buying halts, but rebounded in late trading as Robinhood and Interactive Brokers said they planned to ease the restrictions on Friday.
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Like GameStop, AMC and American Airlines Group Inc AAL.O, all have high "short" interest ratios, making them subject to a squeeze on funds that have bet on the shares falling. Shares in GameStop GME.N, AMC Entertainment AMC.N and BlackBerry BB.N plunged more than 40% on Thursday after several online platforms imposed buying halts, but rebounded in late trading as Robinhood and Interactive Brokers said they planned to ease the restrictions on Friday. The showdown between individual investors and professional short-sellers has roiled global equity markets as funds were forced to sell some of their best-performing stocks, including Apple Inc AAPL.O, to cover billions of dollars of losses.
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4753.0
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2021-01-29 00:00:00 UTC
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Robinhood is new eye of GameStop storm as outrage grows
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https://www.nasdaq.com/articles/robinhood-is-new-eye-of-gamestop-storm-as-outrage-grows-2021-01-29
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By Anna Irrera and Tom Westbrook
LONDON/SINGAPORE Jan 29 (Reuters) - Online broker Robinhood has been one of the hottest venues in this week's retail-trading frenzy but its sudden curbs on buying of some hot stocks have raised the ire of customers, celebrities and politicians who argue it unfairly benefits bigger investors.
The firm has also tapped a credit line so that it has funds to ensure trading continuity when it lifts the rules.
Robinhood Chief Executive Vlad Tenev said on Thursday trade was restricted in "about 13" viral stocks, which include GameStop GME.N, AMC Entertainment AMC.N and American Airlines AAL.O, to protect the company and its customers from volatility.
Those stocks slid on Thursday, paring losses only after Robinhood said it hoped to lift the curbs on Friday.
Tenev said on CNBC the brokerage had tapped credit lines "so that we could maximise, within reason, the funds we have to deposit at the clearing houses," to facilitate more trade.
"We understand our customers are upset, we're doing what we can to re-enable buying in these names," he said. "We want to be clear in the communications, and I own that we should have been out there a little bit sooner."
While other firms such as Interactive Brokers also restricted trading, Robinhood's fee-free and simple-to-use app has made it popular with a new generation of small-time traders and its restrictions drew the heaviest backlash.
"Robinhood? Nah y'all ROBBING the HOOD," tweeted one user. "Crazy how you guys would rather watch your company burn to the ground than live up to your promise to provide users with free trade," commented another.
Twitter users also complained that Robinhood appeared to be selling their shares without authorization. Robinhood did not immediately comment on whether it had restricted sales, however Tenev said customers were allowed to sell, but not buy.
Two customers sued Robinhood Financial, seeking damages trading halts in a series of stocks.
Bloomberg reported the broker has tapped at least several hundred million dollars from its lenders, including JP Morgan and Goldman Sachs, though Tenev did not discuss the size of Robinhood's borrowing on CNBC.
Meanwhile, anger has spread beyond the investment community with rappers and U.S. politicians on both sides of the aisle joining the backlash.
"This is unacceptable," tweeted Representative Alexandria Ocasio-Cortez, a Democrat.
"We now need to know more about @RobinhoodApp's decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit."
Her tweet was shared by Republican Senator Ted Cruz who commented "fully agree." Tesla founder Elon Musk, whose shares have also been a retail favorite, also commented on Ocasio-Cortez's tweet saying "Absolutely".
Robinhood did not respond to requests for comment.
Celebrities also chimed in. "Yo this is a fucking CRIME what @RobinhoodApp is doing DO NOT SELL!!!", tweeted rapper Ja Rule.
Founded in 2013 with the mission of "democratizing finance for all" by offering commission-free trading, Thursday's move was seen by many as hypocritical. Many users shared a tweet from 2016 in which the company said "Let the people trade."
"This was always a potential issue with Robinhood," said Ian Kar, co-founder and chief executive of research provider Fintech Today. "When are you responsible for helping your users make good financial decisions, versus allowing them to trade freely?"
Robinhood has seen business boom during the coronavirus pandemic as more homebound consumers took to buying and selling stocks online. The app now counts more than 13 million users.
While its engaging service has made it appealing to millions of customers, it has also drawn the scrutiny of critics and regulators who are concerned the company may be encouraging risky behavior in retail investors.
(Reporting by Anna Irrera in London and Tom Westbrook in Singapore; additional reporting by Noor Zainab Hussain; editing by Megan Davies, Grant McCool and Sam Holmes)
((tom.westbrook@tr.com; +65 6318 4876;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Robinhood Chief Executive Vlad Tenev said on Thursday trade was restricted in "about 13" viral stocks, which include GameStop GME.N, AMC Entertainment AMC.N and American Airlines AAL.O, to protect the company and its customers from volatility. By Anna Irrera and Tom Westbrook LONDON/SINGAPORE Jan 29 (Reuters) - Online broker Robinhood has been one of the hottest venues in this week's retail-trading frenzy but its sudden curbs on buying of some hot stocks have raised the ire of customers, celebrities and politicians who argue it unfairly benefits bigger investors. Bloomberg reported the broker has tapped at least several hundred million dollars from its lenders, including JP Morgan and Goldman Sachs, though Tenev did not discuss the size of Robinhood's borrowing on CNBC.
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Robinhood Chief Executive Vlad Tenev said on Thursday trade was restricted in "about 13" viral stocks, which include GameStop GME.N, AMC Entertainment AMC.N and American Airlines AAL.O, to protect the company and its customers from volatility. By Anna Irrera and Tom Westbrook LONDON/SINGAPORE Jan 29 (Reuters) - Online broker Robinhood has been one of the hottest venues in this week's retail-trading frenzy but its sudden curbs on buying of some hot stocks have raised the ire of customers, celebrities and politicians who argue it unfairly benefits bigger investors. "We now need to know more about @RobinhoodApp's decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit."
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Robinhood Chief Executive Vlad Tenev said on Thursday trade was restricted in "about 13" viral stocks, which include GameStop GME.N, AMC Entertainment AMC.N and American Airlines AAL.O, to protect the company and its customers from volatility. By Anna Irrera and Tom Westbrook LONDON/SINGAPORE Jan 29 (Reuters) - Online broker Robinhood has been one of the hottest venues in this week's retail-trading frenzy but its sudden curbs on buying of some hot stocks have raised the ire of customers, celebrities and politicians who argue it unfairly benefits bigger investors. Robinhood did not immediately comment on whether it had restricted sales, however Tenev said customers were allowed to sell, but not buy.
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Robinhood Chief Executive Vlad Tenev said on Thursday trade was restricted in "about 13" viral stocks, which include GameStop GME.N, AMC Entertainment AMC.N and American Airlines AAL.O, to protect the company and its customers from volatility. "Robinhood? Robinhood did not immediately comment on whether it had restricted sales, however Tenev said customers were allowed to sell, but not buy.
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4754.0
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2021-01-29 00:00:00 UTC
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American Airlines plans to sell another $1 billion in stock to boost liquidity
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https://www.nasdaq.com/articles/american-airlines-plans-to-sell-another-%241-billion-in-stock-to-boost-liquidity-2021-01-29
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Jan 29 (Reuters) - American Airlines AAL.O has authorized the sale of another $1 billion in stock, expanding upon a $1 billion offering announced last October to boost liquidity, the company said in a regulatory filing on Friday.
From the October offering, American said it has raised $882 million so far through the sale of common stock at an average price of $12.87 per share.
The new plan follows a stock surge on Thursday after the carrier was mentioned on Reddit's WallStreetBets forum. On Friday the stock was 1.7% lower at $17.76.
In the filing, American also detailed the terms of its aircraft financial commitments, saying it has secured the right to defer 13 of 16 Boeing 737 MAX aircraft deliveries scheduled for 2021 and 2022 if it does not have committed financing.
Previous financing for some of the aircraft that American was meant to receive in 2020 had expired as Boeing Co BA.N froze 737 MAX deliveries during a 20-month safety ban that finally ended in the United States in November.
American said it expects to receive six MAX aircraft in 2021 and 10 in 2022, but only has financing commitments for three of those jets. The others can be deferred until 2023 or 2024.
Bankers say aircraft finance is broadly available for mainline aircraft that provide solid dollar-denominated returns, but any tightening of availability could affect deliveries.
U.S. lifts Boeing 737 MAX flight ban after crash probes, tough hurdles remain
(Reporting by Tracy Rucinski; Editing by Jan Harvey)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Jan 29 (Reuters) - American Airlines AAL.O has authorized the sale of another $1 billion in stock, expanding upon a $1 billion offering announced last October to boost liquidity, the company said in a regulatory filing on Friday. From the October offering, American said it has raised $882 million so far through the sale of common stock at an average price of $12.87 per share. Previous financing for some of the aircraft that American was meant to receive in 2020 had expired as Boeing Co BA.N froze 737 MAX deliveries during a 20-month safety ban that finally ended in the United States in November.
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Jan 29 (Reuters) - American Airlines AAL.O has authorized the sale of another $1 billion in stock, expanding upon a $1 billion offering announced last October to boost liquidity, the company said in a regulatory filing on Friday. From the October offering, American said it has raised $882 million so far through the sale of common stock at an average price of $12.87 per share. In the filing, American also detailed the terms of its aircraft financial commitments, saying it has secured the right to defer 13 of 16 Boeing 737 MAX aircraft deliveries scheduled for 2021 and 2022 if it does not have committed financing.
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Jan 29 (Reuters) - American Airlines AAL.O has authorized the sale of another $1 billion in stock, expanding upon a $1 billion offering announced last October to boost liquidity, the company said in a regulatory filing on Friday. In the filing, American also detailed the terms of its aircraft financial commitments, saying it has secured the right to defer 13 of 16 Boeing 737 MAX aircraft deliveries scheduled for 2021 and 2022 if it does not have committed financing. Previous financing for some of the aircraft that American was meant to receive in 2020 had expired as Boeing Co BA.N froze 737 MAX deliveries during a 20-month safety ban that finally ended in the United States in November.
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Jan 29 (Reuters) - American Airlines AAL.O has authorized the sale of another $1 billion in stock, expanding upon a $1 billion offering announced last October to boost liquidity, the company said in a regulatory filing on Friday. The new plan follows a stock surge on Thursday after the carrier was mentioned on Reddit's WallStreetBets forum. In the filing, American also detailed the terms of its aircraft financial commitments, saying it has secured the right to defer 13 of 16 Boeing 737 MAX aircraft deliveries scheduled for 2021 and 2022 if it does not have committed financing.
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4755.0
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2021-01-28 00:00:00 UTC
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S&P 500 Movers: LUMN, AAL
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https://www.nasdaq.com/articles/sp-500-movers%3A-lumn-aal-2021-01-28
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In early trading on Thursday, shares of American Airlines Group topped the list of the day's best performing components of the S&P 500 index, trading up 21.6%. Year to date, American Airlines Group registers a 27.6% gain.
And the worst performing S&P 500 component thus far on the day is Lumen Technologies, trading down 11.7%. Lumen Technologies Inc is showing a gain of 39.1% looking at the year to date performance.
Two other components making moves today are Whirlpool, trading down 7.6%, and ABIOMED, trading up 13.1% on the day.
VIDEO: S&P 500 Movers: LUMN, AAL
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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VIDEO: S&P 500 Movers: LUMN, AAL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Year to date, American Airlines Group registers a 27.6% gain. And the worst performing S&P 500 component thus far on the day is Lumen Technologies, trading down 11.7%.
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VIDEO: S&P 500 Movers: LUMN, AAL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. In early trading on Thursday, shares of American Airlines Group topped the list of the day's best performing components of the S&P 500 index, trading up 21.6%. Year to date, American Airlines Group registers a 27.6% gain.
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VIDEO: S&P 500 Movers: LUMN, AAL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. In early trading on Thursday, shares of American Airlines Group topped the list of the day's best performing components of the S&P 500 index, trading up 21.6%. And the worst performing S&P 500 component thus far on the day is Lumen Technologies, trading down 11.7%.
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VIDEO: S&P 500 Movers: LUMN, AAL The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. In early trading on Thursday, shares of American Airlines Group topped the list of the day's best performing components of the S&P 500 index, trading up 21.6%. And the worst performing S&P 500 component thus far on the day is Lumen Technologies, trading down 11.7%.
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4756.0
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2021-01-28 00:00:00 UTC
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Breakingviews - Breakdown: GameStop, a financial markets whodunnit
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https://www.nasdaq.com/articles/breakingviews-breakdown%3A-gamestop-a-financial-markets-whodunnit-2021-01-28
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Reuters
Reuters
NEW YORK (Reuters Breakingviews) - The wild surges in so-called meme stocks like GameStop have created the financial-markets equivalent of a whodunnit. As with detective mysteries, there’s a weapon, an opportunity for enrichment and a motive. What’s harder to find is a victim. And because the irrational moves in a widening array of stocks poses a direct challenge to high finance, the punishment will likely outweigh the crime.
THE FRACAS
Video-game retailer GameStop was unloved, and little traded, by big-time investors. Then its shares started to rocket. And kept rocketing. On the surface, this is because users of online forums like Reddit had noticed that the stock was heavily bet against by large investors and figured that what had gone down could be made to go up. This “go long-the-shorts” strategy spilled over into other heavily bet-against stocks, like American Airlines, BlackBerry and even video-store dinosaur Blockbuster.
Underneath GameStop’s chaotic rise is a company, and some people – including Chief Executive George Sherman, and recent investor Ryan Cohen, the entrepreneur behind Chewy, the online pet retailer. But GameStop itself, which was worth just $1.4 billion a month ago, is no longer the point. The company has disappeared into a swelling cast of bystanders and commentators, from Tesla boss Elon Musk to Senator Elizabeth Warren. The Securities and Exchange Commission is “monitoring” the situation.
THE WEAPON
There are two. First, the options market. Buying call options in a company lets investors take bigger risks than they can by simply acquiring shares, especially if they also borrow to acquire the securities. Options can easily be worthless when they expire. Conversely, there’s theoretically no limit to how much the option’s value can rise, and an option-holder only needs to put down a fraction of the stock’s value to get that exposure.
Behind the curtain, a market-maker like Citadel Securities that facilitates this activity is trading in actual shares so as to be protected whatever happens. And because of the wizardry of options arithmetic, the closer it gets to the price at which the option can be exercised, the more the market-maker needs to buy. That pushes up the price still further. The result can be what participants call a gamma squeeze. People in the real world call it “holy cow: GameStop shares are up 1,000% in a week.”
The other weapon, though, is money. Without that, there’s no trading. And if there’s one thing America has an abundance of right now, it’s cash. For many people, Covid-19 has created additional disposable income, and a combination of fiscal stimulus and loose monetary policy has pumped up the supply of funds. Deposits in commercial banks rose by $3 trillion in 2020, according to the Federal Reserve. That’s more than was added in the preceding five years.
THE OPPORTUNITY
Taking a punt on GameStop, or any stock and its options, has never been simpler, thanks to the growth of apps like Robinhood Markets that have brought zero-cost trading to the locked-down masses. Covid-19 and its associated restrictions, including on sports, have given millions of people plenty of spare time in which to scroll through online forums, get angry at the Wall Street elites and place bets.
Behind that trend, though, are some bigger ones. Americans have ever more reasons to buy stocks. One is that interest rates, which determine rates paid on bank deposits, are at rock-bottom levels. Meanwhile, retirees are increasingly left to fend for themselves, in a world where healthcare costs are rising, and defined-benefit pension schemes are a distant memory for most. More than half of American households own stocks in some form, according to Pew Research.
Part of the opportunity was already being removed on Thursday, after Robinhood and Interactive Brokers brought in restrictions on trading certain stocks. GameStop fell by more than 75% at one point. But the move towards more retail investors engaging with equities and other securities, and being able to do so easily and cheaply, is not going away.
THE MOTIVE
This is where things get tricky – or at least, less scientific. Investors clearly believe they can make money when stocks rise, and they are correct. Look no further than Tesla, whose shares have risen eightfold in a year, despite CEO Musk warning at one point that its share price could go down “like a souffle under a sledgehammer.”
But the calculus on acceptable losses has also changed. Traders buying into GameStop can see the company’s struggling finances, and they know the risk of buying options, but they forge ahead anyway. Some may lose their shirts – others their homes. Some will just end up a bit poorer, with a story to tell.
This shouldn’t be a surprise. Nobel Prize-winning economists Esther Duflo and Abhijit Banerjee showed that in the world of economics, development experts are often surprised to see that extremely poor households who come into extra cash are often more likely to spend it on tobacco, alcohol or parties than they are extra calories. Humans need entertainment. Playing the stock-market casino fits the bill.
THE VICTIM
A whodunnit needs a body, but so far, there isn’t one to be seen. While investors will lose money, it’s hard to see how this threatens the safety and soundness of the financial system. Some hedge funds that had shorted stocks faced big losses, but that’s hardly a systemic issue. Citadel and fellow hedge fund Point72 both bailed out Melvin Capital, one of the original firms betting against GameStop.
A bigger worry would be if, because of these swings, the markets seized up, and viable companies could no longer raise capital, or if retail investors more broadly lost their faith in the stock market as a means of creating wealth. Ditto, if investors struggling to cover losses in some companies dump their stakes in others, creating a market-wide slump. Again, there’s little sign of that happening.
Conceptually, though, there are some victims, and the kind who are well placed to seek revenge. The whole, huge financial system is built around Wall Street banks that prize themselves on their ability to price risk accurately and make money out of market dislocations. The volatility created by manic trading is good for them, but the specter of prices that make no sense can persist for quite a while, and may not be.
THE RECKONING
Robinhood’s evasive action shows it has read the room: any reprisals for the market antics of this week are likely to focus on the company that led in providing the opportunity.
Most likely, that will revolve around the idea of “gamification,” a word that Massachusetts regulators used in their critique of the trading app in December. The regulator’s contention was that by making trading seem like a game and using engagement techniques that casinos deploy to keep users hooked, Robinhood was acting irresponsibly. The SEC may now take up the question. Trading apps might have to come with bigger, uglier health warnings, like cigarettes.
Is that overkill? Probably. There’s little chance that Reddit vigilantes will upset the functioning of stock markets over the long term. But that’s not really the point. Just as GameStop doesn’t have to be worth $25 billion for the shares to hit that value, Reddit vigilantes don’t need to storm Wall Street’s battlements to be perceived as a threat that needs to be de-fanged.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Underneath GameStop’s chaotic rise is a company, and some people – including Chief Executive George Sherman, and recent investor Ryan Cohen, the entrepreneur behind Chewy, the online pet retailer. Covid-19 and its associated restrictions, including on sports, have given millions of people plenty of spare time in which to scroll through online forums, get angry at the Wall Street elites and place bets. Just as GameStop doesn’t have to be worth $25 billion for the shares to hit that value, Reddit vigilantes don’t need to storm Wall Street’s battlements to be perceived as a threat that needs to be de-fanged.
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Buying call options in a company lets investors take bigger risks than they can by simply acquiring shares, especially if they also borrow to acquire the securities. Investors clearly believe they can make money when stocks rise, and they are correct. The whole, huge financial system is built around Wall Street banks that prize themselves on their ability to price risk accurately and make money out of market dislocations.
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Buying call options in a company lets investors take bigger risks than they can by simply acquiring shares, especially if they also borrow to acquire the securities. Taking a punt on GameStop, or any stock and its options, has never been simpler, thanks to the growth of apps like Robinhood Markets that have brought zero-cost trading to the locked-down masses. A bigger worry would be if, because of these swings, the markets seized up, and viable companies could no longer raise capital, or if retail investors more broadly lost their faith in the stock market as a means of creating wealth.
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First, the options market. Without that, there’s no trading. Look no further than Tesla, whose shares have risen eightfold in a year, despite CEO Musk warning at one point that its share price could go down “like a souffle under a sledgehammer.” But the calculus on acceptable losses has also changed.
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4757.0
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2021-01-28 00:00:00 UTC
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Stock Markets Recover; Airlines Gain Altitude Despite Red Ink
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https://www.nasdaq.com/articles/stock-markets-recover-airlines-gain-altitude-despite-red-ink-2021-01-28
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The stock market rebounded sharply on Thursday from its losses the previous day as investors looked beyond all the short-selling controversy and focused instead on the growing likelihood of additional stimulus for the U.S. economy. The Dow Jones Industrial Average (DJINDICES: ^DJI), S&P 500 (SNPINDEX: ^GSPC), and Nasdaq Composite (NASDAQINDEX: ^IXIC) finished well off their highs, but they still finished with solid gains on Thursday.
INDEX
PERCENTAGE CHANGE
POINT CHANGE
Dow
+0.99%
+300
S&P 500
+0.98%
+37
Nasdaq Composite
+0.50%
+67
Data source: Yahoo! Finance.
Airline stocks have been in the news lately because they've been at the epicenter of the COVID-19 pandemic and its impact on the economy. Today, Southwest Airlines (NYSE: LUV) and American Airlines Group (NASDAQ: AAL) gave their latest reports on how they're faring, and gains for their stocks showed some optimism for the road ahead.
Image source: Getty Images.
Southwest flies higher
Shares of Southwest Airlines finished the day up 1%. The airline is still struggling from the impact of the COVID-19 pandemic, but investors seemed generally encouraged by what the future could bring.
The numbers at Southwest certainly looked ugly. Fourth-quarter operating revenue came in 65% lower than the previous year's period, with revenue per available seat mile falling more than 40%. The airline lost $761 million in the quarter even leaving out special items, bringing the company's total adjusted net loss for the full year to $3.5 billion.
Southwest highlighted the fact that it still has $14.3 billion in available liquidity. That's considerably higher than its debt and gives it a solid cushion to withstand the ramping-up period once the pandemic is under control.
However, Southwest isn't seeing even the coronavirus vaccine rollout as helping it substantially in the near term. The airline is therefore expecting roughly $17 million per day of cash burn through the first quarter, with hopes that it'll be able to break even on a cash flow basis for the full year in 2021. With load factors of just 50% to 55% expected for January and February, and revenue down 65% to 70% in January and 65% to 75% in February, Southwest still needs a lot of improvement.
American
Elsewhere among airlines, American Airlines Group's fourth-quarter report had much the same view of the industry. Yet its stock surged, climbing more than 9%.
Again, American wasn't able to deliver any rosier a picture of its affairs than Southwest. Revenue during the quarter was down 64% from year-ago levels. Capacity fell 53%, and the company lost $2.2 billion, capping a year with $9.5 billion in red ink on an adjusted basis.
Like Southwest, American was focused on liquidity. American expects to complete the first quarter of 2021 with about $15 billion in liquidity available. That'll be essential, as the company burned about $30 million per day in cash during the fourth quarter. At the same time, American was also pleased at its competitive stance. CEO Doug Parker said that American flew more customers than any other airline in 2020.
In the first quarter, American sees things continuing to look depressing. Total revenue will likely be down 60% to 65% compared to where levels were two years ago in 2019, with capacity down 45%.
A year of recovery
For both Southwest and American, 2021 is destined to be a year of recovery. The unanswered question, though, is how much the airlines will be able to recover while there's still so much uncertainty both in the airline industry and in the broader market overall.
10 stocks we like better than Southwest Airlines
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*Stock Advisor returns as of November 20, 2020
Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool recommends Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Today, Southwest Airlines (NYSE: LUV) and American Airlines Group (NASDAQ: AAL) gave their latest reports on how they're faring, and gains for their stocks showed some optimism for the road ahead. The stock market rebounded sharply on Thursday from its losses the previous day as investors looked beyond all the short-selling controversy and focused instead on the growing likelihood of additional stimulus for the U.S. economy. The airline lost $761 million in the quarter even leaving out special items, bringing the company's total adjusted net loss for the full year to $3.5 billion.
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Today, Southwest Airlines (NYSE: LUV) and American Airlines Group (NASDAQ: AAL) gave their latest reports on how they're faring, and gains for their stocks showed some optimism for the road ahead. The stock market rebounded sharply on Thursday from its losses the previous day as investors looked beyond all the short-selling controversy and focused instead on the growing likelihood of additional stimulus for the U.S. economy. The airline lost $761 million in the quarter even leaving out special items, bringing the company's total adjusted net loss for the full year to $3.5 billion.
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Today, Southwest Airlines (NYSE: LUV) and American Airlines Group (NASDAQ: AAL) gave their latest reports on how they're faring, and gains for their stocks showed some optimism for the road ahead. American Elsewhere among airlines, American Airlines Group's fourth-quarter report had much the same view of the industry. 10 stocks we like better than Southwest Airlines When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen.
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Today, Southwest Airlines (NYSE: LUV) and American Airlines Group (NASDAQ: AAL) gave their latest reports on how they're faring, and gains for their stocks showed some optimism for the road ahead. American Elsewhere among airlines, American Airlines Group's fourth-quarter report had much the same view of the industry. Like Southwest, American was focused on liquidity.
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2021-01-28 00:00:00 UTC
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Consumer Sector Update for 01/28/2021: CMCSA,EAT,AAL,FLWS
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AAL
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https://www.nasdaq.com/articles/consumer-sector-update-for-01-28-2021%3A-cmcsaeataalflws-2021-01-28
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Consumer stocks held on to most of their Thursday advance, with the SPDR Consumer Staples Select Sector ETF climbing 0.7% while the SPDR Consumer Discretionary Select Sector ETF also was rising 0.7%.
In company news, Comcast (CMCSA) added 6.8% on Thursday after the internet, cable and broadcast television company reported better-than-expected fourth-quarter results and also increased its quarterly dividend by 9% to $0.25 per share. Excluding one-time items, it earned $0.56 per share on $27.71 billion in revenue during the final three months of 2020, topping the Capital IQ consensus expecting $0.48 per share and $26.76 billion, respectively.
Brinker International (EAT) climbed 8% after MKM Partners raised its price target for the restaurant chain by $7 to $67 a share and also reiterating its buy rating for its stock.
American Airlines (AAL) was 9.5% higher in late trade, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Revenue plunged 64.3% year-over-year to $4.03 billion, also exceeding the $3.86 billion Street view.
1-800 FLOWERS.COM (FLWS) dropped 10.5%, giving back an earlier 8.6% gain to a best-ever $39.39 a share that followed the online flowers and gifts seller reported a $1.71 per share profit for its fiscal Q2 ended Dec. 27, up from $1.12 per share during the year-ago quarter and topping the Capital IQ consensus by $0.32 per share. Net sales grew 44.9% to $877.3 million, also beating the $755.5 million analyst mean.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (AAL) was 9.5% higher in late trade, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. In company news, Comcast (CMCSA) added 6.8% on Thursday after the internet, cable and broadcast television company reported better-than-expected fourth-quarter results and also increased its quarterly dividend by 9% to $0.25 per share. Brinker International (EAT) climbed 8% after MKM Partners raised its price target for the restaurant chain by $7 to $67 a share and also reiterating its buy rating for its stock.
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American Airlines (AAL) was 9.5% higher in late trade, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Consumer stocks held on to most of their Thursday advance, with the SPDR Consumer Staples Select Sector ETF climbing 0.7% while the SPDR Consumer Discretionary Select Sector ETF also was rising 0.7%. Excluding one-time items, it earned $0.56 per share on $27.71 billion in revenue during the final three months of 2020, topping the Capital IQ consensus expecting $0.48 per share and $26.76 billion, respectively.
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American Airlines (AAL) was 9.5% higher in late trade, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Excluding one-time items, it earned $0.56 per share on $27.71 billion in revenue during the final three months of 2020, topping the Capital IQ consensus expecting $0.48 per share and $26.76 billion, respectively. 1-800 FLOWERS.COM (FLWS) dropped 10.5%, giving back an earlier 8.6% gain to a best-ever $39.39 a share that followed the online flowers and gifts seller reported a $1.71 per share profit for its fiscal Q2 ended Dec. 27, up from $1.12 per share during the year-ago quarter and topping the Capital IQ consensus by $0.32 per share.
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American Airlines (AAL) was 9.5% higher in late trade, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Excluding one-time items, it earned $0.56 per share on $27.71 billion in revenue during the final three months of 2020, topping the Capital IQ consensus expecting $0.48 per share and $26.76 billion, respectively. Revenue plunged 64.3% year-over-year to $4.03 billion, also exceeding the $3.86 billion Street view.
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4759.0
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2021-01-28 00:00:00 UTC
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American Airlines Group (AAL) Q4 2020 Earnings Call Transcript
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https://www.nasdaq.com/articles/american-airlines-group-aal-q4-2020-earnings-call-transcript-2021-01-29
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Image source: The Motley Fool.
American Airlines Group (NASDAQ: AAL)
Q4 2020 Earnings Call
Jan 28, 2021, 8:30 a.m. ET
Contents:
Prepared Remarks
Questions and Answers
Call Participants
Prepared Remarks:
Operator
Good morning and welcome to the American Airlines Group fourth-quarter 2020earnings call Today's conference call is being recorded. [Operator instructions] Following the presentation, we will conduct a question-and-answer session. [Operator instructions] And now, I would like to turn the conference to your moderator, managing director of investor relations, Mr.
Dan Cravens.
Dan Cravens -- Managing Director of Investor Relations
Thanks, Victor, and good morning, everyone. And welcome to the American Airlines Group fourth-quarter 2020earnings conference call Joining us on the call this morning, we have Doug Parker, our chairman and CEO; Robert Isom, president; and Derek Kerr, our chief financial officer. Also on the call for the Q&A session are several -- several of our senior executives, including Maya Leibman, Steve Johnson, Vasu Raja, Alison Taylor, and David Seymour.
Like we normally do, Doug will start the call with an overview of our quarter and a -- and the actions we've taken during this pandemic. Robert will then fall -- follow with some remarks about our commercial and other strategic initiatives. After Robert's remarks, Derek will follow up -- follow with the details on the quarter and our operating plans going forward. After Derek's comments, we'll open the call for analysts' questions, and lastly, questions from the media.
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Before we be -- begin, we must state that today's call does contain forward-looking statements, including statements concerning future revenues, cost, forecast of capacity, fleet plans, and liquidity. These statements represent our predictions and expectations as to future events, but numerous risks and uncertainties could cause actual results to differ from those projected. Information about some of these risks uncer -- and uncertainties can be found in our earnings press release [Inaudible] this morning, as well as our Form 10-Q for the quarter ended September 30, 2020. In addition, we'll be discussing certain non-GAAP financial measures this morning, which ex -- exclude the impact of unusual items.
A reconciliation of those numbers to the GAAP results is included in the earnings press release and that can be found on the investor relations section of our website. A webcast of this call will also be archive -- archived on our website. The information that we're giving you on the call is as of today's date, and we undertake no obligation to update the information subsequently. So thanks again for joining us.
And at this point, I'll hand the call over to our chairman and CEO, Doug Parker.
Doug Parker -- Chairman and Chief Executive Officer
Thank you, Dan. Thanks, everyone, for being with us. So look, before I begin my prepared remarks, I want to pre-emptively state that we will not be commenting nor answering questions on the recent activity in our stock price. As a rule, we don't speculate on the day-to-day movements in our share price and we'll stick to that rule today.
So well, we do have a lot to talk about. So I'll just start it, and then Robert and Derek will add some more, and we'll take questions after that as -- as we always do. So look, 2020 -- 2020 was obviously an incredibly difficult year. But we couldn't be prouder of what the American Airlines team accomplished in the face of extraordinary challenge.
Our team got the country and economy moving, and they did so safely and with great care. American Airlines flew more customers last year than any other -- any other airline. And our team did so while running a solid operation, ensuring our aircraft and airport facilities were clean and safe for every customer who needs us. The year ended on a high note with the extension of the payroll support program.
This positive outcome is the result of the company and union leadership working arm and arm, bring PSP2 over the finish line. It's clear that great things go about when we raise our voices together for the greater good. Of course, we're also grateful to our elected officials who recognize that the airline industry plays a vital role in the recovery from the pandemic. We talked a lot about the best days here in Americans.
We use that term to describe moments that make American truly unique and why our team believes it's the best airline in the world. December 24 was that best day for me. We welcomed back all of our furloughed team members and reinstated their pay and benefits. Thanks to our tremendous support teams working around the clock, we were able to deliver thousands of colleagues their first paycheck in months.
It's easy to forget that a lot happened in 2020 on top of navigating a pandemic. Yes, we took aggressive steps to permanently lower our costs, increase our liquidity, and care for customers in ways we've never seen before through the COVID-19. But we also accomplished significant milestones like entering into groundbreaking new partnerships and reach -- and reaching a new joint collective bargaining agreement covering our fleet and maintenance colleagues. And just last month, we seamlessly returned the Boeing 737 MAX to commercial service.
We'll talk more about the other accomplishments shortly. As we sit here today, I can unequivocally state that despite every challenge thrown our way, I've never been prouder of a co -- of a company in my entire career. The American Airlines team and our industry is incredibly resilient, and this past year has proven that. As we turn our attention to the year ahead, 2021 will be a year of recovery.
There's still a lot of unknowns, of course, when or how quickly demand will return. But make no mistake, it will return. The good news is there are vaccines. And while it will take some time for them to be widely distributed, progress is being made every day and that's encouraging.
We don't know exactly when we may return to prior levels of demand. What we do know is that we're prepared to withstand the ongoing crises irrespective of how long the recovery takes. We ended the year with over $14 billion of total available liquidity. And more importantly, we've used this opportunity to make American much stronger.
When the recovery does occur, we'll be prepared and even better positioned than we were prior to the pandemic. And we'll do so. I think of our team, our customers, and our company. On the team front, we're proud of the progress we've made especially in 2020.
This crisis has brought the American team together, strengthened the relationship between management and our unit -- and our union partners in incredible ways. Since the onset of the pandemic, we've been meeting with our unions every two weeks to discuss the company's response to the crisis and our path forward. And we stood side by side as we work to advocate for PSP -- PSP2. And while we made the difficult decision to furlough 19,000 team members last fall, we prepared for that reality in a way that was cooperative and collaborate with our union partners.
Our hope is to expand what we've accomplished in the past year, knowing that together we can be the best in the industry and advocating and caring for our team. For our customers, we're doubling down on operational excellence. Once we're back at full speed, we're positioned to run the best airline American Airlines has ever run through its operating reliability. We've reset our network to focus even more on our strongest and best-performing hubs, and migrated to a much simpler, more modern fleet.
We've talked before about efficient growth in Dallas Fort Worth, Charlotte, and that work is now done. We continue to modernize our -- our facilities at Washington Reagan and improve the connectivity of Chicago O'Hare, Phoenix, Philadelphia, and Miami. And we're building a much stronger network than we had before. In addition to the inherent strength of our hubs, in 2020, we establish new and innovative partnerships with Alaska and JetBlue that will make us stronger on the West Coast and in the Northeast.
We also [Inaudible] over the past year to make American a much more efficient airline. We have -- we had a truly unique opportunity to shut down the largest airline in the world and rebuild around our strengths. This enabled us to bring forward and accelerate a number of efficiencies in 2020 that were originally planned for the longer term, and we are passionately pursuing those efficiencies as we recover through 2021. Derek will elaborate on this in his remarks, but two of the best examples are the permanent retirement of more than 150 aircraft and five different aircraft types, and the 30% reduction in our management staff.
We believe the efficiencies we've built in the business will drive more than $1.3 billion of permanent nonvolume-related, nonfuel-related savings in 2021, and of course, beyond. So in summary, we could not be more proud of the work the American Airlines team has accomplished over the past year. We're very well-positioned and feel great about where American is going to be as demand returns. With that, I'll turn it over to Rob.
Rob Isom -- President
Thanks, Doug, and good morning, everyone. I'd like to also thank the entire team for their tremendous efforts in navigating an exceptionally challenging year. Supporting our team members and customers was paramount in 2020, and it continues to be a priority as we move into 2021. We continue to expand our pre-flight COVID-19 testing to make travel easier, including pre-flight testing for certain international destinations and at-home testing for travel to all U.S.
cities requiring negative tests. In the fourth quarter, we began the rollout of a digital health passport, VeriFLY. So customers can easily confirm testing and COVID-19 travel requirements, and streamlined airport check-in. This tool is now available for travel to many international locations and for travel in the United States.
Starting today, customers also will have the ab -- ability to use VeriFLY for travel to the U.S., to the U.K., and Canada as we will continue expanding our use of VeriFLY this year to o -- open up new -- to open up international travel in key markets. With cleanliness and safety top of mind, last month, we were pleased to achieve STAR certification in the Global Biorisk Advisory Council for our entire fleet of aircraft and for our Admirals Club lounges. This is a testament to the effective cleaning, disinfection, and infectious disease protocols we put in place over the past year. That caused us to return to the skies.
We've taken a number of steps to give them flexibility and competence when they book with American. We've eliminated the change fees on most domestic and international itineraries and fees for mi -- mileage reinstatement on canceled work bookings, domestics sa -- same-day travel standby -- standby travel, and reservations booked by phone. We also made it easier for top-tier customers to earn AAdvantage elite status, paused mileage expiration through June 30, 2021, extended 2020 status into 2022 for all members. Each of these efforts is predicated on our philosophy that American Airlines should be the easiest airline to do business with, and we'll continue delivering on that commitment as more people return to flight.
On fourth-quarter revenue -- our fourth-quarter revenue was down considerably versus 2019, 64% year over year. But we saw improvements compared to the third quarter when revenue was down 73% year over year. The momentum we saw heading into the fourth quarter was tempered by the su -- the surge in COVID-19 cases and has -- and the increased travel restrictions in many parts of the country. As we have done throughout the pandemic, we responded by making closing adjustments to our schedule while maximizing the connectivity of our network.
And in a testament to our team, that our fourth-quarter passenger unit revenues were by far the best in the industry. We will continue to be flexible and match our future capacity with observed booking trends while playing to the strengths of our hubs and the parts of the country where travel demand is great. Our year-over-two-year basis, we currently expect our first quarter system capacity -- capacity to be down 45%. The recent CDC order to require a negative COVID test for entry into the U.S.
has had an impact on our international bookings. So many countries and hospitality providers are planning to make testing available to travelers, the timing and scale of these efforts remains -- remain unclear. Given this continued demand volatility, we will remain as flexible as possible and match capacity to demand. Our ongoing engagement with leisure operators will pay dividends as we head toward a recovery.
I want to acknowledge our sales team and entire customer organization for their work. This team was recently named Airline Partner of the Year by the American Society of Travel Advisors and the Best Overall Airline for Students and Youth by StudentUniverse, which are both important -- important accolades for such a challenging year. Cargo remains a bright spot for our business. Our cargo revenue in the fourth quarter was up 32% year over year despite flying in significantly reduced schedule.
In 2020, American operated more than 5,200 cargo-only flights, transporting 167 million pounds of critical goods and supplies around the world during the pandemic. Cargo will continue to be an area of focus in 2021. We remain optimistic about the recovery because of the changes that we've made to our network. We will offer customers the largest and most compelling global airline network thanks to the actions taken in 2020.
We will have a -- a -- the full run-rate benefit of our advocates in Dallas Fort Worth and Charlotte, our best-performing hubs. And we'll have a fantastic new facility at Reagan National that will enable us to upgrade to the hub. By the third quarter of 2021, all of our DCA flights will have a first-class product and we will eliminate the 50-seat regional jet operations there. Update simplification, continued upgrading, and improved connectivity will also scale the cost of our other connecting hubs and improve their weather -- revenue-generating cap -- capabilities as well.
By partnerships with Alaska and JetBlue will also create the best and largest network for our customers on the West Coast and in the Northeast. Customers will have access to a seamless network that allows us to focus our assets on what we do best. In New York, we will remove the 50-seat regional jets, upgrade our service, and offer a much more competitive network for customers. As a result, we will launch new long-haul international flights from New York this summer and we start service to Tel Aviv and Athens.
Similarly, we are working with Alaska on the West Coast. And this year, when demand returns, we will begin service from Seattle to London, Shanghai, and Bangalore. We have also announced a new integrated frequent-flyer offering and have signed new corporate contracts. This partnership is already creating value for customers throughout the West Coast, including our hub in Los Angeles.
Lastly, while we anticipate international demand will be slower to recover, we will use our strength in Latin America and our partnerships to create a leading international network. Our Latin American network has long been uniquely valued by our customers, and its performance during the pandemic is on stand out. Despite near-term demand volatility, we expect -- expect Latin America to recover sooner than the rest of our international network and we will continue to offer customers the largest and most comprehensive network in the region. We rationalize many parts of our transatlantic and transpacific networks during the pandemic and integrating more deeply with our partners.
As an example, through our partnership with Qatar Airways, we've been able to leverage Doha as a global connecting hub, which has opened up many new markets for our customers. As demand recovers, we anticipate leveraging these partnerships to start flights and increase global -- and increased global connectivity even more. We believe the structural changes we made in 2020 will enable us to produce industry-leading -- leading revenues and lower expenses through our focused customer proposition for other network in a smaller fleet. We will continue to adapt our business to customers' needs and we'll keep working hard to make sure that they have peace of mind when they travel.
And with that, I'll turn it over to Derek.
Derek Kerr -- Chief Financial Officer
Thanks, Robert, and good morning, everyone. Before I begin my remarks, I would also like to thank our entire team for their tenacity and resilience throughout the pandemic. While 2020 was certainly a financially difficult year for the airline, the collaboration, teamwork, and sheer grit our team demonstrated was impressive. This morning, we reported a fourth-quarter GAAP net loss of $2.18 billion or $3.81 per share.
Excluding $32 million of net special nonoperating items, we reported a net loss of $2.21 billion or $3.86 per share. For the full-year 2020, we reported a GAAP net loss of $8.9 billion. And excluding net special items, we reported a net loss of $9.5 billion. Robert talked about what we're seeing with the revenues, so I'll focus my remarks on the cost side of the P&L.
Through aggressive actions, we have reduced our fourth-quarter total operating expense, including net special items, by 37% versus 2019. We remained focused on aligning our costs with capacity while preserving the maximum amount of flexibility to respond to customer demand. We have accelerated several of our long-term efficiency plans, and as Doug mentioned, we're on track to permanently remove at least $1.3 billion from our cost structure in 2021 and beyond. At the end of the fourth quarter, we had approximately $14.3 billion of total available liquidity.
Costs were flat from the third quarter to the fourth, and we continue to see a positive trend in our daily cash burn rate -- rate, which improved from approximately $44 million per day in the third quarter to approximately $30 million per day in the fourth quarter. The reduction was due to revenue improvements on higher capacity. As a reminder, our definition of cash burn includes $8 million per day of regular debt principal and cash severance payments. During the quarter, our treasury team did a phenomenal job of continuing to strengthen our liquidity through a series of capital market transactions.
We raised approximately $1.5 billion of incremental cash through two equity transactions to strengthen our balance sheet composition, and we still have $118 million left on our previously announced at-the-market equity authorization. I would like to take this opportunity to specifically thank our recently retired treasurer, Tom Weir. Tom has been an invaluable member of our team -- our team for more than 20 years. His expertise will be missed, but I am confident our new treasurer, Meghan Montana, and her team -- and her team will pick up right where Tom left off.
During the quarter, we took delivery of 10 MAX, 737 MAX aircraft, and we expect to take another seven this quarter. These aircraft were built while the MAX was grounded and were efficiently financed through sale-leaseback transactions. Also, as a reminder, we reached an agreement with Boeing to secure deferral rights on eight of our 2021 MAX deliveries and all 10 of our MAX deliveries in 2022. We have deferred five of these aircraft to date.
And as I mentioned last quarter, to avoid exercising additional deferral rights, we would need to see substantial improvement in the demand environment. As Doug discussed in his opening remarks, as we look ahead to a recovery in 2021, we are passionately pursuing the initiatives we have put in place to make the airline more efficient when we are back to a normalized demand and capacity environment. Like all airlines, our plan -- our planning begins with our fleet. As we have mentioned on previous earnings calls, we have worked hard to rebuild our fleet into one that is simpler and much more efficient to operate while offering our customers a consistent and improved product and experience.
As part of that process, we have retired more than 150 older noncore aircraft, including five total fleet types, lowering our average fleet age to 11.2 years, the lowest of the U.S. net -- network carriers. Not surprisingly, the aircraft that we exited were the least cost-efficient aircraft in our fleet. With only four mainline aircraft types remaining, we will see improved aircraft utilization and operational efficiencies in the back half of 2021 through the increasing gauge, reduction in inactive aircraft, including spares and maintenance allocations.
Additionally, we have further accelerated our seat harmonization project and now expect the entire project to be complete by the end of 2021. When this work is done, we will have a more consistent product with more premium seats, larger overhead bins, and in-seat power. These projects will provide significant opportunities to not only improve revenue production but also lower our unit costs now and well into the future. As a result, when demand conditions improve, we could eventually reach 2019 levels of capacity with approximately 10% fewer aircraft.
We will also have a more efficient workforce on the other side of the pandemic. We reduced our management size by a third, resulting in an estimated $500 million of permanent cost reductions. For reference, that would drive more than an entire pre-tax margin point on our total revenue base for 2019. Beyond that, we have implemented $700 million in additional labor efficiencies that have been incorporated into our plans going forward.
These include but not limited to optimize staffing plans and the u -- utilization of technology to be more efficient across our operation. From many of our workgroups, these initiatives will allow us to achieve the best productivity levels that we have seen in years. Many of these projects would have come to fruition over time. But due to the extraordinary circumstances in 2020, we took the opportunity to accelerate and implement these efficiencies as part of our future foundation.
As we looked at the first quarter, there continues to be a tremendous amount of uncertainty with bookings. Stubbornly high COVID-19 cases and more stringent travel restrictions continue to constrain demand. And as a result, we expect the first-quarter demand environment to be very much like the fourth. As Robert noted, we expect capacity to be down 45%.
We also expect total revenue to be down approximately 60% to 65% versus the first quarter of 2019, similar to our fourth-quarter results. When this flat revenue performance is combined with known cost pressures from higher fuel, restoring pay to our furloughed workers, and volume-driven expenses, we expect our first-quarter pre-tax earnings, excluding special items, to be lower than the fourth quarter. We presently expect to end the quarter with approximately $15 billion in total available liquidity. This results in an average -- first-quarter average daily cash burn rate of approximately $30 million per day flat with the fourth quarter.
The first quarter in -- also includes approximately $9 million per day of debt principal and cash severance payments, which includes a $360 million WTC amortization, including the maturity of our 2011-1 WTC, which unencumbers 30 aircraft. Also included in our daily cash burn for the quarter is a $240 million contribution to our pension and $225 million in nonaircraft capex. In terms of our balance sheet, we feel good about the flexibility and ef -- and efficiency we have. Approximately 40% of our outstanding debt is prepayable without penalty, and we still do not have any large nonaircraft debt maturities until our $750 million unsecured bond matures in June 2022.
After all the COVID-related financings we completed in 2020, our average cost of debt is just over 4%. For guidance for the full year of 2021, our debt payments will be $2.9 billion and our pension payment is $695 million. Full-year capex will be $900 million of nonaircraft capex. And due to our negotiated settlements with Boeing discussed earlier and attractive aircraft financing, our net aircraft capex, including PDPs, will be an inflow of $1.2 billion.
As we have previously stated, when demand recovers, we expect to use all excess cash to further de-lever our balance sheet. Earlier this month, we received the first installment of approximately $3.1 billion of PSP2 funds from the Treasury Department, and negotiated an extension on the final draw date of the CARES Act loan facility from March 26 to May 28, 2021. This extension gives us more time to decide our liquidity needs for the year based on the pace of the recovery, as well as to evaluate alternatives to drawing the CARES Act loan. Our industry still has a long path re -- to recovery ahead.
But the actions we have taken in American to conserve cash, bolster liquidity, and drive permanent efficiencies across the business give us confidence that we are well-positioned for the year ahead and the long term. And with that, I'll open it up to questions from the analyst.
Questions & Answers:
Operator
[Operator instructions] Please standby while we compile the Q&A roster. And our first question comes from the line of David Vernon from Bernstein. You may begin.
David Vernon -- Sanford. C.Bernstein
Hey, good morning, guys. I'm wondering if you could help us frame what the cost actions you guys have taken and the efficiency that you guys put forth through this crisis. Frame how that -- how we should be thinking about EBITDA margins in a -- in a -- in a -- out year perspective from a '23 or maybe '24 level. If you think about the $1.3 billion of -- of nonoperating cost takeout plus the efficiencies in the fleet, if we get to revenue levels that we saw in 2019, where should we be thinking the EBITDA margins will shake out at that point?
Doug Parker -- Chairman and Chief Executive Officer
Hey -- hey, David. Really hard, of course, to project what 2023 margins are going to be without knowing what demand is going to be. So I guess this is what I think for most [Inaudible] tell you, the $1.3 billion is -- as -- as we describe is real sustainable. I -- I -- what we -- what [Inaudible] in that is if we -- if we were starting 2019 right now with this fleet, with this lay of organization, this management, this management team, our earnings in 2019 would have been $1.3 billion back.
But you care about that cause -- and -- and other things have happened with that. That would be better. We've got a contract out with our -- so -- but you want to make those adjustments. But it's real and it's -- it's -- it's a fundamental difference in the airline right now.
So you can use that to make your own 2023 projections.
David Vernon -- Sanford. C.Bernstein
Yeah, I -- I -- I know -- I realize it's difficult and nobody knows what demand is. I guess in our conversations with investors, it feels like people are framing your -- your -- your earnings power off of the 2019 base when it sounds like with the fleet changes you're making and with the cost reduction that's you're taking, that -- that -- that's -- that's too low of a starting point. And I guess I'm just trying to -- to -- to -- to understand if that is the right way to think about it or if you think that the earnings power of the businesses is -- is going to be materially higher or -- or higher than it was. Again, assuming the revenue environment stays [Inaudible]
Doug Parker -- Chairman and Chief Executive Officer
Yes, David, and I appreciate the question. It's -- it's really hard to figure out the margins because it so dependent on revenues. But to answer your question, to the extent that people are modeling 2023 with whatever revenue assumptions they want to, if you -- if you weren't -- if you didn't know that American Airlines is going to be $1.3 billion more efficient, you should build it in your models. If -- if you already suspected that, you don't have an adjustment to make.
That's -- that's where we are. It's -- it's -- those are real differences in the way this company is now structured versus where it was in 2019.
David Vernon -- Sanford. C.Bernstein
All right. Thanks for your time.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, David.
Operator
Thank you. Our next question comes from the line of Savi Syth from Raymond James. You may begin.
Savi Syth -- Raymond James -- Analyst
Hey, good morning, everyone. Just i -- if I might on -- on the cost side of things. Can you provide any color on like 1Q '21, what you're expecting on the opex side, including what might be temporary because of PSP2? And just a follow-up on -- on, Doug, your comments, response to David. I -- I think -- are you're basically saying that the 2019 -- 2019 capacity, you should see $1.3 billion less and kind of not -- nonfeel opex out of the system? Is that -- is that fair way to look at it?
Doug Parker -- Chairman and Chief Executive Officer
Yes.
Derek Kerr -- Chief Financial Officer
Yes. And -- and Savi to the -- to the answer. I mean the -- the one number that we do know is the -- the number added back to salaries is about $300 million, which is the amount of money that -- that we want higher salaries due to PSP2 coming back. The other is volume.
And then fuel price is definitely up. Fuel price -- and we -- and we gave you a 45% capacity. So I think if you take calculate where the price of fuel is now and that capacity increase, that fuel should be up right around $300 million where the curve is today. And then we have a little bit higher regional expenses because we're growing the regional a little bit by about $100 million.
So those are the key -- the three key things. The rest is just depending on volume of -- of growth that we have over the fourth quarter.
Savi Syth -- Raymond James -- Analyst
That -- that's helpful. All right. Thank you.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, Savi.
Operator
Thank you. Our next question comes from the line of Mike Linenberg from Deutsche Bank. You may be -- you may begin.
Mike Linenberg -- Deutsche Bank -- Analyst
Yeah. Hey. Two here. I guess Robert and Doug.
Robert, you sort of alluded to the fact that the new testing requirements that went into effect I guess earlier this week, it was obviously having some impact on maybe bookings to from Latin America, Caribbean, etc. What's -- what's thoughts on -- I know that the administration this week floated the possibility of domestic testing, and I just -- logistically, I just -- I can't get my arms around that and I'm not even sure if the airports would be -- would be able to facilitate it. Maybe it's an at-home type product and it sounds like maybe you are gearing up for that given what you're doing sort of behind the scenes. Can you just talk about that and whether or not that would even be feasible?
Doug Parker -- Chairman and Chief Executive Officer
Hey, Mike, it's Doug. Yeah, we certainly haven't been informed of that, so I think it's imminent. We -- we --what we know is what Robert said about international testing. We're doing that work with the Fed.
And Robert said it's had an impact on demand, certainly on short-haul international flight. But we're -- we're supportive of that. Anyway. Domes -- domestic testing is reasons you stated seems like something that would both be difficult and would have us testing Americans on airplanes that we all know are safe to be on.
So we'll -- we'll obviously work with the administration of what they think makes sense to our best to make sure that we're all doing everything we can to make sure that people are safe and also that we get through this pandemic as quickly as possible, which is our best interest, but also let them know what kind of impact that would have on -- on travel. But again, the bigger point is we have -- what -- what you say has been floated -- not even floated to us and so we -- we haven't heard anything directly from regulators or others about that possibility.
Mike Linenberg -- Deutsche Bank -- Analyst
OK, great. Very good. And then just a quick one to -- to Derek. You gave us the gross or you gave us the pension contribution for the year.
I think you said $695 million. How does that compare the -- what you anticipate expensing on the P&L? Thanks. Thanks for taking my questions.
Derek Kerr -- Chief Financial Officer
The expensing on the P&L is actually a credit of I think it's a -- let me get you back on that number, make sure we've got it right.
Mike Linenberg -- Deutsche Bank -- Analyst
Not a problem. Thanks, everyone.
Doug Parker -- Chairman and Chief Executive Officer
Thank you, Mike.
Operator
Thank you. Our next question comes from the line of Catherine O'Brien from Goldman Sachs. You may begin.
Catheine O'Brien -- Goldman Sachs -- Analyst
Hey, good morning, everyone. Thanks for the time. Hey. So my first one is on -- on the -- the 1.3 of the cost cut.
I guess could you just walk us through what some of the larger buckets are there? Sounds like fleet simplification, management team are decent -- management cuts are decent, percentage of that, I know you gave the $500 million for the management headcount reduction. And -- and then you touched on this a bit in your prepared remarks, but can you help us think about what proportion of that was event it pulling forward, initiatives already laid out versus maybe potentially some -- some new opportunities that came from turning over additional stones as a result of COVID?
Derek Kerr -- Chief Financial Officer
Yeah, I -- I would say -- I mean the -- the two big buckets as I talked about are the 500 in management and then the 700 in other labor. And that goes through all -- all groups. So it goes let's say as you -- as you get the summary, it's through every group: pilots, flight attendants, maintenance, fleet service. So -- so as we -- as we looked at every group, we -- we looked and see how can we be as efficient as we can in each one of these as we brought the people back.
So there's no -- that the biggest item definitely is management and that's the $500 million and the 700 of those and other things. We have a bunch of other items that are in that -- these facilities con -- consolidations, fuel efficiencies, benefits, a lot of other items that we have gone through to make sure that we're as efficient as possible. We do have other savings that are out there that due to volume will be down. But we'll have to see if those are permanent overtime and -- and whether they come back.
So I would say we did take advantage of this to do some of this earlier. All of it was on our plans over the next probably three years, but we've brought all of that forward. And as -- as we went through the process of unfortunately having to furlough people and as we bring people back, how do we -- how do we be as efficient as possible, and that's what we've done. Dynamic manning at the airport, single-agent boarding at airports, all of that stuff has been accelerated through this process and will be put in place as we -- as we grow back.
Catheine O'Brien -- Goldman Sachs -- Analyst
Got it. Understood. And -- and actually maybe one more for you, Derek. Can you just walk us through the -- through the calculus in determining how much cash you want to get on your balance sheet for the coming months just given the uncertainty? Is there a new minimum you want to have until demand gets back to a certain point and you just kind of factor in your expectations on cash burn to help decide on -- on potential incremental raises? Or is it really just more opportunistic to either use that lead to pay down debt in the future or keeping a pulse on the market, see if there are opportunities to rid of the most expensive debt? Would -- would --
Derek Kerr -- Chief Financial Officer
Yeah.
Catheine O'Brien -- Goldman Sachs -- Analyst
Yeah, thanks.
Derek Kerr -- Chief Financial Officer
Yeah, I think -- I think -- I mean we don't -- we don't have any requirements other than the 750 in 2022. And then we do have some payments, some term loans, and some to come up in 2023. So right now, the -- we've gotten ourselves at the end of this quarter, we -- we'll be at $15 billion, a significant amount above the $7 billion we had in the past. So I think the liquidity is there.
But we -- we have to keep our pulse out and we have to keep watch that, see where the recovery is. But we -- we are going to be opportunistic. Our -- our biggest -- we talked about the government loan, which we have, $7.5 billion against the -- the frequent-flyer program for that government loan which we would have to pull by May of 28. The determination of what do we do there is -- is one of our -- one of the biggest things we're going to do in the next few months.
But we're happy with the liquidity level where we're at. We're -- we're in a really strong position. We don't have a lot of capex coming forward in the next two years at all. As I -- I talked about, our actual net capex is positive this year, which will bring in cash flow for us.
So our biggest -- our biggest thing to look at right now is -- is the government loan. How do we refinance that? Actually, we haven't pulled it yet. So how do we -- what do we do for using that collateral and how much liquidity do we raise in that transaction? But we're really comfortable where we're at and we don't have a lot of commitments going forward from an aircraft standpoint or capex standpoint or debt standpoint in the next two years.
Catheine O'Brien -- Goldman Sachs -- Analyst
Understood. Thanks.
Operator
Thank you. Our next question comes from the line of Hunter Keay from Wolfe Research. You may begin.
Hunter Keay -- Wolfe Research -- Analyst
Hey, good morning, everybody.
Doug Parker -- Chairman and Chief Executive Officer
Hey, Hunter.
Hunter Keay -- Wolfe Research -- Analyst
Hey. A couple for you, Derek, probably. What's the latest on the -- the 787 delivery schedule for this year? And -- and just -- can you just give us a rundown on what you're planning for aircraft deliveries this year next and -- and how many of them you're already financing in place for?
Derek Kerr -- Chief Financial Officer
Yeah. Yeah. So we have -- right now, we haven't changed the delivery schedule on 788 yet. We have 19 deliveries coming this year, all fully financed.
And -- and as of right now, they're coming, but we are -- we are talking with our partners on -- on those aircraft. The MAX, we have eight more coming. Seven will come this quarter, all fully financed. And we have 16 NEOs coming, all of those fully financed.
So our -- our actual net aircraft capex, when we just talk about capex, is -- it's actually a positive. So those aircraft coming in will be positive cash flow. We -- next year, we have 26 air -- Airbus 3 -- 321s coming in, no financing. We have backstop financing on those, but no permanent financing yet.
So we're working on 2022. We won't take any aircraft that don't have financing going forward. So we're fully financed on all 2021 with sig -- with really good financing. And we still are -- are looking at 2022 right now.
And -- and -- and we -- we will look -- as we look at the Airbus planes next year and the 78s, we'll continue to look at those aircraft as -- as we talk to manufacturers.
Hunter Keay -- Wolfe Research -- Analyst
Super helpful. Thanks, Derek. And then just two -- two sort of quick clean up. One is interest expense.
Can you help me out with that this year and next would be great, even '23 if you want to take a stab at it? And then when does your blackout period end? Thanks.
Derek Kerr -- Chief Financial Officer
I'll get you the number. To blackout period ends today or tomorrow.
Hunter Keay -- Wolfe Research -- Analyst
OK.
Derek Kerr -- Chief Financial Officer
And I'll be back down in interest expense numbers.
Hunter Keay -- Wolfe Research -- Analyst
OK, great. I'll wait.
Operator
Thank you. Our next question will come from the line of Dan McKenzie from Seaport Global. You may begin.
Dan McKenzie -- Seaport Global -- Analyst
Hey, thanks. Good morning, guys. Question on corporate demand. The broad view is that it's -- it's permanently impaired.
And I just wondering if you can elaborate on the latest conversations with your corporate travel managers, what that path to recovery might look like? I'm pretty sure there's no airline planning for 50% permanent decline in the span and I'm thinking Americans got some share shift here. But I'm just wondering if you could just help us connect the dots on that -- on this part of the recovery story?
Vasu Raja -- Chief Revenue Officer
Yeah. Hey, Dan, this is Vasu. I'll -- I'll start into that. Look, the reality is -- is corporate travel demand is down.
It is 5% to 10% of -- of what its historical levels were. And though we're very optimistic that it'll return as vaccines are distributed, the timing, the speed, the -- the -- the rate of that is unfair at best. But also, as -- as important as that is, the -- the thing that really never forget, I -- I mentioned this a lot, I'll do it again here, is the power of the network business, right? That -- that for us, as the primary value we create -- as we create more origin and destination markets for customers, that creates more value for them and that results in them, they're paying us more for that product. And indeed, what we see right now is that 50% of the revenue that we're drawing are from origin and destination markets where really American Airlines has the best network or, in some cases, the only travel option.
And indeed, the yields in those markets are 50% higher than in markets where our product is the most monetized and a ton of different carriers can provide the O&D. So that's a huge degree of -- of leverage in the business because, of course, the -- the big way of going versus if we can move our capacity around. And so in a world where -- where corporate travel is slow to come back, and we expect that it is, we -- what we've really tried to do is make the airline as limber as possible so that we can go and create as much connectivity where there is travel demand. And that -- some -- in some cases that we are taking leisure or are taking it, in some cases, where -- where our origin and destination network is -- is uniquely advantaged versus other airlines, and the yields that we see in those O&Ds are materially higher than -- than what we can generate even from what business travel is there and really commodities all these.
Alison Taylor -- Chief Customer Officer
Yeah, thanks, Vasu. And thanks, Dan. We're paying really close to our corporate travel managers and their risk management team to give them all the information they need to feel comfortable to get their travelers back on the road and have to spend most of their days doing that and building confidence in travel through information and communication. We also think very close to GBTA and the other large association to provide great communication to these travel managers.
A little early to say, but as you saw, some of the surveys coming out from GBTA. They did indicate the back end of '21 to start corporate travel. Thank you.
Dan McKenzie -- Seaport Global -- Analyst
Yeah. Thanks for the -- the perspective. I guess just following up on that. I wonder if you can elaborate a little bit more on -- on travel passport initiatives? What countries are you focusing on initially for -- for adoption? And I appreciate that it's early, but is there a read on what it's going to take for these -- for countries to get a little more comfortable with this -- this idea? Maybe COVID metrics or what -- what type they want to see?
Alison Taylor -- Chief Customer Officer
Luckily, we have great partners. We don't do this alone. So working with tourism bodies, our hotel partners. We've been able to stand up very quickly in 19 soft market testing, and of course, we have our VeriFLY health wallet that provides all the documentation.
Just if you're ready to travel. You've got a ticket, you can go on. And actually, as an example, Dan, on Tuesday, we have thousand plus travelers coming back from Cancun to the U.S. Everyone checked in and boarded successfully and had their negative test.
So we've been able to facilitate this through communication with our customers and being very proactive with our notification, and calling customers directly, and working on the ground across every station led by [Inaudible] group, who's done a great job of making sure that on the ground, we're ready to help our customers.
Dan McKenzie -- Seaport Global -- Analyst
I see. Thank you. Appreciate it.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, Dan. Thanks, Alison.
Operator
Our next question will come from the line of Jamie Baker from J.P. Morgan. You may begin.
Jamie Baker -- J.P Morgan -- Analyst
Hey, good morning, everybody. Very thorough call. Most of my question has been answered. But, Derek, you disclosed you are able to achieve 2019 capacity on 10% fewer aircraft.
Would you be able to express the capacity base that would be required to get you back to 2019 ex-fuel CASM? Apologies if I missed that in your prepared remarks.
Derek Kerr -- Chief Financial Officer
Capacity base meaning area number of aircraft?
Jamie Baker -- J.P Morgan -- Analyst
No, ASMs. And -- and if 2019 is even the correct base to be using, that's just sort of become the -- the -- the industry standard at the moment. How much capacity do you have to operate to get back to 2019?
Derek Kerr -- Chief Financial Officer
All -- all we're trying to do is -- I mean, obviously, we're not back to those levels yet and we don't know when we're going to be back to those levels. All we're trying to do is acquaint to the fact that if we did get back to 2019 levels, we could do it with a significant amount fewer aircraft because we got -- which -- we don't have to add a bunch of aircraft to get to those levels. Our -- our spares are down. Our maintenance allocations are down.
The MAX has come back, which we're down in 2019. So we have a significant amount of utilization increase and gauge increase in our -- in our fleet so that we would not have -- in order for us to get to 2019 levels, the point is that we would not need anywhere near as many aircraft to get to those levels because of those things. Whether -- whether that's the -- whether that's the right point, it's a -- it's a level that we know and that we were at back at that point in time. Hopefully, some -- someday in the future, we'll be ahead of those levels.
Jamie Baker -- J.P Morgan -- Analyst
Sure. Would you have a corresponding ex-fuel CASM number that would then equate to the 2019 capacity?
Derek Kerr -- Chief Financial Officer
No, we do not have.
Jamie Baker -- J.P Morgan -- Analyst
OK.
Derek Kerr -- Chief Financial Officer
We don't have that right now. Yup.
Jamie Baker -- J.P Morgan -- Analyst
And -- and second, I came into the call, Mark and I are also curious on with the net proceeds of PSP were going to be in. And -- and I think you answered this in response to Savi's question, so is -- is the $300 million in -- in incremental labor the only thing we net out or were there any other additional operating costs?
Derek Kerr -- Chief Financial Officer
That's what you would net out.
Jamie Baker -- J.P Morgan -- Analyst
OK. All right. Thank you very much. Take care.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, Jamie.
Jamie Baker -- J.P Morgan -- Analyst
Thanks, Doug.
Operator
Our next question comes from the line of Helane Becker from Cowen. You may begin.
Helane Becker -- Cowen and Company -- Analyst
Thanks very much, operator. Hi, everybody. Thanks for the time. Doug, you've been very close to [Inaudible] and you've done a lot to get this PSP in place.
Ha -- has there been any discussion and maybe it's -- it's too early in the new administration about changes going forward once we get post-pandemic to capital controls or anything else that would ensure the industry remains solvent in the event there is another crisis?
Doug Parker -- Chairman and Chief Executive Officer
No. I'm not -- no, we certainly haven't asked for that. Nothing like that, Helane.
Helane Becker -- Cowen and Company -- Analyst
OK. That's -- that's very helpful. And then that was -- that was my main question. And then the other thing is when you look at the fleet with -- I think you said eliminating five types and down to where you are now, and having 11.5 years.
How does that compare from an ESG perspective? Like what -- what will your -- what -- if -- if your carbon goals were to be half by 2050, what would the new goals be now? Like where would you be in say 2030 or 2035? Thank you.
Doug Parker -- Chairman and Chief Executive Officer
Yeah, I'll -- I'll try, Helane. The -- the goals we already have in place are -- are -- are re -- required in things like this improvement. So you're right. This is -- this is helpful to -- younger fleet is help for the environment.
In -- in terms of -- and American have done a lot in that regard already. We already have the youngest -- slightly younger even though -- even though years go on through this. So we're proud of that. But that's -- that's a big part of our -- of our commitment to getting to carbon neutral is continuing to have -- have a modern fleet, we've done with these -- these retirements.
Helane Becker -- Cowen and Company -- Analyst
OK. That's very helpful. Thank you.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, Helane.
Operator
And our next question comes from the line of Joseph DeNardi from Stifel. You may begin.
Joseph DeNardi -- Stifel Financial Corp. -- Analyst
Thanks. Good morning. Maybe a question for Doug or Derek following up on -- on hires. Do -- do you feel comfortable from a -- a legal standpoint selling stock into this market and how quickly can you increase your I guess your -- your authorization?
Doug Parker -- Chairman and Chief Executive Officer
Yeah, Joe, kind of falls on the stuff that's referenced come in on. What -- what -- again, what has Derek has comments, we still have $118 million left on our previously announced at-the-market equity authorization. And if -- if -- if we choose to do anything more than that, we obviously need to inform our investors. But right now, that's -- that's what we have to tell you.
There's a $118 million on the ATM equity authorization. And whether or not we choose to do that or feel comfortable doing it, we can't talk about it.
Joseph DeNardi -- Stifel Financial Corp. -- Analyst
OK. And then, Vasu, can you just quantify maybe what -- what -- what gauge looks like on the other side of this relative to pre-COVID? And then if you could just walk through the -- the four geographic entities and speak to maybe the -- the structural impact to capacity based on the -- the fleet actions if -- if that makes sense? Thank you.
Vasu Raja -- Chief Revenue Officer
Yeah. The -- we -- indeed, we will be getting a material about our updating as you probably figured from -- from Derek's comments. By the time we get to December, we have the ability to produce 2019's level of capacity on about 110 fewer airplanes. The -- and the -- and that'll be a gauge increase of about 4%.
Joseph DeNardi -- Stifel Financial Corp. -- Analyst
Got it. Thank you.
Operator
Thank you. Our next question will come from the line of Andrew Didora from Bank of America. You may begin.
Andrew Didora -- Bank of America Merrill Lynch -- Analyst
Hey, good morning, everyone. My questions have -- have already been answered. But just -- just one for -- one for Derek. I know you're talking about net cash flow in from -- from capex.
Can you give us the gross aircraft capex number? How much financing you're assuming there? I'm just trying to understand the bridge to that -- to that inflow number. Thanks.
Derek Kerr -- Chief Financial Officer
Yeah. Gross -- gross aircraft capex is about with $1.1 billion and the aircraft capex for the MAX as in the NEOs. The 787s are fully financed and direct leased to us. And -- and then net on the -- that aircraft is approximately about $200 million.
So positive. So we will over finance those aircraft that are coming in. And then we have -- as -- as part of this settlement, we have some difference in our PDP's schedule that goes forward. So that's the -- the difference between the 1.2 and the 200.
Andrew Didora -- Bank of America Merrill Lynch -- Analyst
But that's perfect. Thank you.
Operator
Thank you. Our next question comes from the line of Sheila Kahyaoglu from Jefferies. You may begin.
Scott Forbes -- Jefferies -- Analyst
Hi, it's actually Scott Forbes on for Sheila. But I was wondering if you can maybe elaborate a little bit more on the fleet. I mean you removed 150 aircraft from the fleet. You're going to come out of this with the youngest fleet among the network carriers.
I mean can you talk about maybe how that plays into your planning for the recovery with route structure and how you're thinking about the competitive environment post-COVID?
Vasu Raja -- Chief Revenue Officer
Yeah, this is Vasu. Indeed, as -- as we've gathered from my remarks, we would be able to produce a similar level of capacity much more efficiently than what we could before. It doesn't necessarily mean that we'll do so. That's all going to be a function of -- of demand.
But a lot of what you see is -- is -- is really the -- the schedules that are out there flying right now. The strongest parts of our network, all of our core connecting hubs in Charlotte, Chicago, Dallas, Phoenix, Miami, Philly will continue to be that way. And indeed, with larger gauge airplanes, we can operate there much more efficiently, right? We can -- we can sca -- scale their expenses on more seats, but also by having fewer departures in there. It's more efficient and reliable product.
We would be shutting fewer and fewer departures to the airspace. The -- the biggest parts of our network is, as -- as Robert mentioned in his opening remarks, that -- that have we struggle in are really shored up through our partnerships with Alaska in the West and JetBlue with the Northeast. And through those, we anticipate the combination of those partnerships plus larger gauge airplanes and a more efficient fleet will enable us to go in and do things like take 50-seat regional jets out of those -- those markets, which are uniquely high cost but also really challenge the airspace. And so at -- at large, we can go in and provide more connectivity into the system, provide a better higher quality network for our customers, and do it in a much more efficient way than -- than what we would have done in 2019.
Rob Isom -- President
Hey, Vasu, I'll just add that every time we move one of those 50-seaters out, we're bringing in a two-class product. Obviously, with the -- a first-class section that has Wi-Fi and in-seat power as well. So it's -- it's a much more compelling offer to our -- to our customers, and we're really looking forward to.
Doug Parker -- Chairman and Chief Executive Officer
Thanks. Thanks, Scott.
Operator
Thank you. And at this time, we'd like to give the media a moment for questions. [Operator instructions] And our first question will come from the line of Mary Schlangenstein from Bloomberg News. You may begin.
Doug Parker -- Chairman and Chief Executive Officer
Hey, Mary. Mary?
Operator
Mary, your line is open.
Mary Schlangenstein -- Bloomberg -- Airlines Reporter
Sorry, I was on mute. Thank you. Hey, Doug, I know you're a little hesitant to talk about demand further out into the summer. But I'm wondering if you could talk about what you guys are seeing now in terms of spring break demand? Do you expect that that's just going to be a nonevent or do you see travel demand picking up a little bit maybe around that period?
Doug Parker -- Chairman and Chief Executive Officer
We'll let Vasu will give you that, Mary. Thanks.
Vasu Raja -- Chief Revenue Officer
Yeah. Hey, Mary, good to hear from you. I'm Vasu. And -- and look at -- what -- what makes demand forecasting so uniquely challenging in these times is that 75% of our booking curve happened inside 45 days.
So really, so much of spring break is -- is kind of a question mark right now and there's -- there's different tailwinds and headwinds for -- for what might happen with -- with demand there right now. What we have seen, as -- as --as Robert mentioned his comments, is that since there have been more restrictions on international travel, our international bookings have -- have roughly -- roughly halved in the last seven days versus the first call it two weeks of January. It remains to be seen how much that trend holds. Certainly, a lot of the -- of -- of travel partners out there are working hard to go bring testing online.
And so we'll see how -- how that goes for us. The biggest thing is to remain as limber as possible on how we plan the airline, and we'll continue to do that through the first quarter and beyond.
Mary Schlangenstein -- Bloomberg -- Airlines Reporter
Great. Thank you very much. And I had a quick follow-up. I noticed that you guys mentioned that DOJ and the attorney general of New York looking into the JetBlue Northeast U.S.
alliance. I'm wondering, there -- there have been some others filing objections to that, and -- and I'm wondering if your expectation is that you may have to -- to gear up for some kind of a second round of review by the DOT or having to go to greater efforts to -- to get that thing finally in place?
Doug Parker -- Chairman and Chief Executive Officer
Hey, thanks, Mary. We'll give you Steve Johnson.
Steve Johnson -- Executive Vice President, Corporate Affairs
Hi, Mary, how are you doing today? Let me start by saying that both the Alaskan, the JetBlue alliances that we've announced are profoundly pro-competitive and -- and kind of create enormous benefit for consumers. And -- and -- and that's why we like them, that's why we did it, and that's why we're so excited, and -- and our partners are so excited about implementing those. But as you know, the Department of Justice has over the last I guess 12 or 13 years looked really hard at all of the agreements between airlines, including all the mergers, taking a really good look at those. And that's what they're doing in connection with our JetBlue alliance.
That investigation is going to continue. My suspicion is that they're going to allow it to be implemented and see and -- and -- and take a look and determine whether the benefits that we've promised actually do materialize. And if they do, I think we'll be fine.
Vasu Raja -- Chief Revenue Officer
Hey, Mary. The -- the only thing I'd add to that is that we're working very ardently both AA and all of our partners to deliver on exactly that. We anticipate in the first quarter, we'll be rolling out some pretty comprehensive frequent-flyer and -- and productivity co-chair with customer. And in second quarter, we anticipate being able to start ramping in that new markets such as Tel Aviv and Athens, and certainly with JetBlue start the process of -- of deeper schedule integration.
Mary Schlangenstein -- Bloomberg -- Airlines Reporter
Great. Thanks very much.
Doug Parker -- Chairman and Chief Executive Officer
Thank you, Mary.
Operator
Thank you. Our next question will come from the line of Alison Sider from Wall Street Journal. You may begin.
Alison Sider -- Wall Street Journal -- Air Travel Reporter
Hi. Yeah, I was wondering -- hi. I was wondering if -- if there's been any discussion yet about what will happen after March 31 with the employees that have been recalled? If you're able to say yet whether they'll be able to stay on or if there's discussion at this point about another round of government aid?
Doug Parker -- Chairman and Chief Executive Officer
Yeah. Thanks, Ali. We -- we need -- your -- anyway. To state the obvious, April 1 is approaching and demand hasn't gotten much better by then.
So we -- we're definitely going to need to address this. And once demand starts to pick up, we -- we're -- we're already talking to our unions about things we might be able to do. But -- anyway, nothing really to report yet other than what we had hoped, which is that demand would be -- would have -- would have picked up. Maybe not so much by April, but into the summers that we would be ramping up for the summer, hasn't happened yet.
So we find ourselves with -- with April 1 approaching being concerned about this, and our unions being concerned about it. I'll work with them. I know -- I know our unions are already talking to -- to the administration and Congress about -- about this -- the -- anyway, with the current proposal to -- for stimulus to be included in there. We would -- we would obviously be supportive of that.
So anyway, that's what I know right now. Not -- not enough to tell you in definitive. But just tell you what we know, which is it's -- it's something we're going to need to address here before too long.
Alison Sider -- Wall Street Journal -- Air Travel Reporter
Thanks. And on the management side, I know you mentioned the -- just the cost savings of -- of all the reductions, the staff on the management side. But I guess do you worry at all at some point about brain drain? Is it hard to recruit new people into the airline just given the state of the industry right now?
Doug Parker -- Chairman and Chief Executive Officer
Yeah, but we're -- we're starting on -- starting on working on brain drain. We got an amazing team here. And -- and frankly, those that -- those that are here are engaged and doing an amazing work. And if anything, we find ourselves working more efficiently and better together just because there's not enough -- there's not -- not enough people to be doing inefficient things.
So I -- I feel really good about where the team is right now. We certainly have issues like all companies do in these times to make sure we're doing the right things to keep people engaged and retain -- and retain. But so far -- so far, so good. We really have an amazing human places working better together than I think we ever have.
And we're here, we can make that continue.
Alison Sider -- Wall Street Journal -- Air Travel Reporter
Thanks.
Doug Parker -- Chairman and Chief Executive Officer
Thank you, Ali.
Operator
And our next question comes from the line of Dawn Gilbertson from USA Today. You may begin.
Dawn Gilbertson -- USA Today -- Consumer Travel Reporter
Hi, good morning, everyone. Hey. Two questions. The first one is for you Doug.
Why -- I know this proposal was just floated, but I'm unclear and you're not the only one who has said this. Why you support international testing on flights but not domestic? And my second unrelated question, I'm not sure who it's for, is can anybody give any color on what you're seeing at international airports, especially in Mexico and the Caribbean in the first few days of the international testing requirements? Any problems that have cropped up? Anything you've had to do differently? Thank you very much.
Doug Parker -- Chairman and Chief Executive Officer
Yeah, I'll take the first one and give Rob the second one. I -- again, we -- we support international testing because that -- that's about getting more people to -- to be comfortable flying across borders. And we have worked with regularity on the administration to make that happen on very short. So -- and indeed, hopefully in doing so, that -- that allows the administration to get comfortable with allowing or to be more open and allowing people from New York, for example, to begin traveling to the United States at some point.
So -- anyway, that's -- we -- we work together and are supportive of that. I -- I didn't actually say that we weren't supportive of -- of doing something more expansive than that. What I said is we haven't heard it. We haven't been asked to do that.
And if we did, we -- we certainly would want to make sure it was something that wouldn't -- wouldn't restrict demand. We have seen drops in demand of course. I'm sure [Inaudible] And -- anyway, so which -- we work with the administration to see what, and if indeed, there is -- there are any -- any thoughts about doing something for having Americans fly within America. It certainly seems like it -- we'll wait and see what -- where they -- what -- if indeed there is anything there.
You have also just said it's been floated. No one has talked to us officially about doing that. If they do, we'll do our best to work with them, make sure we -- we stressed how safe it is to fly and which I know they know and they have proven that, and work to make sure that our customers feel comfortable flying. Robert.
Rob Isom -- President
Yeah, and, Dawn, thanks -- thanks for the question. Hey, the -- the biggest challenge is -- is getting word out to people that the new testing requirement has to be complied with. And to that end, we've done a terrific job of -- of getting word out through every imaginable channel. And what we found, as Alison mentioned a little bit earlier, our largest international destination these days, Cancun.
We've had on the first out of the box, no -- no no issues whatsoever. All passengers were basically boarded. So we've also done tremendous work at -- in all international locations and making sure that testing resources are available. And so yeah, we've seen some -- some customers show up with -- without the -- the necessary proof.
And we're reaccommodating them as -- as -- as required. But word getting out. And fortunately, with all the work that we've done to put the tools in place like VeriFLY, the -- the digital health passport, we're doing a pretty good job and -- and we're going to be able to handle this.
Dawn Gilbertson -- USA Today -- Consumer Travel Reporter
Thank you very much.
Doug Parker -- Chairman and Chief Executive Officer
Thanks, Dawn.
Operator
Thank you. Our next question will come from the line of Leslie Josephs from CNBC. You may begin.
Leslie Josephs -- CNBC -- Airline Reporter
Hi, good morning, everyone.
Doug Parker -- Chairman and Chief Executive Officer
Hi, Leslie.
Leslie Josephs -- CNBC -- Airline Reporter
What are your pilot needs and pilot training needs for summer of 2020. So Delta calling back 400 pilots. Do you expect them all, including the -- the 1,200 plus that were furloughed to be active by summer? And then just another question on capacity going forward with these partnerships. Do you expect American to continue to or do you know the percentage of how much American will sort of outsource some of this capacity thanks to these new partnerships?
Rob Isom -- President
So I'll try to -- to take both. So just in terms of -- of pilot. The question is how much you're flying? And so to that end, it's -- it's a -- it's a question mark out there. If demand comes back, we -- we know that over the long run, we'll have a home for -- for all -- all of our pilots.
Those -- certainly those that have been furloughed in the past. And hopefully that we'll -- we'll be able to keep everybody on -- on board. And that's just because of the -- that the pilot -- pilots and -- and retirement age, we anticipate that -- that we will be hiring pi -- pilots in the not too distant future. Now, second question was in terms of -- of that -- in terms of --
Leslie Josephs -- CNBC -- Airline Reporter
And having that not -- not flying your own metal versus.
Rob Isom -- President
Yeah, in -- in terms of -- thanks -- thanks -- thanks for that as well. The -- the relationships are not about outsourcing in any -- any way, shape or -- shape or form. It's all about better utilizing those assets we have and finding -- finding ways in the long run for -- for growth for us. And these -- these partnerships are -- are really creative in -- in that sense in that they're going to be able -- able to allow American Airlines to -- to do what it -- it does -- it does best, both domestically and internationally.
So prospects in -- in terms of the work that we do for the -- for the long run is --- is -- is very, very bright.
Doug Parker -- Chairman and Chief Executive Officer
Yeah, and, Leslie, and these are really pro -- pro-consumer. And what that means is they're going to -- they're going to generate more demand just because we can connect with each other. So we think it adds actually more -- more flying for American Airlines, lar -- more -- big airplane sets smaller airplanes, for example, in New York. Because we're -- because we're able to -- to compete better against other airlines who have larger networks in those areas than we do.
Leslie Josephs -- CNBC -- Airline Reporter
OK. And just one follow-up, do you have any expectation of how long American will be so domestic-focused versus its pre-pandemic global network?
Vasu Raja -- Chief Revenue Officer
Hey, this Vasu. And right now, a lot of what -- what you see in our -- in our asset footprint is more just we're operating where indeed there is demand. And if you go look out there in -- in nonbar schedules, so in February and March schedule, you'll see that the -- the Latin American network that we're operating is indeed in many cases larger than -- than what was there before the pandemic because that is the place where we see demand and heard Alison and Roberts comments, a place where we see a lot of testing get -- getting stood up pretty quickly itself. For those international, will -- will really be a function of coming back.
And then international bring back will be really a product of where demand is and how fast testing can get ramped up.
Leslie Josephs -- CNBC -- Airline Reporter
OK. Thank you.
Operator
Thank you. Our next question will come from the line of Tracy Rucinski from Reuters. You may begin.
Tracy Rucinski -- Reuters -- Analyst
Hi, good morning. Hi. So given the strong rise in shares this morning, are you planning an equity offering or anything to delever the balance sheet?
Doug Parker -- Chairman and Chief Executive Officer
Yeah, Tracy. We -- we said at the start of this call, we can't comment on the recent stock price movements. But we -- what we did say is that we have $118 million of authority on a previously announced after market equity authorization. So -- and -- as -- as well we might do in the future risk, we can't talk about.
Tracy Rucinski -- Reuters -- Analyst
I apologize. I'm -- I'm not setup --
Doug Parker -- Chairman and Chief Executive Officer
And that's OK.
Tracy Rucinski -- Reuters -- Analyst
OK, thanks.
Doug Parker -- Chairman and Chief Executive Officer
There's a lot going on. Thanks, Tracy.
Tracy Rucinski -- Reuters -- Analyst
Thanks.
Operator
Our next question will come from the line of David Koenig from the Associated Press. You may begin.
David Koenig -- The Associated Press -- Business Writer
Hey, good morning, everybody. At -- at the risk of may -- maybe rephrasing something that you are kind of getting at in -- in what in Mary and Dawn's questions. I wonder if you can talk about how much travel restrictions, including what we saw from the U.S. this week? How -- how the travel restrictions are changing your view about the pace of recovery this summer? And -- and then secondly, what -- what impact would you see if -- if there is a testing requirement for domestic flights?
Doug Parker -- Chairman and Chief Executive Officer
All right, David, I'll try again. So first off, travel restrictions. Again, on international, has resulted in a reduction in demand for international travel. But as -- as we've said a couple of times now, we expect that to improve as -- as -- as it becomes easier to for people to get those tests, which is happening already.
So it certainly had an impact on demand and customers need to present a -- need to present a positive test to travel. And we've seen that particularly in the short-haul international travel, things like Mexico and the Caribbean, now in the U.S.-Caribbean destination. And then it relates to any other travel restrictions and things like mask mandates. We've been do -- we've been doing mask mandates well before it was mandated by the government.
We intend to con -- continue doing that. Those are great things. We will continue to do so. If anything, we just want to make sure that the government doesn't put in place exemptions other than ones we have, which is children who are two years old.
So we're huge proponents of mask mandates. Huge proponents of what the administration is trying to accomplish and -- and that's what we've been asked to do so far. If we're asked to do more, we'll do everything to impress our desire to -- to letter write to know we have a shared objective, which is to get the pandemic behind us as fast as we can, allow our country to keep moving. In the meantime, people are -- people are driving from state to state, they're flying from state to state.
They're doing so safely. And we just want to make sure that we continue that to happen with the goal of making sure we end the pandemic as soon as possible. I know the administration shares that goal and I suspect anything we come up with will be consistent with that.
David Koenig -- The Associated Press -- Business Writer
OK, thanks. I think that's more concise and -- and you -- you -- you must have an opinion though about what impact you'd see if there is a domestic flight testing requirement?
Doug Parker -- Chairman and Chief Executive Officer
It's -- well, I have to stay on this one, David.
David Koenig -- The Associated Press -- Business Writer
OK. All right. Thank you.
Operator
Thank you. And that ends the media Q&A. I'll turn back the call to Doug Parker for any closing remarks.
Doug Parker -- Chairman and Chief Executive Officer
All right. Thank you all. Thanks very much for your interest. We really again just couldn't be prouder of our team and what they're doing.
It gives us great confidence as we forward. l know everyone's interested in how fast things will rebound. We don't know the answer to that. We know it will.
And when it does, we're going to be there ready to take care of people when they want to travel. And we're ready -- we're ready to withstand how hard it take. Everyone will be safe because of the great job Derek and the team have done and get our company's [Inaudible] position. Thanks for your time.
Operator
[Operator signoff]
Duration: 74 minutes
Call participants:
Dan Cravens -- Managing Director of Investor Relations
Doug Parker -- Chairman and Chief Executive Officer
Rob Isom -- President
Derek Kerr -- Chief Financial Officer
David Vernon -- Sanford. C.Bernstein
Savi Syth -- Raymond James -- Analyst
Mike Linenberg -- Deutsche Bank -- Analyst
Catheine O'Brien -- Goldman Sachs -- Analyst
Hunter Keay -- Wolfe Research -- Analyst
Dan McKenzie -- Seaport Global -- Analyst
Vasu Raja -- Chief Revenue Officer
Alison Taylor -- Chief Customer Officer
Jamie Baker -- J.P Morgan -- Analyst
Helane Becker -- Cowen and Company -- Analyst
Joseph DeNardi -- Stifel Financial Corp. -- Analyst
Andrew Didora -- Bank of America Merrill Lynch -- Analyst
Scott Forbes -- Jefferies -- Analyst
Mary Schlangenstein -- Bloomberg -- Airlines Reporter
Steve Johnson -- Executive Vice President, Corporate Affairs
Alison Sider -- Wall Street Journal -- Air Travel Reporter
Dawn Gilbertson -- USA Today -- Consumer Travel Reporter
Leslie Josephs -- CNBC -- Airline Reporter
Tracy Rucinski -- Reuters -- Analyst
David Koenig -- The Associated Press -- Business Writer
More AAL analysis
All earnings call transcripts
This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.
Motley Fool Transcribing has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group (NASDAQ: AAL) Q4 2020 Earnings Call Jan 28, 2021, 8:30 a.m. C.Bernstein Savi Syth -- Raymond James -- Analyst Mike Linenberg -- Deutsche Bank -- Analyst Catheine O'Brien -- Goldman Sachs -- Analyst Hunter Keay -- Wolfe Research -- Analyst Dan McKenzie -- Seaport Global -- Analyst Vasu Raja -- Chief Revenue Officer Alison Taylor -- Chief Customer Officer Jamie Baker -- J.P Morgan -- Analyst Helane Becker -- Cowen and Company -- Analyst Joseph DeNardi -- Stifel Financial Corp. -- Analyst Andrew Didora -- Bank of America Merrill Lynch -- Analyst Scott Forbes -- Jefferies -- Analyst Mary Schlangenstein -- Bloomberg -- Airlines Reporter Steve Johnson -- Executive Vice President, Corporate Affairs Alison Sider -- Wall Street Journal -- Air Travel Reporter Dawn Gilbertson -- USA Today -- Consumer Travel Reporter Leslie Josephs -- CNBC -- Airline Reporter Tracy Rucinski -- Reuters -- Analyst David Koenig -- The Associated Press -- Business Writer More AAL analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. With cleanliness and safety top of mind, last month, we were pleased to achieve STAR certification in the Global Biorisk Advisory Council for our entire fleet of aircraft and for our Admirals Club lounges.
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C.Bernstein Savi Syth -- Raymond James -- Analyst Mike Linenberg -- Deutsche Bank -- Analyst Catheine O'Brien -- Goldman Sachs -- Analyst Hunter Keay -- Wolfe Research -- Analyst Dan McKenzie -- Seaport Global -- Analyst Vasu Raja -- Chief Revenue Officer Alison Taylor -- Chief Customer Officer Jamie Baker -- J.P Morgan -- Analyst Helane Becker -- Cowen and Company -- Analyst Joseph DeNardi -- Stifel Financial Corp. -- Analyst Andrew Didora -- Bank of America Merrill Lynch -- Analyst Scott Forbes -- Jefferies -- Analyst Mary Schlangenstein -- Bloomberg -- Airlines Reporter Steve Johnson -- Executive Vice President, Corporate Affairs Alison Sider -- Wall Street Journal -- Air Travel Reporter Dawn Gilbertson -- USA Today -- Consumer Travel Reporter Leslie Josephs -- CNBC -- Airline Reporter Tracy Rucinski -- Reuters -- Analyst David Koenig -- The Associated Press -- Business Writer More AAL analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. American Airlines Group (NASDAQ: AAL) Q4 2020 Earnings Call Jan 28, 2021, 8:30 a.m. And welcome to the American Airlines Group fourth-quarter 2020earnings conference call Joining us on the call this morning, we have Doug Parker, our chairman and CEO; Robert Isom, president; and Derek Kerr, our chief financial officer.
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C.Bernstein Savi Syth -- Raymond James -- Analyst Mike Linenberg -- Deutsche Bank -- Analyst Catheine O'Brien -- Goldman Sachs -- Analyst Hunter Keay -- Wolfe Research -- Analyst Dan McKenzie -- Seaport Global -- Analyst Vasu Raja -- Chief Revenue Officer Alison Taylor -- Chief Customer Officer Jamie Baker -- J.P Morgan -- Analyst Helane Becker -- Cowen and Company -- Analyst Joseph DeNardi -- Stifel Financial Corp. -- Analyst Andrew Didora -- Bank of America Merrill Lynch -- Analyst Scott Forbes -- Jefferies -- Analyst Mary Schlangenstein -- Bloomberg -- Airlines Reporter Steve Johnson -- Executive Vice President, Corporate Affairs Alison Sider -- Wall Street Journal -- Air Travel Reporter Dawn Gilbertson -- USA Today -- Consumer Travel Reporter Leslie Josephs -- CNBC -- Airline Reporter Tracy Rucinski -- Reuters -- Analyst David Koenig -- The Associated Press -- Business Writer More AAL analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. American Airlines Group (NASDAQ: AAL) Q4 2020 Earnings Call Jan 28, 2021, 8:30 a.m. And welcome to the American Airlines Group fourth-quarter 2020earnings conference call Joining us on the call this morning, we have Doug Parker, our chairman and CEO; Robert Isom, president; and Derek Kerr, our chief financial officer.
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C.Bernstein Savi Syth -- Raymond James -- Analyst Mike Linenberg -- Deutsche Bank -- Analyst Catheine O'Brien -- Goldman Sachs -- Analyst Hunter Keay -- Wolfe Research -- Analyst Dan McKenzie -- Seaport Global -- Analyst Vasu Raja -- Chief Revenue Officer Alison Taylor -- Chief Customer Officer Jamie Baker -- J.P Morgan -- Analyst Helane Becker -- Cowen and Company -- Analyst Joseph DeNardi -- Stifel Financial Corp. -- Analyst Andrew Didora -- Bank of America Merrill Lynch -- Analyst Scott Forbes -- Jefferies -- Analyst Mary Schlangenstein -- Bloomberg -- Airlines Reporter Steve Johnson -- Executive Vice President, Corporate Affairs Alison Sider -- Wall Street Journal -- Air Travel Reporter Dawn Gilbertson -- USA Today -- Consumer Travel Reporter Leslie Josephs -- CNBC -- Airline Reporter Tracy Rucinski -- Reuters -- Analyst David Koenig -- The Associated Press -- Business Writer More AAL analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. American Airlines Group (NASDAQ: AAL) Q4 2020 Earnings Call Jan 28, 2021, 8:30 a.m. And with that, I'll open it up to questions from the analyst.
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4760.0
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2021-01-28 00:00:00 UTC
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Consumer Sector Update for 01/28/2021: EAT,AAL,FLWS
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AAL
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https://www.nasdaq.com/articles/consumer-sector-update-for-01-28-2021%3A-eataalflws-2021-01-28
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Consumer stocks were rising in Thursday trading, with the SPDR Consumer Staples Select Sector ETF climbing 0.8% while the SPDR Consumer Discretionary Select Sector ETF was posting a 1.0% advance.
In company news, Brinker International (EAT) climbed almost 10% after MKM Partners raised its price target for restaurant chain by $7 to $67 a share and also reiterating its buy rating for its stock.
American Airlines (AAL) was 8.5% higher, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Revenue plunged 64.3% year-over-year to $4.03 billion but also exceeded the $3.86 billion analyst mean.
1-800 FLOWERS.COM (FLWS) dropped 10%, giving back an earlier 8.6% gain to a best-ever $39.39 a share that followed the online flowers and gifts seller reported a $1.71 per share profit for its fiscal Q2 ended Dec. 27, up from $1.12 per share during the year-ago quarter and beating the Capital IQ consensus by $0.32 per share. Net sales grew 44.9% over the same quarter last year to $877.3 million, also exceeding the $755.5 million Street view.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (AAL) was 8.5% higher, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Consumer stocks were rising in Thursday trading, with the SPDR Consumer Staples Select Sector ETF climbing 0.8% while the SPDR Consumer Discretionary Select Sector ETF was posting a 1.0% advance. In company news, Brinker International (EAT) climbed almost 10% after MKM Partners raised its price target for restaurant chain by $7 to $67 a share and also reiterating its buy rating for its stock.
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American Airlines (AAL) was 8.5% higher, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Consumer stocks were rising in Thursday trading, with the SPDR Consumer Staples Select Sector ETF climbing 0.8% while the SPDR Consumer Discretionary Select Sector ETF was posting a 1.0% advance. 1-800 FLOWERS.COM (FLWS) dropped 10%, giving back an earlier 8.6% gain to a best-ever $39.39 a share that followed the online flowers and gifts seller reported a $1.71 per share profit for its fiscal Q2 ended Dec. 27, up from $1.12 per share during the year-ago quarter and beating the Capital IQ consensus by $0.32 per share.
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American Airlines (AAL) was 8.5% higher, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Consumer stocks were rising in Thursday trading, with the SPDR Consumer Staples Select Sector ETF climbing 0.8% while the SPDR Consumer Discretionary Select Sector ETF was posting a 1.0% advance. 1-800 FLOWERS.COM (FLWS) dropped 10%, giving back an earlier 8.6% gain to a best-ever $39.39 a share that followed the online flowers and gifts seller reported a $1.71 per share profit for its fiscal Q2 ended Dec. 27, up from $1.12 per share during the year-ago quarter and beating the Capital IQ consensus by $0.32 per share.
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American Airlines (AAL) was 8.5% higher, retreating from an initial 31% spike that followed the company Thursday reporting a non-GAAP Q4 net loss of $3.86 per share, reversing a $1.15 per share adjusted profit during the same quarter in 2019 but still beating the Capital IQ consensus expecting a $4.13 per share adjusted loss. Consumer stocks were rising in Thursday trading, with the SPDR Consumer Staples Select Sector ETF climbing 0.8% while the SPDR Consumer Discretionary Select Sector ETF was posting a 1.0% advance. In company news, Brinker International (EAT) climbed almost 10% after MKM Partners raised its price target for restaurant chain by $7 to $67 a share and also reiterating its buy rating for its stock.
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4761.0
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2021-01-28 00:00:00 UTC
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American Airlines, Southwest post record losses and signal need for more aid
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AAL
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https://www.nasdaq.com/articles/american-airlines-southwest-post-record-losses-and-signal-need-for-more-aid-2021-01-28
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By Tracy Rucinski and Sanjana Shivdas
Jan 28 (Reuters) - American Airlines Group Inc AAL.O and Southwest Airlines Co LUV.N posted their biggest-ever annual losses on Thursday and indicated a need for additional government aid as the industry continues to reel from the coronavirus pandemic.
U.S. airlines expect demand to improve this year as vaccines become more widely distributed but have warned that the strength of any rebound will depend on the pace of vaccine rollouts and the easing of travel restrictions.
JetBlue Airways JBLU.O, which also posted a quarterly loss on Thursday, said a recovery will be directly linked to a decline in COVID-19 case counts.
Still, the shares of those three airlines surged in early trading, boosted by a retail trading frenzy that pushed stock of American - which is the most heavily shorted airline stock - up as much as 32% after the carrier was mentioned on Reddit's WallStreetBets forum.
American posted an $8.9 billion annual loss, its biggest on record, though its adjusted quarterly net loss of $3.86 per share was better than analysts' expectations for a loss of $4.11 per share, according to Refinitiv data.
Total operating revenue fell to $4.03 billion from $11.31 billion but topped analysts' expectations of $3.88 billion.
Southwest reported an annual loss of $3.1 billion, its first annual loss since 1972, and said it was facing stalled demand in January and February, driven by high levels of COVID-19 cases and hospitalizations.
So far the U.S. vaccine rollout has been patchy and a string of European countries is discouraging travel and implementing more travel curbs in an attempt to contain the spread of new infections.
The United States on Tuesday began requiring negative COVID-19 tests for people entering the country from abroad, including U.S. citizens, a move that airlines said triggered a decline in bookings, even as they continue to view testing as a necessary strategy to reopen travel over the longer term.
The U.S. government has discussed mandatory COVID-19 testing for travelers on domestic flights, but American Airlines Chief Executive Doug Parker said such testing would be difficult.
MORE AID
In December, U.S. airlines received a $15 billion government aid package for payroll costs through March, the second such program since the coronavirus began pummeling demand last year.
A U.S. aviation union leader urged Congress on Thursday to extend the program for a third time, a move American's Parker told investors the company would support.
A $1.9 trillion COVID-19 relief proposal unveiled by President Joe Biden this month has $20 billion in new assistance for public transit systems, but no new money for airline payrolls.
U.S. airlines continued to burn through millions of dollars of cash every day in the fourth quarter as costs outstripped revenues, despite strong cost-cutting efforts in place for this year.
American and Southwest each ended 2020 with $14.3 billion in available liquidity. American is significantly more leveraged than its peers but said liquidity would improve to $15 billion by the end of March, reassuring investors.
Southwest has taken advantage of the crisis to add new routes, a strategy it plans to continue this year.
American, with a larger international profile, said it was exiting 19 international routes in 2021.
Both carriers are large operators of Boeing Co's BA.N 737 MAX, which was approved to fly commercially again in November after a 20-month safety ban.
American resumed passenger flights late last year and Southwest plans to fly the jets again on March 11.
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(Reporting by Sanjana Shivdas in Bengaluru and Tracy Rucinski in Palm Coast, Fla. Additional reporting by Shariq Khan, Sagarika Jaisinghan and Ankit Ajmera in Bengaluru Editing by Nick Zieminski and Matthew Lewis)
((SanjanaSitara.Shivdas@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1642; Twitter: @SanjanaShivdas;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - American Airlines Group Inc AAL.O and Southwest Airlines Co LUV.N posted their biggest-ever annual losses on Thursday and indicated a need for additional government aid as the industry continues to reel from the coronavirus pandemic. In December, U.S. airlines received a $15 billion government aid package for payroll costs through March, the second such program since the coronavirus began pummeling demand last year. A $1.9 trillion COVID-19 relief proposal unveiled by President Joe Biden this month has $20 billion in new assistance for public transit systems, but no new money for airline payrolls.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - American Airlines Group Inc AAL.O and Southwest Airlines Co LUV.N posted their biggest-ever annual losses on Thursday and indicated a need for additional government aid as the industry continues to reel from the coronavirus pandemic. In December, U.S. airlines received a $15 billion government aid package for payroll costs through March, the second such program since the coronavirus began pummeling demand last year. BREAKINGVIEWS-If only American Airlines’ stock pop helped it 'We love this stock': GameStop effect spreads as calls for probe build Bearish GameStop options contracts fly off the shelf after stock surge BUZZ-American Airlines: Jumps 50% after GameStop retail frenzy spills over BREAKINGVIEWS-Viewsroom: Short squeeze craziness, Oz in the lead BREAKINGVIEWS-Short squeezers could end up strangling themselves GameStop, other retail darlings dented after Reddit group briefly shuts doors (Reporting by Sanjana Shivdas in Bengaluru and Tracy Rucinski in Palm Coast, Fla. Additional reporting by Shariq Khan, Sagarika Jaisinghan and Ankit Ajmera in Bengaluru Editing by Nick Zieminski and Matthew Lewis) ((SanjanaSitara.Shivdas@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1642; Twitter: @SanjanaShivdas;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - American Airlines Group Inc AAL.O and Southwest Airlines Co LUV.N posted their biggest-ever annual losses on Thursday and indicated a need for additional government aid as the industry continues to reel from the coronavirus pandemic. American posted an $8.9 billion annual loss, its biggest on record, though its adjusted quarterly net loss of $3.86 per share was better than analysts' expectations for a loss of $4.11 per share, according to Refinitiv data. BREAKINGVIEWS-If only American Airlines’ stock pop helped it 'We love this stock': GameStop effect spreads as calls for probe build Bearish GameStop options contracts fly off the shelf after stock surge BUZZ-American Airlines: Jumps 50% after GameStop retail frenzy spills over BREAKINGVIEWS-Viewsroom: Short squeeze craziness, Oz in the lead BREAKINGVIEWS-Short squeezers could end up strangling themselves GameStop, other retail darlings dented after Reddit group briefly shuts doors (Reporting by Sanjana Shivdas in Bengaluru and Tracy Rucinski in Palm Coast, Fla. Additional reporting by Shariq Khan, Sagarika Jaisinghan and Ankit Ajmera in Bengaluru Editing by Nick Zieminski and Matthew Lewis) ((SanjanaSitara.Shivdas@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1642; Twitter: @SanjanaShivdas;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - American Airlines Group Inc AAL.O and Southwest Airlines Co LUV.N posted their biggest-ever annual losses on Thursday and indicated a need for additional government aid as the industry continues to reel from the coronavirus pandemic. American posted an $8.9 billion annual loss, its biggest on record, though its adjusted quarterly net loss of $3.86 per share was better than analysts' expectations for a loss of $4.11 per share, according to Refinitiv data. American and Southwest each ended 2020 with $14.3 billion in available liquidity.
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4762.0
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2021-01-28 00:00:00 UTC
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South Africa's rand rides local exporter support despite debt concerns
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AAL
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https://www.nasdaq.com/articles/south-africas-rand-rides-local-exporter-support-despite-debt-concerns-2021-01-28
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Adds latest prices, analyst figures
JOHANNESBURG, Jan 28 (Reuters) - The rand firmed on Thursday, buoyed by exporters who helped shield it from souring sentiment toward risk currencies amid fears over global coronavirus cases and concerns over South Africa's debt.
At 1545 GMT the rand ZAR=D3 was 0.85% firmer at 15.1450 per dollar compared to an open of 15.2650.
"The rand is still within this 15.05 to 15.38 range despite the risk aversion currently taking place. A testament to the local exporter supply," Standard Bank chief trader Warrick Butler said in a note.
"High real rates are a boon still. However, given that SA has one of the highest debt serving costs globally, one has to wonder just how long the rand can maintain its heady heights."
The International Monetary Fund (IMF) warned South Africa on Wednesday about its spiralling debt, stressing the urgency of fiscal consolidation.
Standard & Poor's EMEA sovereign analyst Frank Gill said the debt levels were a concern. "We don't think South Africa will be able to stabilise their debt any time soon," he said.
Bonds inched firmer, with the yield on the ZAR2030= down 0.5 basis point to 8.765%.
Stocks rose, with the Johannesburg Stock Exchange's Top-40 Index .JTOPI rup 0.76% to 58,084 points and the broader All-Share Index .JALSH climbing 0.67% to 63,207 points.
Miners led the charge, with Sibanye-Stillwater SSWJ.J, Anglo American Platinum AMSJ.J and its parent Anglo American AAL.L, which reported a rebound in production, as well as Gold Fields GFIJ.J and a host of peers topping the blue-chip index.
The stocks closed up 6%, 5.48% and 3.25% respectively, despite a slip in the gold price throughout the day as safe-haven appeal shifted to the dollar, although both gold and silver were rising before the local market closed.
Among the worst performers were retailers including Shoprite SHPJ.J, which closed down 3.27%.
Share prices across the sector have been elevated in recent days after trading statements indicated it was bouncing back from the hefty blow dealt by the coronavirus pandemic.
(Reporting by Mfuneko Toyana and Emma Rumney; Editing by Alexander Smith)
((mfuneko.toyana@thomsonreuters.com; +27117753153; Reuters Messaging: mfuneko.toyana.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Miners led the charge, with Sibanye-Stillwater SSWJ.J, Anglo American Platinum AMSJ.J and its parent Anglo American AAL.L, which reported a rebound in production, as well as Gold Fields GFIJ.J and a host of peers topping the blue-chip index. Adds latest prices, analyst figures JOHANNESBURG, Jan 28 (Reuters) - The rand firmed on Thursday, buoyed by exporters who helped shield it from souring sentiment toward risk currencies amid fears over global coronavirus cases and concerns over South Africa's debt. The International Monetary Fund (IMF) warned South Africa on Wednesday about its spiralling debt, stressing the urgency of fiscal consolidation.
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Miners led the charge, with Sibanye-Stillwater SSWJ.J, Anglo American Platinum AMSJ.J and its parent Anglo American AAL.L, which reported a rebound in production, as well as Gold Fields GFIJ.J and a host of peers topping the blue-chip index. Adds latest prices, analyst figures JOHANNESBURG, Jan 28 (Reuters) - The rand firmed on Thursday, buoyed by exporters who helped shield it from souring sentiment toward risk currencies amid fears over global coronavirus cases and concerns over South Africa's debt. A testament to the local exporter supply," Standard Bank chief trader Warrick Butler said in a note.
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Miners led the charge, with Sibanye-Stillwater SSWJ.J, Anglo American Platinum AMSJ.J and its parent Anglo American AAL.L, which reported a rebound in production, as well as Gold Fields GFIJ.J and a host of peers topping the blue-chip index. Adds latest prices, analyst figures JOHANNESBURG, Jan 28 (Reuters) - The rand firmed on Thursday, buoyed by exporters who helped shield it from souring sentiment toward risk currencies amid fears over global coronavirus cases and concerns over South Africa's debt. Stocks rose, with the Johannesburg Stock Exchange's Top-40 Index .JTOPI rup 0.76% to 58,084 points and the broader All-Share Index .JALSH climbing 0.67% to 63,207 points.
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Miners led the charge, with Sibanye-Stillwater SSWJ.J, Anglo American Platinum AMSJ.J and its parent Anglo American AAL.L, which reported a rebound in production, as well as Gold Fields GFIJ.J and a host of peers topping the blue-chip index. Adds latest prices, analyst figures JOHANNESBURG, Jan 28 (Reuters) - The rand firmed on Thursday, buoyed by exporters who helped shield it from souring sentiment toward risk currencies amid fears over global coronavirus cases and concerns over South Africa's debt. "We don't think South Africa will be able to stabilise their debt any time soon," he said.
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4763.0
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2021-01-28 00:00:00 UTC
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American Airlines Posts Lower-Than-Feared $2.2B Loss; Shares Gain 15%
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AAL
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https://www.nasdaq.com/articles/american-airlines-posts-lower-than-feared-%242.2b-loss-shares-gain-15-2021-01-28
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American Airlines posted a lower-than-feared quarterly loss of $2.2 billion as sales topped analysts’ expectations. Shares surged 15% in Thursday’s morning trading.
American Airlines (AAL) reported a net loss of $2.2 billion in the fourth quarter after posting net income of $414 million in the year-ago period. The US air carrier incurred an adjusted loss per share of $3.86, topping analysts’ expectations of a loss of $4.11 per share.
Revenue plunged 64% to $4 billion year-on-year, but exceeded the Street consensus of $3.88 billion. Furthermore, American Airlines lowered its daily cash burn rate to $30 million in the fourth quarter from almost $100 million in April 2020.
“Our fourth-quarter financial results close out the most challenging year in our company’s history,” said American Airlines CEO Doug Parker. “The American team flew more customers than any other airline in 2020. As we look to the year ahead, 2021 will be a year of recovery. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready.”
American Airlines ended the fourth quarter with about $14.3 billion of total available liquidity. The air carrier expects to end the first quarter of 2021 with about $15 billion in total available liquidity. First-quarter system capacity is projected to be down 45%, with total revenue forecasted to be down 60% to 65% year-on-year.
Shares in American Airlines have lost 38% of their value over the past year as stringent travel restrictions tied to the coronavirus pandemic have brought travel demand to an almost halt. US airlines have been incurring huge losses and implementing broad cost-cutting plans, as well as taking steps to shore up their cash buffers. (See American Airlines stock analysis on TipRanks).
That said, AAL has seen some relief over the past three months, with the stock advancing more than 50% as the rollout of a safe and effective COVID-19 vaccine spurred optimism for a recovery of the aviation industry.
Citigroup analyst Stephen Trent this week reiterated a Sell rating on the stock, citing mounting pressure on the airline’s Mexico and Caribbean flight routes due to Covid-19 requirements, as well as higher nonfuel unit costs.
Overall, the rest of the Street has a moderately bearish outlook on the stock. The Moderate Sell consensus rating breaks down into 7 Sells and 4 Holds. That’s with an average analyst price target of $13.57, implying 26% downside potential lies ahead over the coming year.
Related News:
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Levi Strauss Sinks 9% Pre-Market As 1Q Guidance Disappoints
AMC Explodes 301% After $305M Share Sale; Street Says Hold
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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That said, AAL has seen some relief over the past three months, with the stock advancing more than 50% as the rollout of a safe and effective COVID-19 vaccine spurred optimism for a recovery of the aviation industry. American Airlines (AAL) reported a net loss of $2.2 billion in the fourth quarter after posting net income of $414 million in the year-ago period. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready.” American Airlines ended the fourth quarter with about $14.3 billion of total available liquidity.
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American Airlines (AAL) reported a net loss of $2.2 billion in the fourth quarter after posting net income of $414 million in the year-ago period. That said, AAL has seen some relief over the past three months, with the stock advancing more than 50% as the rollout of a safe and effective COVID-19 vaccine spurred optimism for a recovery of the aviation industry. American Airlines posted a lower-than-feared quarterly loss of $2.2 billion as sales topped analysts’ expectations.
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American Airlines (AAL) reported a net loss of $2.2 billion in the fourth quarter after posting net income of $414 million in the year-ago period. That said, AAL has seen some relief over the past three months, with the stock advancing more than 50% as the rollout of a safe and effective COVID-19 vaccine spurred optimism for a recovery of the aviation industry. American Airlines posted a lower-than-feared quarterly loss of $2.2 billion as sales topped analysts’ expectations.
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American Airlines (AAL) reported a net loss of $2.2 billion in the fourth quarter after posting net income of $414 million in the year-ago period. That said, AAL has seen some relief over the past three months, with the stock advancing more than 50% as the rollout of a safe and effective COVID-19 vaccine spurred optimism for a recovery of the aviation industry. The US air carrier incurred an adjusted loss per share of $3.86, topping analysts’ expectations of a loss of $4.11 per share.
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4764.0
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2021-01-28 00:00:00 UTC
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Anglo American hires banks to prepare S.Africa coal spin-off
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AAL
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https://www.nasdaq.com/articles/anglo-american-hires-banks-to-prepare-s.africa-coal-spin-off-2021-01-28
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By Zandi Shabalala and Helen Reid
LONDON/JOHANNESBURG, Jan 28 (Reuters) - Anglo American AAL.L has hired RMB, Morgan Stanley and Rothschild & Co to advise on the separation and listing of its South African thermal coal assets, as it aims to cut exposure to the polluting fuel, two sources with direct knowledge said.
Anglo, listed in London and Johannesburg, is expecting to list its coal within two years, one of the sources said.
"Anglo Coal right now is following what's been announced in terms of the de-merger, but it's not like they've completely shut the door to a sale. It would just need to be at a price that is compelling enough for them to want to divert their attention," the second source said.
An outright sale of the assets would require the kind of large buyer that is hard to find for thermal coal, the sources said.
Anglo's overall market capitalisation is around $47 billion. The value of its coal assets is unclear, the sources said, as coal prices have surged in recent months and the COVID-19 pandemic has impacted previous estimates.
The company declined to comment on its advisers.
In an emailed statement it said it was working on the process and would "provide a further update in due course when we have clarity on timing and the exit mechanism".
RMB, Morgan Stanley and Rothschild & Co declined to comment.
The diversified miner said in May it preferred separating and listing its thermal coal operations on the Johannesburg Stock Exchange. Reuters reported the miner was still considering a sale.
For years, coal assets were seen as an easy way to generate cash and selling them was always sensitive in South Africa where they employ many people and provide for most of the country's power needs.
But since the 2015 Paris climate accord, pressure has steadily mounted on companies to reduce exposure to the most polluting fossil fuel.
Anglo has already sold a large portion of its South African and Australian coal assets, halving its production of thermal coal since 2015. In 2019, its South African coal assets made a $5 million loss and produced 27 million tonnes.
Glencore's GLEN.L outgoing CEO Ivan Glasenberg has also kept the door open for a possible spinoff of its thermal coal assets.
Coal can still be profitable, however, complicating efforts to agree the price of any sale.
Higher demand because of cold weather and rising gas prices have driven coal prices higher.
(Reporting by Zandi Shabalala in London and Helen Reid in Johannesburg; Editing by Veronica Brown and Barbara Lewis)
((zandi.shabalala@tr.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Zandi Shabalala and Helen Reid LONDON/JOHANNESBURG, Jan 28 (Reuters) - Anglo American AAL.L has hired RMB, Morgan Stanley and Rothschild & Co to advise on the separation and listing of its South African thermal coal assets, as it aims to cut exposure to the polluting fuel, two sources with direct knowledge said. For years, coal assets were seen as an easy way to generate cash and selling them was always sensitive in South Africa where they employ many people and provide for most of the country's power needs. But since the 2015 Paris climate accord, pressure has steadily mounted on companies to reduce exposure to the most polluting fossil fuel.
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By Zandi Shabalala and Helen Reid LONDON/JOHANNESBURG, Jan 28 (Reuters) - Anglo American AAL.L has hired RMB, Morgan Stanley and Rothschild & Co to advise on the separation and listing of its South African thermal coal assets, as it aims to cut exposure to the polluting fuel, two sources with direct knowledge said. RMB, Morgan Stanley and Rothschild & Co declined to comment. (Reporting by Zandi Shabalala in London and Helen Reid in Johannesburg; Editing by Veronica Brown and Barbara Lewis) ((zandi.shabalala@tr.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Zandi Shabalala and Helen Reid LONDON/JOHANNESBURG, Jan 28 (Reuters) - Anglo American AAL.L has hired RMB, Morgan Stanley and Rothschild & Co to advise on the separation and listing of its South African thermal coal assets, as it aims to cut exposure to the polluting fuel, two sources with direct knowledge said. The value of its coal assets is unclear, the sources said, as coal prices have surged in recent months and the COVID-19 pandemic has impacted previous estimates. Anglo has already sold a large portion of its South African and Australian coal assets, halving its production of thermal coal since 2015.
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By Zandi Shabalala and Helen Reid LONDON/JOHANNESBURG, Jan 28 (Reuters) - Anglo American AAL.L has hired RMB, Morgan Stanley and Rothschild & Co to advise on the separation and listing of its South African thermal coal assets, as it aims to cut exposure to the polluting fuel, two sources with direct knowledge said. It would just need to be at a price that is compelling enough for them to want to divert their attention," the second source said. Anglo has already sold a large portion of its South African and Australian coal assets, halving its production of thermal coal since 2015.
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4765.0
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2021-01-28 00:00:00 UTC
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American Airlines' quarterly loss better than expected, shares jump
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AAL
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https://www.nasdaq.com/articles/american-airlines-quarterly-loss-better-than-expected-shares-jump-2021-01-28
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By Tracy Rucinski and Sanjana Shivdas
Jan 28 (Reuters) - Shares in American Airlines Group Inc AAL.O, the most shorted U.S. carrier, surged 60% in premarket trading after it was mentioned on Reddit's WallStreetBets forum and it posted a slimmer-than-expected quarterly loss on Thursday.
American joined rival Delta Air Lines DAL.N in calling 2021 a year of recovery for an industry that has been ravaged by the coronavirus pandemic.
"As we look to the year ahead, 2021 will be a year of recovery. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready," American Airlines Chief Executive Doug Parker said.
American reported a net loss of $2.18 billion, or $3.81 per share, for the fourth quarter, compared with a profit of $414 million, or 95 cents per share, a year earlier.
On an adjusted basis, the company lost $3.86 per share. Analysts on average expected the company to lose $4.11 per share, according to Refinitiv data.
Total operating revenue fell to $4.03 billion from $11.31 billion but topped analysts' expectations of $3.88 billion.
The carrier reported an annual loss of $8.9 billion, its biggest on record.
"We believe the (stock) move is due to the de-risking going on in the market and American remains one of the most consensus short airlines in our coverage universe," Cowen analyst Helane Becker said.
"It's hard to say when the market will look at the company's fundamentals, but we believe American could take this opportunity to de-lever the balance sheet with an equity offering," she added.
Airlines are hoping that sentiment will improve this year as COVID-19 vaccines are more widely distributed. However, new strains of the virus have triggered tighter rules for international travel in countries including the United States.
American Airlines ended the fourth quarter with about $14.3 billion in available liquidity.
(Reporting by Sanjana Shivdas in Bengaluru and Tracy Rucinski in Palm Coast, Florida; Additional reporting by Shariq Khan; Editing by Maju Samuel, Steve Orlofsky and Nick Zieminski)
((SanjanaSitara.Shivdas@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 1642; Twitter: @SanjanaShivdas;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - Shares in American Airlines Group Inc AAL.O, the most shorted U.S. carrier, surged 60% in premarket trading after it was mentioned on Reddit's WallStreetBets forum and it posted a slimmer-than-expected quarterly loss on Thursday. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready," American Airlines Chief Executive Doug Parker said. "We believe the (stock) move is due to the de-risking going on in the market and American remains one of the most consensus short airlines in our coverage universe," Cowen analyst Helane Becker said.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - Shares in American Airlines Group Inc AAL.O, the most shorted U.S. carrier, surged 60% in premarket trading after it was mentioned on Reddit's WallStreetBets forum and it posted a slimmer-than-expected quarterly loss on Thursday. American reported a net loss of $2.18 billion, or $3.81 per share, for the fourth quarter, compared with a profit of $414 million, or 95 cents per share, a year earlier. Total operating revenue fell to $4.03 billion from $11.31 billion but topped analysts' expectations of $3.88 billion.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - Shares in American Airlines Group Inc AAL.O, the most shorted U.S. carrier, surged 60% in premarket trading after it was mentioned on Reddit's WallStreetBets forum and it posted a slimmer-than-expected quarterly loss on Thursday. American reported a net loss of $2.18 billion, or $3.81 per share, for the fourth quarter, compared with a profit of $414 million, or 95 cents per share, a year earlier. Total operating revenue fell to $4.03 billion from $11.31 billion but topped analysts' expectations of $3.88 billion.
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By Tracy Rucinski and Sanjana Shivdas Jan 28 (Reuters) - Shares in American Airlines Group Inc AAL.O, the most shorted U.S. carrier, surged 60% in premarket trading after it was mentioned on Reddit's WallStreetBets forum and it posted a slimmer-than-expected quarterly loss on Thursday. "As we look to the year ahead, 2021 will be a year of recovery. American reported a net loss of $2.18 billion, or $3.81 per share, for the fourth quarter, compared with a profit of $414 million, or 95 cents per share, a year earlier.
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4766.0
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2021-01-28 00:00:00 UTC
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Why Airlines Shares Are Gaining Ground Today
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AAL
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https://www.nasdaq.com/articles/why-airlines-shares-are-gaining-ground-today-2021-01-28
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nan
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What happened
It is airline earnings season, and while 2020 fourth-quarter results were as dismal as expected, the companies are relatively optimistic about what's to come. That's helping the sector gain altitude on Thursday, a good day for broader markets as well.
Shares of American Airlines Group (NASDAQ: AAL) are leading the charge, up as much as 31% earlier in the day before falling back. American's push appears to be driven by factors unrelated to the airline's results. Shares of Hawaiian Holdings (NASDAQ: HA), Delta Air Lines (NYSE: DAL), Southwest Airlines (NYSE: LUV), United Airlines Holdings (NASDAQ: UAL), Spirit Airlines (NYSE: SAVE), and JetBlue Airways (NASDAQ: JBLU) all joined in on the action, each up at least 5% at one point on Thursday.
So what
The airline industry was among the sectors hit hardest by the pandemic, with demand for travel all but evaporating last spring and losses continuing through the rest of the year. The fourth-quarter results reflected the issues the companies face, with investors digesting results from three companies on Thursday.
Southwest lost $1.29 per share in the quarter on revenue of $2.01 billion, reporting its first annual net loss since 1972. Revenue for the quarter was down 65% year over year.
American lost $3.86 per share on revenue of $4 billion, down 64% from fourth quarter 2019.
JetBlue lost $1.53 per share on revenue of $661 million, a revenue drop of nearly 68%.
Hawaiian posted similar numbers on Tuesday, as did United and Delta earlier in the month.
Image source: Getty Images.
But investors were prepared for the losses. What they are focused on is the outlook for what is ahead. And while no airline sees a quick recovery, the consistent commentary coming out of post-earnings calls is that as the COVID-19 vaccine is rolled out there are expectations that demand will increase in the months to come.
American CEO Doug Parker called 2021 "a year of recovery," saying, "while we don't know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready." JetBlue CEO Robin Hayes said, "I could not be more confident in our future."
If anything, Southwest Airlines, which has recovered better than most airline stocks, was the most cautious in its commentary. CEO Gary Kelly said, "while we hope to achieve cash burn break even in 2021, it is wholly dependent upon a substantial rebound in passenger traffic and revenue, and it is difficult to predict the timing of such a rebound."
Now what
The airlines have plenty of cash to wait out a recovery. Unfortunately, they are going to need it.
Kelly at Southwest has the advantage of heading one of the airlines with the most secure footing, and can afford to take a conservative outlook. There is still reason to hope that pent-up vacation demand will be unleashed by summer as the vaccine rollout progresses, but so far there is no clear evidence to suggest it is definitely happening.
Business and international travel, which tends to be more lucrative and which airlines like American, Delta, and United in particular rely on to boost results, will likely not come back until 2022 at the earliest.
For those who want to buy in and ride out the turbulence, stick with top names like Southwest and Delta that are best positioned for a slow recovery. Spirit, thanks to its industry-low costs and focus on leisure traffic, is an intriguing option if we do see bookings pick up ahead of the summer season.
Earnings season so far has only confirmed what we assumed to be true about the businesses in 2020, with no real clear answers about what 2021 will look like. That's not ideal, but it could be worse, and airlines are gaining ground on Thursday as a result.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of American Airlines Group (NASDAQ: AAL) are leading the charge, up as much as 31% earlier in the day before falling back. American CEO Doug Parker called 2021 "a year of recovery," saying, "while we don't know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready." Business and international travel, which tends to be more lucrative and which airlines like American, Delta, and United in particular rely on to boost results, will likely not come back until 2022 at the earliest.
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Shares of American Airlines Group (NASDAQ: AAL) are leading the charge, up as much as 31% earlier in the day before falling back. Shares of Hawaiian Holdings (NASDAQ: HA), Delta Air Lines (NYSE: DAL), Southwest Airlines (NYSE: LUV), United Airlines Holdings (NASDAQ: UAL), Spirit Airlines (NYSE: SAVE), and JetBlue Airways (NASDAQ: JBLU) all joined in on the action, each up at least 5% at one point on Thursday. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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Shares of American Airlines Group (NASDAQ: AAL) are leading the charge, up as much as 31% earlier in the day before falling back. Shares of Hawaiian Holdings (NASDAQ: HA), Delta Air Lines (NYSE: DAL), Southwest Airlines (NYSE: LUV), United Airlines Holdings (NASDAQ: UAL), Spirit Airlines (NYSE: SAVE), and JetBlue Airways (NASDAQ: JBLU) all joined in on the action, each up at least 5% at one point on Thursday. If anything, Southwest Airlines, which has recovered better than most airline stocks, was the most cautious in its commentary.
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Shares of American Airlines Group (NASDAQ: AAL) are leading the charge, up as much as 31% earlier in the day before falling back. The fourth-quarter results reflected the issues the companies face, with investors digesting results from three companies on Thursday. What they are focused on is the outlook for what is ahead.
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4767.0
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2021-01-28 00:00:00 UTC
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US STOCKS-Wall St rises on big-tech strength, shrugs off bleak data
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AAL
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https://www.nasdaq.com/articles/us-stocks-wall-st-rises-on-big-tech-strength-shrugs-off-bleak-data-2021-01-28
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U.S. economy contracts in 2020; worst performance since 1946
Tesla slips after disappointing results
American Airlines joins retail trading frenzy
Indexes up: Dow 1.10%, S&P 1.05%, Nasdaq 0.70%
Updates prices to open
By Devik Jain and Shreyashi Sanyal
Jan 28 (Reuters) - Wall Street's main indexes rose on Thursday, as a reversal of declines in mega-cap technology stocks helped investors look past data which showed another sharp contraction in the U.S. economy.
Heavyweights including Microsoft Corp MSFT.O, Facebook Inc FB.O, Netflix Inc NFLX.O and Alphabet Inc GOOGL.O rose in early trading, supporting the tech-heavy Nasdaq index .IXIC.
With the quarterly reporting season in full swing, market participants started to question whether companies including Apple Inc AAPL.O, Facebook and Tesla Inc TSLA.O could justify their premium valuations.
"Investors are digesting earnings that came out overnight and this morning, and taking a look at the fundamentals of what's going on in specific companies, as well as any outlook that can be provided to try to justify valuations," said Brian Vendig, managing executive at MJP Wealth Advisors in Westport, Connecticut.
Apple reported holiday-quarter sales and profit that beat Wall Street expectations, however, shares of the iPhone maker fell 1.9%.
Facebook rose 2.3% after soundly beating quarterly revenue estimates, but it warned Apple's impending privacy changes could hurt revenue by interfering with ad targeting.
Tesla shed 4.7% after the electric-car maker reported disappointing fourth-quarter results and failed to provide a clear target for 2021 vehicle deliveries.
Data showed the U.S. economy contracted at its sharpest pace since World War Two in 2020 as COVID-19 ravaged services businesses such as restaurants and airlines.
A separate report showed 847,000 more people likely filed jobless claims last week, strengthening views of a persistent labor market weakness.
"This is a market which thinks about what the economy might look like six months from now ... and I think this is a time when the near-term numbers are of very little consequence to most investors," said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
Concerns about slowing momentum in economic recovery due to rising coronavirus cases, heightened stock market valuations, and uneven distribution of vaccine rollouts have kept investors on edge about a pullback and increase in volatility in the near-term.
American Airlines Group Inc AAL.O surged 26.1%, becoming the latest stock to lead bumper gains for a series of social-media hyped stocks, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets.
At 9:52 a.m. ET the Dow Jones Industrial Average .DJI was up 334.78 points, or 1.10%, at 30,637.95, the S&P 500 .SPX was up 39.24 points, or 1.05%, at 3,790.01, and the Nasdaq Composite .IXIC was up 93.42 points, or 0.70%, at 13,364.01.
Comcast Corp CMCSA.O added 3.5% after it reported better-than-expected fourth-quarter revenue, as broadband demand continued to offset pandemic-related weakness in its theme park and filmed entertainment businesses.
Advancing issues outnumbered decliners for a 3.61-to-1 ratio on the NYSE and a 2.39-to-1 ratio on the Nasdaq.
The S&P index recorded eight new 52-week highs and no new low, while the Nasdaq recorded 47 new highs and three new lows.
(Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta)
((Devik.Jain@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2062))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group Inc AAL.O surged 26.1%, becoming the latest stock to lead bumper gains for a series of social-media hyped stocks, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Weekly jobless claims dip, but still remain high U.S. economy contracts in 2020; worst performance since 1946 Tesla slips after disappointing results American Airlines joins retail trading frenzy Indexes up: Dow 1.10%, S&P 1.05%, Nasdaq 0.70% Updates prices to open By Devik Jain and Shreyashi Sanyal Jan 28 (Reuters) - Wall Street's main indexes rose on Thursday, as a reversal of declines in mega-cap technology stocks helped investors look past data which showed another sharp contraction in the U.S. economy. "Investors are digesting earnings that came out overnight and this morning, and taking a look at the fundamentals of what's going on in specific companies, as well as any outlook that can be provided to try to justify valuations," said Brian Vendig, managing executive at MJP Wealth Advisors in Westport, Connecticut.
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American Airlines Group Inc AAL.O surged 26.1%, becoming the latest stock to lead bumper gains for a series of social-media hyped stocks, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Weekly jobless claims dip, but still remain high U.S. economy contracts in 2020; worst performance since 1946 Tesla slips after disappointing results American Airlines joins retail trading frenzy Indexes up: Dow 1.10%, S&P 1.05%, Nasdaq 0.70% Updates prices to open By Devik Jain and Shreyashi Sanyal Jan 28 (Reuters) - Wall Street's main indexes rose on Thursday, as a reversal of declines in mega-cap technology stocks helped investors look past data which showed another sharp contraction in the U.S. economy. With the quarterly reporting season in full swing, market participants started to question whether companies including Apple Inc AAPL.O, Facebook and Tesla Inc TSLA.O could justify their premium valuations.
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American Airlines Group Inc AAL.O surged 26.1%, becoming the latest stock to lead bumper gains for a series of social-media hyped stocks, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Weekly jobless claims dip, but still remain high U.S. economy contracts in 2020; worst performance since 1946 Tesla slips after disappointing results American Airlines joins retail trading frenzy Indexes up: Dow 1.10%, S&P 1.05%, Nasdaq 0.70% Updates prices to open By Devik Jain and Shreyashi Sanyal Jan 28 (Reuters) - Wall Street's main indexes rose on Thursday, as a reversal of declines in mega-cap technology stocks helped investors look past data which showed another sharp contraction in the U.S. economy. With the quarterly reporting season in full swing, market participants started to question whether companies including Apple Inc AAPL.O, Facebook and Tesla Inc TSLA.O could justify their premium valuations.
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American Airlines Group Inc AAL.O surged 26.1%, becoming the latest stock to lead bumper gains for a series of social-media hyped stocks, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets. For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window Weekly jobless claims dip, but still remain high U.S. economy contracts in 2020; worst performance since 1946 Tesla slips after disappointing results American Airlines joins retail trading frenzy Indexes up: Dow 1.10%, S&P 1.05%, Nasdaq 0.70% Updates prices to open By Devik Jain and Shreyashi Sanyal Jan 28 (Reuters) - Wall Street's main indexes rose on Thursday, as a reversal of declines in mega-cap technology stocks helped investors look past data which showed another sharp contraction in the U.S. economy. With the quarterly reporting season in full swing, market participants started to question whether companies including Apple Inc AAPL.O, Facebook and Tesla Inc TSLA.O could justify their premium valuations.
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4768.0
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2021-01-28 00:00:00 UTC
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American Airlines joins GameStop trading frenzy as calls for probe build
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AAL
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https://www.nasdaq.com/articles/american-airlines-joins-gamestop-trading-frenzy-as-calls-for-probe-build-2021-01-28
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nan
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nan
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By Sagarika Jaisinghani and Shriya Ramakrishnan
Jan 28 (Reuters) - An almost 60% surge in shares of American Airlines led stellar gains for a series of social-media hyped stocks on Thursday, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets.
GameStop GME.N, the video game chain whose 1,700% rally has been at the heart of the slugfest in the past week, retreated after initially adding another 37% in early trading.
On Reddit thread WallStreetBets, where calls to buy stocks have helped drive the extraordinary moves, some of its more than 4 million members reported trading platform Robinhood was now preventing investors from buying new shares in GameStop and other of the companies.
Robinhood, one of the biggest of the easy access apps that has spurred the development of a huge online community of amateur traders, did not immediately respond to requests for comment.
Shares in American Airlines soared as much as 60%.
"It does appear that it (American Airlines) may be getting caught up in this day trading frenzy," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.
The dramatic jumps in the stock price of companies including GameStop, BlackBerry Ltd BB.N and AMC Corp AMC.N drew more calls for regulatory scrutiny and action from commentators.
"In terms of short interest being monitored, the U.S. markets are probably the most transparent, but there's always room for improvement," former SEC chairman Jay Clayton told CNBC.
In Australia, previously immune to the trend, heavily shorted shares including Webjet WEB.AX and Tassal Group TGR.AX, climbed more than 5% even as Sydney's benchmark ASX 200 index .AXJO fell 2%. .AX
Trading in European share markets was subdued, with some of this week's high-flyers including Evotec EVTG.DE and Varta VAR1.DE nearly flat.
GAME ON
The short squeeze - where traders have to abandon loss-making "short" bets on a stock falling because it has instead risen - fueled a 2% slide in New York's S&P 500 .SPX on Wednesday as investors sold other assets to cover their losses.
Short-sellers are sitting on estimated losses of $71 billion from their positions in U.S. companies so far this year, data from financial data analytics firm Ortex showed.
Futures tracking the main New York index were down another 0.3% on Thursday as Reddit discussion threads again hummed with chatter about a number of stocks. .N
In one discussion, thousands of participants responded "We love this stock" to a post that called for more buying of GameStop and cast retail traders as Iron Man against a hedge fund Thanos in a nod to the superhero movie "Avengers: Endgame".
The war began last week when famed hedge fund short seller Andrew Left of Citron Capital bet against GameStop and was met with a barrage of retail traders betting the other way. He said on Wednesday he had abandoned the bet.
Regarded by market professionals as "dumb money", the pack of traders, some of them former bankers working for themselves, has become an increasingly powerful force worth 20% of equity orders last year, data from Swiss bank UBS showed.
The only-way-is-up nature of stock markets over the past decade, fueled by a constant flow of newly created money from major central banks, has also made it less risky to bet on shares rising.
The U.S. Federal Reserve kept those taps firmly open at its latest meeting on Wednesday.
This week's turmoil caught the attention of the White House, with President Joe Biden's economic team - including Treasury Secretary Janet Yellen on her first full day on the job on Wednesday - "monitoring the situation."
Massachusetts state regulator William Galvin called on NYSE to suspend trading in GameStop for 30 days to allow a cooling-off period.
"The prospect of intervention here is clearly high, but this will just galvanize the (WallStreetBets) community as it just brings home the feeling of inequality in financial markets," said Chris Weston, head of research at broker Pepperstone in Melbourne.
"It's fine to prop up zombie companies through Fed actions but if retail follows a path that greatly distorts asset prices by targeting short sellers, then this gets shut down."
EXPLAINER-Why regulators may scrutinize GameStop's Reddit-driven retail stock surge
TIMELINE-GameStop's 1,600% surge in retail investor vs hedge fund battle
BREAKINGVIEWS-Short squeezers could end up strangling themselves
The big short: GameStop effect puts global bets worth billions at risk
GameStop surge leaves U.S.-based mutual funds and ETFs behind
Europe's top shorted stocks soar on GameStop contagion
U.S. state regulator says GameStop trading could be 'systemically wrong' - Barron's
Bearish GameStop options contracts fly off the shelf after stock surge
Hedge fund Melvin Capital has closed GameStop position -spokesman
BlackRock may have raked in $2.4 bln on GameStop's retail-driven stock frenzy
QUOTES-No let up in short squeeze, retail frenzy forces funds to cover
GRAPHIC: GameStock surge timelinehttps://tmsnrt.rs/2KSQYX3
GRAPHIC: The short squeezehttps://tmsnrt.rs/3t1OlU8
EXPLAINER-How retail traders squeezed Wall Street for bets against GameStop
Retail trading frenzy, reflation trade drive smallcap stocks higherhttps://tmsnrt.rs/2Ylef7l
(Reporting by Sagarika Jaisinghani, Shriya Ramakrishnan, Medha Singh, Ismail Shakil and Sruthi Shankar in Bengaluru, Saqib Iqbal Ahmed and April Joyner in New York; and Thyagaraju Adinarayan in London Writing by Patrick Graham; Editing by Saumyadeb Chakrabarty)
((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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.N In one discussion, thousands of participants responded "We love this stock" to a post that called for more buying of GameStop and cast retail traders as Iron Man against a hedge fund Thanos in a nod to the superhero movie "Avengers: Endgame". Regarded by market professionals as "dumb money", the pack of traders, some of them former bankers working for themselves, has become an increasingly powerful force worth 20% of equity orders last year, data from Swiss bank UBS showed. This week's turmoil caught the attention of the White House, with President Joe Biden's economic team - including Treasury Secretary Janet Yellen on her first full day on the job on Wednesday - "monitoring the situation."
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On Reddit thread WallStreetBets, where calls to buy stocks have helped drive the extraordinary moves, some of its more than 4 million members reported trading platform Robinhood was now preventing investors from buying new shares in GameStop and other of the companies. Short-sellers are sitting on estimated losses of $71 billion from their positions in U.S. companies so far this year, data from financial data analytics firm Ortex showed. EXPLAINER-Why regulators may scrutinize GameStop's Reddit-driven retail stock surge TIMELINE-GameStop's 1,600% surge in retail investor vs hedge fund battle BREAKINGVIEWS-Short squeezers could end up strangling themselves The big short: GameStop effect puts global bets worth billions at risk GameStop surge leaves U.S.-based mutual funds and ETFs behind Europe's top shorted stocks soar on GameStop contagion U.S. state regulator says GameStop trading could be 'systemically wrong' - Barron's Bearish GameStop options contracts fly off the shelf after stock surge Hedge fund Melvin Capital has closed GameStop position -spokesman BlackRock may have raked in $2.4 bln on GameStop's retail-driven stock frenzy QUOTES-No let up in short squeeze, retail frenzy forces funds to cover GRAPHIC: GameStock surge timelinehttps://tmsnrt.rs/2KSQYX3 GRAPHIC: The short squeezehttps://tmsnrt.rs/3t1OlU8 EXPLAINER-How retail traders squeezed Wall Street for bets against GameStop Retail trading frenzy, reflation trade drive smallcap stocks higherhttps://tmsnrt.rs/2Ylef7l (Reporting by Sagarika Jaisinghani, Shriya Ramakrishnan, Medha Singh, Ismail Shakil and Sruthi Shankar in Bengaluru, Saqib Iqbal Ahmed and April Joyner in New York; and Thyagaraju Adinarayan in London Writing by Patrick Graham; Editing by Saumyadeb Chakrabarty) ((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Sagarika Jaisinghani and Shriya Ramakrishnan Jan 28 (Reuters) - An almost 60% surge in shares of American Airlines led stellar gains for a series of social-media hyped stocks on Thursday, broadening a battle between small-time traders and major Wall Street institutions that has shaken U.S. and European stock markets. The short squeeze - where traders have to abandon loss-making "short" bets on a stock falling because it has instead risen - fueled a 2% slide in New York's S&P 500 .SPX on Wednesday as investors sold other assets to cover their losses. EXPLAINER-Why regulators may scrutinize GameStop's Reddit-driven retail stock surge TIMELINE-GameStop's 1,600% surge in retail investor vs hedge fund battle BREAKINGVIEWS-Short squeezers could end up strangling themselves The big short: GameStop effect puts global bets worth billions at risk GameStop surge leaves U.S.-based mutual funds and ETFs behind Europe's top shorted stocks soar on GameStop contagion U.S. state regulator says GameStop trading could be 'systemically wrong' - Barron's Bearish GameStop options contracts fly off the shelf after stock surge Hedge fund Melvin Capital has closed GameStop position -spokesman BlackRock may have raked in $2.4 bln on GameStop's retail-driven stock frenzy QUOTES-No let up in short squeeze, retail frenzy forces funds to cover GRAPHIC: GameStock surge timelinehttps://tmsnrt.rs/2KSQYX3 GRAPHIC: The short squeezehttps://tmsnrt.rs/3t1OlU8 EXPLAINER-How retail traders squeezed Wall Street for bets against GameStop Retail trading frenzy, reflation trade drive smallcap stocks higherhttps://tmsnrt.rs/2Ylef7l (Reporting by Sagarika Jaisinghani, Shriya Ramakrishnan, Medha Singh, Ismail Shakil and Sruthi Shankar in Bengaluru, Saqib Iqbal Ahmed and April Joyner in New York; and Thyagaraju Adinarayan in London Writing by Patrick Graham; Editing by Saumyadeb Chakrabarty) ((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The war began last week when famed hedge fund short seller Andrew Left of Citron Capital bet against GameStop and was met with a barrage of retail traders betting the other way. Regarded by market professionals as "dumb money", the pack of traders, some of them former bankers working for themselves, has become an increasingly powerful force worth 20% of equity orders last year, data from Swiss bank UBS showed. EXPLAINER-Why regulators may scrutinize GameStop's Reddit-driven retail stock surge TIMELINE-GameStop's 1,600% surge in retail investor vs hedge fund battle BREAKINGVIEWS-Short squeezers could end up strangling themselves The big short: GameStop effect puts global bets worth billions at risk GameStop surge leaves U.S.-based mutual funds and ETFs behind Europe's top shorted stocks soar on GameStop contagion U.S. state regulator says GameStop trading could be 'systemically wrong' - Barron's Bearish GameStop options contracts fly off the shelf after stock surge Hedge fund Melvin Capital has closed GameStop position -spokesman BlackRock may have raked in $2.4 bln on GameStop's retail-driven stock frenzy QUOTES-No let up in short squeeze, retail frenzy forces funds to cover GRAPHIC: GameStock surge timelinehttps://tmsnrt.rs/2KSQYX3 GRAPHIC: The short squeezehttps://tmsnrt.rs/3t1OlU8 EXPLAINER-How retail traders squeezed Wall Street for bets against GameStop Retail trading frenzy, reflation trade drive smallcap stocks higherhttps://tmsnrt.rs/2Ylef7l (Reporting by Sagarika Jaisinghani, Shriya Ramakrishnan, Medha Singh, Ismail Shakil and Sruthi Shankar in Bengaluru, Saqib Iqbal Ahmed and April Joyner in New York; and Thyagaraju Adinarayan in London Writing by Patrick Graham; Editing by Saumyadeb Chakrabarty) ((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4769.0
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2021-01-28 00:00:00 UTC
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Pre-Market Most Active for Jan 28, 2021 : NOK, AAL, AMC, BB, EXPR, CCL, GME, SQQQ, AAPL, UAL, JBLU, QQQ
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AAL
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https://www.nasdaq.com/articles/pre-market-most-active-for-jan-28-2021-%3A-nok-aal-amc-bb-expr-ccl-gme-sqqq-aapl-ual-jblu
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nan
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nan
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The NASDAQ 100 Pre-Market Indicator is down -64.35 to 13,048.3. The total Pre-Market volume is currently 96,927,325 shares traded.
The following are the most active stocks for the pre-market session:
Nokia Corporation (NOK) is -1.02 at $5.53, with 112,353,402 shares traded.NOK is scheduled to provide an earnings report on 2/4/2021, for the fiscal quarter ending Dec2020. The consensus earnings per share forecast is 0.12 per share, which represents a 17 percent increase over the EPS one Year Ago
American Airlines Group, Inc. (AAL) is +6.39 at $22.95, with 57,877,936 shares traded. Business Wire Reports: JetBlue and American Airlines Advance Strategic Alliance Following Regulatory Review
AMC Entertainment Holdings, Inc. (AMC) is -4.24 at $15.66, with 51,924,338 shares traded., following a 52-week high recorded in prior regular session.
BlackBerry Limited (BB) is -2.71 at $22.39, with 8,616,941 shares traded., following a 52-week high recorded in prior regular session.
Express, Inc. (EXPR) is -0.25 at $9.30, with 8,187,348 shares traded., following a 52-week high recorded in prior regular session.
Carnival Corporation (CCL) is +1.69 at $20.67, with 6,545,653 shares traded. CCL's current last sale is 121.59% of the target price of $17.
Gamestop Corporation (GME) is +98.49 at $446.00, with 4,514,141 shares traded., following a 52-week high recorded in prior regular session.
ProShares UltraPro Short QQQ (SQQQ) is +0.38 at $14.45, with 2,755,708 shares traded. This represents a 12.8% increase from its 52 Week Low.
Apple Inc. (AAPL) is -3.71 at $138.35, with 2,587,198 shares traded. As reported by Zacks, the current mean recommendation for AAPL is in the "buy range".
United Airlines Holdings, Inc. (UAL) is +2.34 at $43.25, with 1,964,034 shares traded. Over the last four weeks they have had 3 up revisions for the earnings forecast, for the fiscal quarter ending Sep 2021. The consensus EPS forecast is $-0.09. UAL's current last sale is 94.02% of the target price of $46.
JetBlue Airways Corporation (JBLU) is +1 at $15.68, with 1,291,393 shares traded. PR Newswire Reports: JetBlue Selects ASAPP Artificial Intelligence Platform for Customer Experience Transformation
Invesco QQQ Trust, Series 1 (QQQ) is -2.61 at $316.82, with 1,236,365 shares traded. This represents a 92.09% increase from its 52 Week Low.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group, Inc. (AAL) is +6.39 at $22.95, with 57,877,936 shares traded. Nokia Corporation (NOK) is -1.02 at $5.53, with 112,353,402 shares traded.NOK is scheduled to provide an earnings report on 2/4/2021, for the fiscal quarter ending Dec2020. Business Wire Reports: JetBlue and American Airlines Advance Strategic Alliance Following Regulatory Review
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American Airlines Group, Inc. (AAL) is +6.39 at $22.95, with 57,877,936 shares traded. The consensus earnings per share forecast is 0.12 per share, which represents a 17 percent increase over the EPS one Year Ago AMC Entertainment Holdings, Inc. (AMC) is -4.24 at $15.66, with 51,924,338 shares traded., following a 52-week high recorded in prior regular session.
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American Airlines Group, Inc. (AAL) is +6.39 at $22.95, with 57,877,936 shares traded. The consensus earnings per share forecast is 0.12 per share, which represents a 17 percent increase over the EPS one Year Ago AMC Entertainment Holdings, Inc. (AMC) is -4.24 at $15.66, with 51,924,338 shares traded., following a 52-week high recorded in prior regular session.
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American Airlines Group, Inc. (AAL) is +6.39 at $22.95, with 57,877,936 shares traded. Express, Inc. (EXPR) is -0.25 at $9.30, with 8,187,348 shares traded., following a 52-week high recorded in prior regular session. Carnival Corporation (CCL) is +1.69 at $20.67, with 6,545,653 shares traded.
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4770.0
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2021-01-28 00:00:00 UTC
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American Airlines Group Posts Adj. Loss In Q4; Revenues down 64.4%
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-posts-adj.-loss-in-q4-revenues-down-64.4-2021-01-28
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nan
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nan
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(RTTNews) - American Airlines Group Inc. (AAL) reported a fourth quarter loss per share, excluding special items, of $3.86 compared to profit of $1.15, a year ago. On average, 18 analysts polled by Thomson Reuters expected the company to report a loss per share of $4.11, for the quarter. Analysts' estimates typically exclude special items.
Fourth quarter total operating revenues were $4.03 billion, down 64.4 percent from a year ago on a 53% reduction in total available seat miles. Analysts expected revenue of $3.88 billion, for the quarter.
American expects first-quarter system capacity to be down 45% year-on-year, with total revenue expected to be down 60 to 65%.
American Airlines Group ended fourth quarter with approximately $14.3 billion of total available liquidity. The company expects to end the first quarter with approximately $15.0 billion in total available liquidity.
To reduce costs, American incorporated more than $1.3 billion of permanent non-volume, non-fuel efficiency cost-saving measures into 2021 operating plan.
Shares of American Airlines Group were up 27% in pre-market trade on Thursday.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Group Inc. (AAL) reported a fourth quarter loss per share, excluding special items, of $3.86 compared to profit of $1.15, a year ago. On average, 18 analysts polled by Thomson Reuters expected the company to report a loss per share of $4.11, for the quarter. To reduce costs, American incorporated more than $1.3 billion of permanent non-volume, non-fuel efficiency cost-saving measures into 2021 operating plan.
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(RTTNews) - American Airlines Group Inc. (AAL) reported a fourth quarter loss per share, excluding special items, of $3.86 compared to profit of $1.15, a year ago. Fourth quarter total operating revenues were $4.03 billion, down 64.4 percent from a year ago on a 53% reduction in total available seat miles. American Airlines Group ended fourth quarter with approximately $14.3 billion of total available liquidity.
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(RTTNews) - American Airlines Group Inc. (AAL) reported a fourth quarter loss per share, excluding special items, of $3.86 compared to profit of $1.15, a year ago. Fourth quarter total operating revenues were $4.03 billion, down 64.4 percent from a year ago on a 53% reduction in total available seat miles. American Airlines Group ended fourth quarter with approximately $14.3 billion of total available liquidity.
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(RTTNews) - American Airlines Group Inc. (AAL) reported a fourth quarter loss per share, excluding special items, of $3.86 compared to profit of $1.15, a year ago. Analysts expected revenue of $3.88 billion, for the quarter. American Airlines Group ended fourth quarter with approximately $14.3 billion of total available liquidity.
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4771.0
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2021-01-28 00:00:00 UTC
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American Airlines Group Inc Q4 adjusted earnings Beat Estimates
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-inc-q4-adjusted-earnings-beat-estimates-2021-01-28
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nan
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nan
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(RTTNews) - Below are the earnings highlights for American Airlines Group Inc (AAL):
-Earnings: -$2.18 billion in Q4 vs. $0.41 billion in the same period last year. -EPS: -$3.81 in Q4 vs. $0.95 in the same period last year. -Excluding items, American Airlines Group Inc reported adjusted earnings of -$2.21 billion or -$3.86 per share for the period. -Analysts projected -$4.11 per share -Revenue: $4.03 billion in Q4 vs. $11.31 billion in the same period last year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - Below are the earnings highlights for American Airlines Group Inc (AAL): -Earnings: -$2.18 billion in Q4 vs. $0.41 billion in the same period last year. -Excluding items, American Airlines Group Inc reported adjusted earnings of -$2.21 billion or -$3.86 per share for the period. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - Below are the earnings highlights for American Airlines Group Inc (AAL): -Earnings: -$2.18 billion in Q4 vs. $0.41 billion in the same period last year. -Excluding items, American Airlines Group Inc reported adjusted earnings of -$2.21 billion or -$3.86 per share for the period. -Analysts projected -$4.11 per share -Revenue: $4.03 billion in Q4 vs. $11.31 billion in the same period last year.
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(RTTNews) - Below are the earnings highlights for American Airlines Group Inc (AAL): -Earnings: -$2.18 billion in Q4 vs. $0.41 billion in the same period last year. -Analysts projected -$4.11 per share -Revenue: $4.03 billion in Q4 vs. $11.31 billion in the same period last year. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - Below are the earnings highlights for American Airlines Group Inc (AAL): -Earnings: -$2.18 billion in Q4 vs. $0.41 billion in the same period last year. -Analysts projected -$4.11 per share -Revenue: $4.03 billion in Q4 vs. $11.31 billion in the same period last year. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4772.0
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2021-01-28 00:00:00 UTC
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Why Shares of American Airlines Are Soaring Today
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AAL
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https://www.nasdaq.com/articles/why-shares-of-american-airlines-are-soaring-today-2021-01-28
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nan
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nan
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What happened
Shares of American Airlines Group (NASDAQ: AAL) jumped as much as 30% higher on Thursday morning following the airline's fourth-quarter earnings announcement. The results came in a bit better than expectations, but weren't good enough to justify the response.
So what
Before markets opened, American said it lost $3.86 per share in the fourth quarter on revenue of $4 billion, besting analyst expectations for a $4.11-per-share loss on revenue of $3.88 billion. Revenue during the quarter was down 64% from a year prior, with the airline burning through about $30 million per day during the period.
Image source: American Airlines.
American and other airlines have been hit hard by the COVID-19 pandemic, which reduced demand for travel. The industry has raised billions in order to survive the crisis, but is facing a prolonged recovery.
In a statement, CEO Doug Parker called 2020 "the most challenging year in our company's history," and admitted the timing of a recovery is uncertain.
"As we look to the year ahead, 2021 will be a year of recovery," Parker said. "While we don't know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready."
American expects first-quarter 2021 revenue to be down 60% to 65% from a year prior. The airline expects to end the quarter with about $15 billion in total available liquidity, enough to continue to manage through this difficult period.
Now what
There is nothing about American's results that stood out from other airlines that have reported, yet the stock's reaction is disproportionate to the movement of the rest of the industry.
As I wrote yesterday, it seems likely some of this movement is connected to the Reddit community WallStreetBets, which has targeted stocks with a significant number of shares sold short. American has the largest short interest of any major airline, and it is likely many of those shorts are covering their positions and bidding the stock price up out of fear of being caught in a short squeeze.
Regardless of the reason, it is too much too soon for an airline that, although positioned to survive, is not likely to be one of the first to recover. If I were running American, I'd be looking at the stock reaction and considering a secondary offering to raise cash and begin paying down some of the billions in debt added due to the pandemic. That's of course assuming the jump holds, which given the stock's movement on Thursday is no guarantee.
For individual investors, the best advice is to watch this drama play out from the sidelines.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of American Airlines Group (NASDAQ: AAL) jumped as much as 30% higher on Thursday morning following the airline's fourth-quarter earnings announcement. In a statement, CEO Doug Parker called 2020 "the most challenging year in our company's history," and admitted the timing of a recovery is uncertain. As I wrote yesterday, it seems likely some of this movement is connected to the Reddit community WallStreetBets, which has targeted stocks with a significant number of shares sold short.
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What happened Shares of American Airlines Group (NASDAQ: AAL) jumped as much as 30% higher on Thursday morning following the airline's fourth-quarter earnings announcement. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them! See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman has no position in any of the stocks mentioned.
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What happened Shares of American Airlines Group (NASDAQ: AAL) jumped as much as 30% higher on Thursday morning following the airline's fourth-quarter earnings announcement. 10 stocks we like better than American Airlines Group When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them!
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What happened Shares of American Airlines Group (NASDAQ: AAL) jumped as much as 30% higher on Thursday morning following the airline's fourth-quarter earnings announcement. "As we look to the year ahead, 2021 will be a year of recovery," Parker said. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them!
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4773.0
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2021-01-28 00:00:00 UTC
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American Airlines Group Q4 20 Earnings Conference Call 8:30 AM ET
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AAL
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https://www.nasdaq.com/articles/american-airlines-group-q4-20-earnings-conference-call-8%3A30-am-et-2021-01-28
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nan
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nan
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(RTTNews) - American Airlines Group Inc. (AAL) will host a conference call at 8:30 AM ET on January 28, 2021, to discuss Q4 20 earnings results.
To access the live webcast, log on to http://aa.com/investorrelations
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Group Inc. (AAL) will host a conference call at 8:30 AM ET on January 28, 2021, to discuss Q4 20 earnings results. To access the live webcast, log on to http://aa.com/investorrelations The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Group Inc. (AAL) will host a conference call at 8:30 AM ET on January 28, 2021, to discuss Q4 20 earnings results. To access the live webcast, log on to http://aa.com/investorrelations The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Group Inc. (AAL) will host a conference call at 8:30 AM ET on January 28, 2021, to discuss Q4 20 earnings results. To access the live webcast, log on to http://aa.com/investorrelations The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Group Inc. (AAL) will host a conference call at 8:30 AM ET on January 28, 2021, to discuss Q4 20 earnings results. To access the live webcast, log on to http://aa.com/investorrelations The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4774.0
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2021-01-28 00:00:00 UTC
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S.Africa's Amplats reports 7% fall in PGM output in Q4
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AAL
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https://www.nasdaq.com/articles/s.africas-amplats-reports-7-fall-in-pgm-output-in-q4-2021-01-28
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nan
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nan
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JOHANNESBURG, Jan 28 (Reuters) - South Africa's Anglo American Platinum Ltd AMSJ.J (Amplats) said on Thursday its fourth-quarter platinum group metals (PGM) production fell 7% versus a year earlier.
PGM production fell to 1,076,100 ounces for the quarter that ended Dec. 31, the company said, noting many employees could not get to work due to local community unrest and "minor operational issues" at one of its mines.
PGM sales by volume from production fell 47% to 754,300 ounces, driven by lower refined production but partially offset by a drawdown of refined inventory, the company said.
(Reporting by Promit Mukherjee; editing by Jason Neely)
((promit.mukherjee@thomsonreuters.com; +27 64833 4448;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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JOHANNESBURG, Jan 28 (Reuters) - South Africa's Anglo American Platinum Ltd AMSJ.J (Amplats) said on Thursday its fourth-quarter platinum group metals (PGM) production fell 7% versus a year earlier. PGM production fell to 1,076,100 ounces for the quarter that ended Dec. 31, the company said, noting many employees could not get to work due to local community unrest and "minor operational issues" at one of its mines. PGM sales by volume from production fell 47% to 754,300 ounces, driven by lower refined production but partially offset by a drawdown of refined inventory, the company said.
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JOHANNESBURG, Jan 28 (Reuters) - South Africa's Anglo American Platinum Ltd AMSJ.J (Amplats) said on Thursday its fourth-quarter platinum group metals (PGM) production fell 7% versus a year earlier. PGM production fell to 1,076,100 ounces for the quarter that ended Dec. 31, the company said, noting many employees could not get to work due to local community unrest and "minor operational issues" at one of its mines. PGM sales by volume from production fell 47% to 754,300 ounces, driven by lower refined production but partially offset by a drawdown of refined inventory, the company said.
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JOHANNESBURG, Jan 28 (Reuters) - South Africa's Anglo American Platinum Ltd AMSJ.J (Amplats) said on Thursday its fourth-quarter platinum group metals (PGM) production fell 7% versus a year earlier. PGM sales by volume from production fell 47% to 754,300 ounces, driven by lower refined production but partially offset by a drawdown of refined inventory, the company said. (Reporting by Promit Mukherjee; editing by Jason Neely) ((promit.mukherjee@thomsonreuters.com; +27 64833 4448;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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JOHANNESBURG, Jan 28 (Reuters) - South Africa's Anglo American Platinum Ltd AMSJ.J (Amplats) said on Thursday its fourth-quarter platinum group metals (PGM) production fell 7% versus a year earlier. PGM production fell to 1,076,100 ounces for the quarter that ended Dec. 31, the company said, noting many employees could not get to work due to local community unrest and "minor operational issues" at one of its mines. PGM sales by volume from production fell 47% to 754,300 ounces, driven by lower refined production but partially offset by a drawdown of refined inventory, the company said.
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4775.0
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2021-01-28 00:00:00 UTC
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Anglo American lowers diamond output targets
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AAL
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https://www.nasdaq.com/articles/anglo-american-lowers-diamond-output-targets-2021-01-28
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nan
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nan
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LONDON, Jan 28 (Reuters) - Anglo American AAL.L on Thursday has trimmed its production guidance for diamonds in 2021 owing to operational challenges, it said on Thursday, adding that demand remains healthy.
In commodities such as copper, platinum group metals and coal, the diversified miner kept most of its output targets unchanged.
Copper production climbed 6% to 168,000 tonnes in the fourth quarter while diamond output slipped 14% and iron ore fell 11%
(Reporting by Zandi Shabalala Editing by David Goodman )
((zandi.shabalala@tr.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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LONDON, Jan 28 (Reuters) - Anglo American AAL.L on Thursday has trimmed its production guidance for diamonds in 2021 owing to operational challenges, it said on Thursday, adding that demand remains healthy. In commodities such as copper, platinum group metals and coal, the diversified miner kept most of its output targets unchanged. Copper production climbed 6% to 168,000 tonnes in the fourth quarter while diamond output slipped 14% and iron ore fell 11% (Reporting by Zandi Shabalala Editing by David Goodman ) ((zandi.shabalala@tr.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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LONDON, Jan 28 (Reuters) - Anglo American AAL.L on Thursday has trimmed its production guidance for diamonds in 2021 owing to operational challenges, it said on Thursday, adding that demand remains healthy. In commodities such as copper, platinum group metals and coal, the diversified miner kept most of its output targets unchanged. Copper production climbed 6% to 168,000 tonnes in the fourth quarter while diamond output slipped 14% and iron ore fell 11% (Reporting by Zandi Shabalala Editing by David Goodman ) ((zandi.shabalala@tr.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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LONDON, Jan 28 (Reuters) - Anglo American AAL.L on Thursday has trimmed its production guidance for diamonds in 2021 owing to operational challenges, it said on Thursday, adding that demand remains healthy. In commodities such as copper, platinum group metals and coal, the diversified miner kept most of its output targets unchanged. Copper production climbed 6% to 168,000 tonnes in the fourth quarter while diamond output slipped 14% and iron ore fell 11% (Reporting by Zandi Shabalala Editing by David Goodman ) ((zandi.shabalala@tr.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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LONDON, Jan 28 (Reuters) - Anglo American AAL.L on Thursday has trimmed its production guidance for diamonds in 2021 owing to operational challenges, it said on Thursday, adding that demand remains healthy. In commodities such as copper, platinum group metals and coal, the diversified miner kept most of its output targets unchanged. Copper production climbed 6% to 168,000 tonnes in the fourth quarter while diamond output slipped 14% and iron ore fell 11% (Reporting by Zandi Shabalala Editing by David Goodman ) ((zandi.shabalala@tr.com;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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4776.0
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2021-01-27 00:00:00 UTC
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American Airlines Surges 10% in Early Trading: Could WallStreetBets Be to Blame?
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AAL
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https://www.nasdaq.com/articles/american-airlines-surges-10-in-early-trading%3A-could-wallstreetbets-be-to-blame-2021-01-27
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nan
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nan
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What happened
Shares of American Airlines Group (NASDAQ: AAL) soared 10% higher on Wednesday morning, a day without any company news and when the rest of the airline industry was relatively quiet. It's hard to know for sure what is driving the stock higher, but my guess is it is getting swept up in the biggest story playing out on Wall Street right now.
So what
Markets are abuzz right now discussing the dramatic moves higher by stocks including GameStop and AMC Entertainment Holdings. Both stocks have shot higher in recent days in large part due to a Reddit discussion community known as WallStreetBets.
WallStreetBets has been targeting stocks unloved by investors, seeking out companies with a large number of their shares sold short. A short sale is a bet that a stock price will fall, and at times a stock can surge higher if bulls can create a short squeeze that forces shorts to cover their pessimistic bets.
Image source: American Airlines.
American Airlines is one such stock. About 171.3 million of its 610.8 million shares outstanding, or about 28%, are currently sold short, according to S&P Capital IQ. That compares to about 4.4% of United Airlines Holdings (NASDAQ: UAL) shares, 2.9% of Southwest Airlines (NYSE: LUV) shares, and 2% of Delta Air Lines (NYSE: DAL) shares.
Although there is nothing on the Reddit forum to suggest the WallStreetBets group has actively targeted American, I think it is likely that short sellers who are taking massive losses on stocks like GameStop and AMC Entertainment are cashing out of other positions as well. That is creating buy order demand for American shares, sending the price higher.
Indeed, as of 11:30 a.m. EST, about 75 million American shares have traded on the day. On a typical day about 100 million shares trade during the entire session.
Now what
Investors need to be cautious here. American was the most shorted airline for a good reason. While the company should have the cash reserves to survive the COVID-19 pandemic it entered the crisis as the weakest of the major airlines, and will likely need longer than most to recover.
I don't see American as a compelling buy right now compared to Delta or Southwest, but then again it seems dangerous to short the stock as the vaccine rollout speeds up even without external forces weighing on the shares.
The best thing for long-term investors to do is ignore the chaos playing out right now, and stick with buying strong companies and holding through the turbulence.
10 stocks we like better than American Airlines Group
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and American Airlines Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Lou Whiteman owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What happened Shares of American Airlines Group (NASDAQ: AAL) soared 10% higher on Wednesday morning, a day without any company news and when the rest of the airline industry was relatively quiet. Although there is nothing on the Reddit forum to suggest the WallStreetBets group has actively targeted American, I think it is likely that short sellers who are taking massive losses on stocks like GameStop and AMC Entertainment are cashing out of other positions as well. While the company should have the cash reserves to survive the COVID-19 pandemic it entered the crisis as the weakest of the major airlines, and will likely need longer than most to recover.
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What happened Shares of American Airlines Group (NASDAQ: AAL) soared 10% higher on Wednesday morning, a day without any company news and when the rest of the airline industry was relatively quiet. WallStreetBets has been targeting stocks unloved by investors, seeking out companies with a large number of their shares sold short. That compares to about 4.4% of United Airlines Holdings (NASDAQ: UAL) shares, 2.9% of Southwest Airlines (NYSE: LUV) shares, and 2% of Delta Air Lines (NYSE: DAL) shares.
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What happened Shares of American Airlines Group (NASDAQ: AAL) soared 10% higher on Wednesday morning, a day without any company news and when the rest of the airline industry was relatively quiet. A short sale is a bet that a stock price will fall, and at times a stock can surge higher if bulls can create a short squeeze that forces shorts to cover their pessimistic bets. That compares to about 4.4% of United Airlines Holdings (NASDAQ: UAL) shares, 2.9% of Southwest Airlines (NYSE: LUV) shares, and 2% of Delta Air Lines (NYSE: DAL) shares.
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What happened Shares of American Airlines Group (NASDAQ: AAL) soared 10% higher on Wednesday morning, a day without any company news and when the rest of the airline industry was relatively quiet. WallStreetBets has been targeting stocks unloved by investors, seeking out companies with a large number of their shares sold short. American Airlines is one such stock.
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4777.0
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2021-01-25 00:00:00 UTC
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Why Airline Shares Are Falling Today
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AAL
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https://www.nasdaq.com/articles/why-airline-shares-are-falling-today-2021-01-25
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nan
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nan
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What happened
Airline shares are under pressure on Monday, weighed down by pessimistic news concerning the pace of both vaccine deployment and a new round of stimulus. There's hope 2021 will be better than 2020, but investors are under no delusion that the turnaround will be quick.
Spirit Airlines (NYSE: SAVE) fell as much as 5.8% midday on Monday, while shares of United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and JetBlue Airways (NASDAQ: JBLU) each fell more than 4% apiece.
So what
The airline industry was devastated by the pandemic, only surviving because airlines were able to raise billions in cash to offset significant losses as travel demand disappeared. There's hope for better days in 2021, but that is going to require widespread vaccinations and a healthy economy.
The question is how long will it take until we get there, and on Monday investors are digesting mostly negative updates. Airlines joined the broader markets in reacting negatively to reports out of Washington that a much-anticipated second stimulus plan would be delayed, raising questions about what lies ahead for the U.S. economy.
Image source: Getty Images.
Airlines were also reacting to a couple of reminders that even with the positive news surrounding a vaccine rollout, there is still a slow, difficult battle up ahead. Merck announced it was discontinuing its COVID-19 vaccine development program following disappointing data from early trials. Moderna, meanwhile, said that while its existing vaccine does confer a strong immune response to new strains of COVID-19, it is testing an additional booster to ensure maximum effectiveness.
Neither of those headlines mean the bull case for a recovery is in jeopardy, but they are both setbacks. To get a recovery by next summer, we are going to need all the vaccine doses we can find, and Merck canceling its work means one less source of potential vaccines. And the Moderna headline, if nothing else, is a reminder that the vaccine is ever evolving and what seems like progress now could halt if additional shots are required.
Among the airlines, Spirit is expected to be one of the first to recover should leisure demand rebound in time for the summer vacation season. Any delays that might lead to another slow summer travel season take a lot of the wind out of the bull case for Spirit. Southwest, too, is expected to be among the first to recover, while United and American are two of the more vulnerable airlines that can least afford an extended downturn.
Now what
Interesting to note Delta Air Lines (NYSE: DAL), though down, is holding up better than most. Delta earlier in the month set an optimistic tone for the industry by calling 2021 a "year of recovery," and on Monday it said it is making plans to bring back some of the pilots taken off of active duty in the months to come.
The bottom line is that a recovery does appear to be at hand, but it is going to take most of 2021, if not longer, for conditions to normalize. Investors who want to buy in and wait out what is likely to be a choppy recovery should stick to top names like Delta and Southwest and do their best to block out the day-to-day headlines.
10 stocks we like better than Southwest Airlines
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Southwest Airlines wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool owns shares of Spirit Airlines. The Motley Fool recommends Delta Air Lines, JetBlue Airways, and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Spirit Airlines (NYSE: SAVE) fell as much as 5.8% midday on Monday, while shares of United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and JetBlue Airways (NASDAQ: JBLU) each fell more than 4% apiece. What happened Airline shares are under pressure on Monday, weighed down by pessimistic news concerning the pace of both vaccine deployment and a new round of stimulus. Airlines joined the broader markets in reacting negatively to reports out of Washington that a much-anticipated second stimulus plan would be delayed, raising questions about what lies ahead for the U.S. economy.
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Spirit Airlines (NYSE: SAVE) fell as much as 5.8% midday on Monday, while shares of United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and JetBlue Airways (NASDAQ: JBLU) each fell more than 4% apiece. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool recommends Delta Air Lines, JetBlue Airways, and Southwest Airlines.
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Spirit Airlines (NYSE: SAVE) fell as much as 5.8% midday on Monday, while shares of United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and JetBlue Airways (NASDAQ: JBLU) each fell more than 4% apiece. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool recommends Delta Air Lines, JetBlue Airways, and Southwest Airlines.
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Spirit Airlines (NYSE: SAVE) fell as much as 5.8% midday on Monday, while shares of United Airlines Holdings (NASDAQ: UAL), American Airlines Group (NASDAQ: AAL), Southwest Airlines (NYSE: LUV), and JetBlue Airways (NASDAQ: JBLU) each fell more than 4% apiece. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool owns shares of Spirit Airlines.
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4778.0
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2021-01-25 00:00:00 UTC
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3 Stocks to Avoid This Week
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AAL
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https://www.nasdaq.com/articles/3-stocks-to-avoid-this-week-2021-01-25
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nan
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nan
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I took a look at three stocks to avoid last week, predicting that Blink Charging (NASDAQ: BLNK), DoorDash (NYSE: DASH), and GameStop (NYSE: GME) were going to have a challenging week. It went horribly for me this time.
Blink Charging declined 6% last week. The electric vehicle charging specialist continues to be one of the market's biggest gainers since the start of last year, but a step back works for my weekly column. What can go wrong with the other two panned picks?
DoorDash climbed 3% for the week. The leading takeout delivery app inched higher, but in a week when the S&P 500 index rose 2% I'm still ahead with the combined return of the first two picks. There's no way I missed this week. Right?
GameStop soared 83% -- yes, 83% -- during the holiday-shortened trading week. There was no material news on the stock, but given the huge short interest on the video game retailer it's fair to say that another short squeeze was afoot.
The three stocks averaged a 26.7% advance. Naturally the S&P 500's 1.9% ascent is no match for that kind of run. I was wrong. This week, I see American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop as vulnerable investments in the near term. Here's why I think these are three stocks to avoid this week.
Image source: Getty Images.
American Airlines Group
We're in the heart of earnings season, and there are hundreds of companies reporting their quarterly results. American Airlines checks in on Thursday, and if you see the "fasten your seatbelt" light go on it's only because things are going to get bumpy as the the stock continues its trajectory of descent. We know that airlines are having a rough time in the new normal, and American Airlines in particular has been a mess.
Revenue is expected to plummet 66% for the quarter that ended last month. Analysts see a huge loss of $4.11 a share, but don't be surprised if it's worse. The red ink here has been more than what Wall Street was expecting in two of the past three quarters. It's burning through roughly $30 million a day in its current state.
The market sees American returning to profitability by 2023, but there's little to get excited about now. Consumer travel will continue to languish until the pandemic is crushed globally. Business travel will take even longer than that -- if it comes back at all.
Tesla Motors
Unlike the other two names on this list it's easy to see Tesla Motors beating the market this year. Its business is booming. It's hard to find a more aspirational brand in the realm of electric vehicles. However, with Tesla shares so strong heading into this week's earnings report it's easier to see the stock taking a breather even if it does come through with another strong report.
We already know how Tesla's production and deliveries played out for the quarter. The stock has more than doubled since its third-quarter results were announced three months ago. A lot of the report's success is already baked into the stock. Tesla reports on Wednesday. It's going to be a wild week.
GameStop
With the kind of run that GameStop had last year and so far in 2021 it's almost hard to forget that this is a company in an irreversible state of decline. Gamers have gone digital, and outside of the one-time blips when a new console is released GameStop's stores will continue to suffer.
Holiday sales were slightly positive for the small-box video game retailer, but that was the handiwork of big-ticket and unfortunately for GameStop low-margin PS5 sales. Those gamers won't be back. They know they can download games, and even for disc-based purchases there's usually a better price online. Sales have fallen sharply for three straight fiscal years, and there is no reason to expect that trend to reverse anytime soon.
Why is GameStop stock at an all-time high with its sales at a 12-year low? The answer is a short one -- as in short interest. There's roughly as many shares of GameStop sold short as there are shares outstanding. It doesn't take a lot to get the shorts running for the hills, and closing out those positions triggers a wave of buying. It's dangerous to short GameStop here, but it's even more dangerous to own the stock after huge gains that it did not earn.
If you're looking for safe stocks, you aren't likely to find them in American Airlines, DoorDash, or GameStop this week.
10 stocks we like better than Tesla
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Tesla wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Rick Munarriz has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool recommends GameStop. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
This week, I see American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop as vulnerable investments in the near term. The electric vehicle charging specialist continues to be one of the market's biggest gainers since the start of last year, but a step back works for my weekly column. The leading takeout delivery app inched higher, but in a week when the S&P 500 index rose 2% I'm still ahead with the combined return of the first two picks.
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This week, I see American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop as vulnerable investments in the near term. I took a look at three stocks to avoid last week, predicting that Blink Charging (NASDAQ: BLNK), DoorDash (NYSE: DASH), and GameStop (NYSE: GME) were going to have a challenging week. There was no material news on the stock, but given the huge short interest on the video game retailer it's fair to say that another short squeeze was afoot.
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This week, I see American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop as vulnerable investments in the near term. I took a look at three stocks to avoid last week, predicting that Blink Charging (NASDAQ: BLNK), DoorDash (NYSE: DASH), and GameStop (NYSE: GME) were going to have a challenging week. If you're looking for safe stocks, you aren't likely to find them in American Airlines, DoorDash, or GameStop this week.
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This week, I see American Airlines Group (NASDAQ: AAL), Tesla Motors (NASDAQ: TSLA), and GameStop as vulnerable investments in the near term. Here's why I think these are three stocks to avoid this week. If you're looking for safe stocks, you aren't likely to find them in American Airlines, DoorDash, or GameStop this week.
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4779.0
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2021-01-24 00:00:00 UTC
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Wall St Week Ahead-Tech shares could retake market reins as earnings heat up
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AAL
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https://www.nasdaq.com/articles/wall-st-week-ahead-tech-shares-could-retake-market-reins-as-earnings-heat-up-2021-01-24
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nan
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nan
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By Lewis Krauskopf
NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening.
After leading markets higher for most of 2020, technology-related stocks took a backseat late last year to so-called value or cyclical plays, whose businesses are expected to gain the most from the economic revival promised by vaccines against COVID-19.
That shift has stalled in recent days as investors weighed lackluster outlooks from big banks and a blockbuster quarterly report from Netflix NFLX.O that lifted its shares by 17%. The Russell 1000 growth index .RLG was up 3.3% in the past week as of Friday morning, while its value counterpart .RLV fell 1.5%.
Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services.
“That is probably going to be the story of earnings season,” he said. “What will earnings mean in terms of the sustainability of this rotation that has occurred in the last eight, nine weeks.”
Steady growth and resilience in the face of the coronavirus pandemic made technology stocks desirable to investors, who poured money into the sector as widespread lockdowns devastated swaths of the U.S. economy.
But a resumption in tech outperformance could also revive concerns over investor crowding into popular names. The biggest five technology-related companies account for about 22% of the weight of the S&P 500.
Aside from Apple and Microsoft, other tech sector .SPLRCT companies due to report next week include payment processing firms Visa V.N and Mastercard MA.N and semiconductor company Advanced Micro Devices AMD.O. Tesla TSLA.O, whose explosive share price turned the electric car maker into one of the world's most valuable companies, reports on Wednesday.
So far, corporate profits have been strong across the board: Of 66 S&P 500 companies that have reported earnings, 87.9% have beaten Wall Street estimates, well above the long-term average of 65%, according to IBES data from Refinitiv.
Investors are particularly watching corporate outlooks, given the expectation of an economic rebound this year. Earnings are expected to rise 23.7% this year after falling 14.1% in 2020, according to Refinitiv.
While the tech sector's earnings held up relatively well in 2020, its expected profit growth of 14% in 2021 is below the S&P 500 overall and lags areas such as financials, industrials and materials.
“The risk is in situations where you have had such a good 2020, which is going to be capped off by this reporting next week, what do you do for an encore?” said Walter Todd, chief investment officer at Greenwood Capital.
Demand for Apple's iPhone 12 will be a key issue when the company reports on Wednesday, said Robert Pavlik, senior portfolio manager at Dakota Wealth Management. Analysts on average expect the company to report a 13% rise in quarterly earnings.
Kim Forrest, chief investment officer at Bokeh Capital Partners, is eager to learn how well Microsoft is making inroads with its work-from-home products. The software giant is expected to post an 8.7% rise in earnings.
Facebook, estimated to report a 25% rise in earnings, could field questions around any fallout for the social media business from the U.S. elections and banning of President Donald Trump from various platforms, investors said.
Earnings season is heating up as the S&P 500 has risen to records to start 2021, worrying some investors who say corporate results in the coming year will need to justify high stock valuations.
"Stocks have had a great run since October and you have to wonder with all the talk about the market possibly pulling back, when will it come or what will cause it," Pavlik said.
(Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Susan Fenton)
((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters Messaging: lewis.krauskopf.thomsonreuters.com@reuters.net, Twitter: @LKrauskopf))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. “What will earnings mean in terms of the sustainability of this rotation that has occurred in the last eight, nine weeks.” Steady growth and resilience in the face of the coronavirus pandemic made technology stocks desirable to investors, who poured money into the sector as widespread lockdowns devastated swaths of the U.S. economy.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Aside from Apple and Microsoft, other tech sector .SPLRCT companies due to report next week include payment processing firms Visa V.N and Mastercard MA.N and semiconductor company Advanced Micro Devices AMD.O. Analysts on average expect the company to report a 13% rise in quarterly earnings.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. Analysts on average expect the company to report a 13% rise in quarterly earnings.
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Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. Investors are particularly watching corporate outlooks, given the expectation of an economic rebound this year. Earnings are expected to rise 23.7% this year after falling 14.1% in 2020, according to Refinitiv.
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4780.0
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2021-01-22 00:00:00 UTC
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Wall St Week Ahead-Tech shares could retake market reins as earnings heat up
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AAL
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https://www.nasdaq.com/articles/wall-st-week-ahead-tech-shares-could-retake-market-reins-as-earnings-heat-up-2021-01-22
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nan
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nan
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By Lewis Krauskopf
NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening.
After leading markets higher for most of 2020, technology-related stocks took a backseat late last year to so-called value or cyclical plays, whose businesses are expected to gain the most from the economic revival promised by vaccines against COVID-19.
That shift has stalled in recent days as investors weighed lackluster outlooks from big banks and a blockbuster quarterly report from Netflix NFLX.O that lifted its shares by 17%. The Russell 1000 growth index .RLG was up 3.3% in the past week as of Friday morning, while its value counterpart .RLV fell 1.5%.
Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services.
“That is probably going to be the story of earnings season,” he said. “What will earnings mean in terms of the sustainability of this rotation that has occurred in the last eight, nine weeks.”
Steady growth and resilience in the face of the coronavirus pandemic made technology stocks desirable to investors, who poured money into the sector as widespread lockdowns devastated swaths of the U.S. economy.
But a resumption in tech outperformance could also revive concerns over investor crowding into popular names. The biggest five technology-related companies account for about 22% of the weight of the S&P 500.
Aside from Apple and Microsoft, other tech sector .SPLRCT companies due to report next week include payment processing firms Visa V.N and Mastercard MA.N and semiconductor company Advanced Micro Devices AMD.O. Tesla TSLA.O, whose explosive share price turned the electric car maker into one of the world's most valuable companies, reports on Wednesday.
So far, corporate profits have been strong across the board: Of 66 S&P 500 companies that have reported earnings, 87.9% have beaten Wall Street estimates, well above the long-term average of 65%, according to IBES data from Refinitiv.
Investors are particularly watching corporate outlooks, given the expectation of an economic rebound this year. Earnings are expected to rise 23.7% this year after falling 14.1% in 2020, according to Refinitiv.
While the tech sector's earnings held up relatively well in 2020, its expected profit growth of 14% in 2021 is below the S&P 500 overall and lags areas such as financials, industrials and materials.
“The risk is in situations where you have had such a good 2020, which is going to be capped off by this reporting next week, what do you do for an encore?” said Walter Todd, chief investment officer at Greenwood Capital.
Demand for Apple's iPhone 12 will be a key issue when the company reports on Wednesday, said Robert Pavlik, senior portfolio manager at Dakota Wealth Management. Analysts on average expect the company to report a 13% rise in quarterly earnings.
Kim Forrest, chief investment officer at Bokeh Capital Partners, is eager to learn how well Microsoft is making inroads with its work-from-home products. The software giant is expected to post an 8.7% rise in earnings.
Facebook, estimated to report a 25% rise in earnings, could field questions around any fallout for the social media business from the U.S. elections and banning of President Donald Trump from various platforms, investors said.
Earnings season is heating up as the S&P 500 has risen to records to start 2021, worrying some investors who say corporate results in the coming year will need to justify high stock valuations.
"Stocks have had a great run since October and you have to wonder with all the talk about the market possibly pulling back, when will it come or what will cause it," Pavlik said.
(Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Susan Fenton)
((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters Messaging: lewis.krauskopf.thomsonreuters.com@reuters.net, Twitter: @LKrauskopf))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. “What will earnings mean in terms of the sustainability of this rotation that has occurred in the last eight, nine weeks.” Steady growth and resilience in the face of the coronavirus pandemic made technology stocks desirable to investors, who poured money into the sector as widespread lockdowns devastated swaths of the U.S. economy.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Aside from Apple and Microsoft, other tech sector .SPLRCT companies due to report next week include payment processing firms Visa V.N and Mastercard MA.N and semiconductor company Advanced Micro Devices AMD.O. Analysts on average expect the company to report a 13% rise in quarterly earnings.
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By Lewis Krauskopf NEW YORK, Jan 22 (Reuters) - A bevy of major U.S. earnings reports next week led by Apple AAPL.O, Microsoft MSFT.O and Facebook FB.O could help technology and growth stocks reassert their dominance after a recent run by banks, energy and other potential beneficiaries of an economic reopening. Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. Analysts on average expect the company to report a 13% rise in quarterly earnings.
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Next week's crop of fourth-quarter results - with about a quarter of the S&P 500 .SPX reporting - could help determine whether the resurgence in growth stocks will continue, potentially threatening the recent rally in value and cyclical shares, said Chuck Carlson, chief executive officer at Horizon Investment Services. Investors are particularly watching corporate outlooks, given the expectation of an economic rebound this year. Earnings are expected to rise 23.7% this year after falling 14.1% in 2020, according to Refinitiv.
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4781.0
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2021-01-22 00:00:00 UTC
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United vs. Delta: Which Airline Stock Is A Better Bet?
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AAL
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https://www.nasdaq.com/articles/united-vs.-delta%3A-which-airline-stock-is-a-better-bet-2021-01-22
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nan
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nan
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United Airlines stock (NASDAQ: UAL) has declined by 50% in the past year as compared to a 30% drop observed for Delta Airlines stock (NYSE: DAL). Does that make United a better pick over Delta? Given the ongoing vaccination efforts in multiple countries and the possibility of economic recovery by mid-2021, Trefis believes that United’s stock can provide stronger gains to investors willing to bet on the slow-moving airline industry.
Per PSP2 (second phase payroll support program) restrictions, airline companies cannot return capital to investors through dividends and share repurchases until March 2022. Considering United’s low P/S multiple, the stock has more room for growth and provides investors with a likelihood of near-term capital gains. Trefis compares the historical trends in revenues, margins, and valuation multiple of both companies in an interactive dashboard analysis, United Airlines Holdings vs. Delta Air Lines – parts of which are highlighted below.
Revenue Growth
United’s growth has been similar to Delta’s over the last three years, with United’s Revenue expanding at an average rate of 5.8% per year from $36.6 billion in 2016 to $43.3 billion in 2019, versus Delta’s Revenue which grew by 6% per year from $39.5 billion in 2016 to $47 billion in 2019.
United and Delta’s topline has been majorly driven by tepid domestic demand in the past few years. Domestic passenger revenues account for 62% and 71% of United and Delta’s total revenues, respectively.
While both companies have a similar topline, Delta has a smaller and comparatively younger fleet – indicating lower maintenance and capital costs to sustain revenue growth.
Returns (Profits)
Coming to Returns, Delta has consistently outperformed United with a 5-percentage-point higher operating margin.
United’s lower operating margin has largely been due to higher compensation expenses and maintenance costs.
Thus, Delta’s stock trades at a higher P/S multiple, supported by its operating margin and lower interest expenses.
Risk
United looks like the riskier of the two companies from the perspective of financial leverage.
High fixed costs and significantly low demand took a heavy toll on all air carriers. With limited support from the CARES Act grant, all airliners loaded their balance sheet with cash to face any adverse situation if vaccine trials reported dismal results.
United and Delta ended Q3 2020 with $22 billion and $30 billion of long-term debt, respectively.
Interestingly, higher long-term debt during these times indicates a company’s capability to raise capital against unencumbered assets.
Thus, Delta is a safer bet as its balance sheet is loaded with cash to tackle any adverse scenario.
Based on historical revenue growth, margins, and liquidity risk, Delta is a safer bet over United. However, the government has been limiting losses via the payroll support program during the pandemic. In 2020, United and Delta observed $4 billion and $3.8 billion of operating cash outflow, respectively. As both companies observed similar operating cash outflows, a steeper decline in United’s P/S multiple looks unwarranted. Thus, United is a better pick over Delta for investors looking for near-term capital gains.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio to beat the market, with over 100% return since 2016, versus 55% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.
See all Trefis Price Estimates and Download Trefis Data here
What’s behind Trefis? See How It’s Powering New Collaboration and What-Ifs For CFOs and Finance Teams | Product, R&D, and Marketing Teams
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Given the ongoing vaccination efforts in multiple countries and the possibility of economic recovery by mid-2021, Trefis believes that United’s stock can provide stronger gains to investors willing to bet on the slow-moving airline industry. Trefis compares the historical trends in revenues, margins, and valuation multiple of both companies in an interactive dashboard analysis, United Airlines Holdings vs. Delta Air Lines – parts of which are highlighted below. With limited support from the CARES Act grant, all airliners loaded their balance sheet with cash to face any adverse situation if vaccine trials reported dismal results.
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United Airlines stock (NASDAQ: UAL) has declined by 50% in the past year as compared to a 30% drop observed for Delta Airlines stock (NYSE: DAL). Returns (Profits) Coming to Returns, Delta has consistently outperformed United with a 5-percentage-point higher operating margin. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.
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United Airlines stock (NASDAQ: UAL) has declined by 50% in the past year as compared to a 30% drop observed for Delta Airlines stock (NYSE: DAL). Trefis compares the historical trends in revenues, margins, and valuation multiple of both companies in an interactive dashboard analysis, United Airlines Holdings vs. Delta Air Lines – parts of which are highlighted below. Revenue Growth United’s growth has been similar to Delta’s over the last three years, with United’s Revenue expanding at an average rate of 5.8% per year from $36.6 billion in 2016 to $43.3 billion in 2019, versus Delta’s Revenue which grew by 6% per year from $39.5 billion in 2016 to $47 billion in 2019.
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Revenue Growth United’s growth has been similar to Delta’s over the last three years, with United’s Revenue expanding at an average rate of 5.8% per year from $36.6 billion in 2016 to $43.3 billion in 2019, versus Delta’s Revenue which grew by 6% per year from $39.5 billion in 2016 to $47 billion in 2019. Thus, Delta’s stock trades at a higher P/S multiple, supported by its operating margin and lower interest expenses. Based on historical revenue growth, margins, and liquidity risk, Delta is a safer bet over United.
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4782.0
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2021-01-21 00:00:00 UTC
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7 Airline Stocks Being Fueled by Vaccine News
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AAL
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https://www.nasdaq.com/articles/7-airline-stocks-being-fueled-by-vaccine-news-2021-01-21
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nan
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nan
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Airline stocks are taking flight after the approval of the Covid-19 vaccine. The vaccine rollout has the travel industry preparing for a rebound in demand this year. The U.S. Global Jets ETF’s (NYSEARCA:JETS) three-month returns are up roughly 24%.
Moderna’s (NASDAQ:MRNA) and Pfizer’s (NYSE:PFE) Covid-19 vaccine candidates were given the green light by the U.S. Food and Drug Administration last month. The vaccines have high efficacy rates, regardless of the recipient’s race, age and gender. Therefore, investors are giving tech stocks a break and are now turning their attention toward travel stocks.
The 7 Best Stocks To Buy In The Dow Jones Today
Here’s a look at seven airline stocks rebounding well amid the positive vaccine news:
American Airlines (NASDAQ:AAL)
Delta Airlines (NYSE:DAL)
Hawaiian Airlines (NASDAQ:HA)
United Airlines (NASDAQ:UAL)
Southwest Airlines (NYSE:LUV)
Copa Airlines (NYSE:CPA)
Volaris (NYSE:VLRS)
Airline Stocks to Buy: American Airlines (AAL)
AAL) airplane waiting on the tarmac. Represents airline stocks." width="300" height="169">
Source: GagliardiPhotography / Shutterstock.com
American Airlines was among the airline stocks that managed to stick the landing in the past couple of months. AAL stock generated an impressive 24% return in the past three months, despite burning through heaps of cash. Over the years, the company has proven to be a survivor and will march along toward meaningful recovery this year.
Needless to say, it’s been tough for airliners such as American in the past year. Its third-quarter report shows that it generated a $1.3 billion net income in 2019 compared to a $6.7 billion loss last year.
Moreover, its debt levels have shot up by over 600% in the past year. However, with the return of the moneymaking Boeing 737 MAX and the company’s effective belt-tightening measures, expect promising things ahead. With a more conducive business environment, the company should have enough cash flows to deal with its debt burden.
Delta Airlines (DAL)
DAL) airlines plane mid take-off" width="300" height="169">
Source: Markus Mainka / Shutterstock.com
The Covid-19 crisis has left deep scars on airliners, but Delta Airlines is arguably the best-positioned company in the sector. The Atlanta-based airline has executed its strategy effectively and is set for a significant rebound this year. DAL stock is up 26.6% in the past three months.
Delta posted a net loss of approximately $12.4 billion last year, its first annual loss since 2009. However, its fourth-quarter results show that it has nearly halved its cash burn and expects to be profitable this summer.
The 7 Best Growth Stocks To Snap Up For 2021
Moreover, it ended the quarter with $16.7 billion in liquidity. Delta’s best-in-class management effectively limited costs during the crisis, which has put it in a great position to bounce back from the crisis.
Hawaiian Airlines (HA)
Source: Shutterstock
Hawaiian Airlines was hit especially hard by the pandemic. Its quarantine requirements virtually killed tourist demand. Instead, it operated a minimal schedule supporting only essential travel and cargo demand. This is why HA stock is down 32% in the past year.
Revenue has tanked significantly throughout the year, witnessing double-digits in the past few quarters. However, the company has now removed the 14-day self-quarantine restrictions. Moreover, it has done exceedingly well in controlling its expenses and managing its debt levels.
It has also benefited from the additional $15 billion in payroll support from the U.S. government. In the next few months, Hawaiian Airlines will be testing three new domestic routes.
United Airlines (UAL)
Source: NextNewMedia / Shutterstock.com
United Airlines was among the first companies to sound the alarm about the devastation brought on by the pandemic. That has been evident in the airliner’s dismal earnings results in the past few quarters, in which revenues dropped by double-digits. However, in the past few months, upon the vaccine’s news, UAL stock is back to winning ways.
The company is taking a conservative path to recovery, with its primary goal being to reduce its cash burn significantly. It aims to reduce its fourth-quarter cash burn to $15 million, which is a major achievement considering how it averaged $40 million a few months ago.
9 Stocks That Investors Think Are the Next Amazon
The airline had roughly $19.4 billion in liquidity and a cash balance of $13.8 billion in the third quarter’s conclusion. Hence, it is in a great position to take advantage of the steady growth in demand.
Southwest Airlines (LUV)
Source: Shutterstock
Southwest Airlines has the most pristine balance sheet out of all its competitors, which has come in more than handy this year. As a result, it is among the companies that have done relatively well in the stock market in the past year. Its three-month returns relative to the S&P 500 are at an impressive 18%.
The company has done well to limit its cash burn through its cost-management efforts. It now estimates cash burn to be roughly $12 million per day in the fourth quarter. It expects demand to recover sluggishly but should benefit from the 37 MAX being back in service and improvements in leisure demand. Moreover, its cash balance is at an impressive $14.6 billion, which is significantly higher than most of its peers.
Another positive for LUV stock is that it’s undervalued based on forward estimates at this point.
Copa Airlines (CPA)
Source: Carlos Yudica/Shutterstock.com
Central-American airline company Copa, like other airline stocks, has had it remarkably tough in 2020. Revenues have nosedived in the past few quarters, with reductions as high as 97.8%. However, its niche position in the Latin American market and its low-cost structure makes CPA stock an interesting play this year.
Copa’s management stated that by December 2020, it was expecting a 40% uptick in demand. Such numbers are quite encouraging, considering how there was little or no demand for most of 2020. Its low-cost structure has enabled it to preserve its liquidity with roughly $866.4 million in cash equivalents.
7 Dividend Stocks That Are Growing Their Payouts
Moreover, its debt levels are relatively low at $1.49 billion. With the 737 MAX recertified and recovery in demand, I expect CPA stock to continue to grow in the coming months.
Volaris (VLRS)
Source: Shutterstock
Mexican low-cost carrier Volaris was the most successful airline company in 2020. It finished 2020 with more deployed capacity than the previous year. Moreover, it is estimated that revenues will be higher in 2021 than in 2019, with record net margins in the second half. VLRS stock’s three-month return is at an impressive 29%.
Volaris has been an anomaly in the airline sector, with the fastest recovery among its peers. Its results in December show that it operates at 102% capacity with a load factor of 78.5%. Its domestic market share grew 11% from January to November, and its international market share increased by 32% in the same period.
Following its equity raise of $162 million, it now has a cash balance of over $350 million. Therefore, with a strong foundation in 2020, expect a much stronger 2021 for Volaris.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University. He does not directly own the securities mentioned above.
The post 7 Airline Stocks Being Fueled by Vaccine News appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The 7 Best Stocks To Buy In The Dow Jones Today Here’s a look at seven airline stocks rebounding well amid the positive vaccine news: American Airlines (NASDAQ:AAL) Delta Airlines (NYSE:DAL) Hawaiian Airlines (NASDAQ:HA) United Airlines (NASDAQ:UAL) Southwest Airlines (NYSE:LUV) Copa Airlines (NYSE:CPA) Volaris (NYSE:VLRS) Airline Stocks to Buy: American Airlines (AAL) AAL) airplane waiting on the tarmac. AAL stock generated an impressive 24% return in the past three months, despite burning through heaps of cash. Moderna’s (NASDAQ:MRNA) and Pfizer’s (NYSE:PFE) Covid-19 vaccine candidates were given the green light by the U.S. Food and Drug Administration last month.
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The 7 Best Stocks To Buy In The Dow Jones Today Here’s a look at seven airline stocks rebounding well amid the positive vaccine news: American Airlines (NASDAQ:AAL) Delta Airlines (NYSE:DAL) Hawaiian Airlines (NASDAQ:HA) United Airlines (NASDAQ:UAL) Southwest Airlines (NYSE:LUV) Copa Airlines (NYSE:CPA) Volaris (NYSE:VLRS) Airline Stocks to Buy: American Airlines (AAL) AAL) airplane waiting on the tarmac. AAL stock generated an impressive 24% return in the past three months, despite burning through heaps of cash. Hawaiian Airlines (HA) Source: Shutterstock Hawaiian Airlines was hit especially hard by the pandemic.
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The 7 Best Stocks To Buy In The Dow Jones Today Here’s a look at seven airline stocks rebounding well amid the positive vaccine news: American Airlines (NASDAQ:AAL) Delta Airlines (NYSE:DAL) Hawaiian Airlines (NASDAQ:HA) United Airlines (NASDAQ:UAL) Southwest Airlines (NYSE:LUV) Copa Airlines (NYSE:CPA) Volaris (NYSE:VLRS) Airline Stocks to Buy: American Airlines (AAL) AAL) airplane waiting on the tarmac. AAL stock generated an impressive 24% return in the past three months, despite burning through heaps of cash. Delta Airlines (DAL) DAL) airlines plane mid take-off" width="300" height="169"> Source: Markus Mainka / Shutterstock.com The Covid-19 crisis has left deep scars on airliners, but Delta Airlines is arguably the best-positioned company in the sector.
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The 7 Best Stocks To Buy In The Dow Jones Today Here’s a look at seven airline stocks rebounding well amid the positive vaccine news: American Airlines (NASDAQ:AAL) Delta Airlines (NYSE:DAL) Hawaiian Airlines (NASDAQ:HA) United Airlines (NASDAQ:UAL) Southwest Airlines (NYSE:LUV) Copa Airlines (NYSE:CPA) Volaris (NYSE:VLRS) Airline Stocks to Buy: American Airlines (AAL) AAL) airplane waiting on the tarmac. AAL stock generated an impressive 24% return in the past three months, despite burning through heaps of cash. 9 Stocks That Investors Think Are the Next Amazon The airline had roughly $19.4 billion in liquidity and a cash balance of $13.8 billion in the third quarter’s conclusion.
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4783.0
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2021-01-21 00:00:00 UTC
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AAL March 5th Options Begin Trading
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AAL
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https://www.nasdaq.com/articles/aal-march-5th-options-begin-trading-2021-01-21
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Investors in American Airlines Group Inc (Symbol: AAL) saw new options become available today, for the March 5th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new March 5th contracts and identified one put and one call contract of particular interest.
The put contract at the $15.50 strike price has a current bid of $1.21. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $15.50, but will also collect the premium, putting the cost basis of the shares at $14.29 (before broker commissions). To an investor already interested in purchasing shares of AAL, that could represent an attractive alternative to paying $15.76/share today.
Because the $15.50 strike represents an approximate 2% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 100%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 7.81% return on the cash commitment, or 66.26% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for American Airlines Group Inc, and highlighting in green where the $15.50 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $18.50 strike price has a current bid of 46 cents. If an investor was to purchase shares of AAL stock at the current price level of $15.76/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $18.50. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 20.30% if the stock gets called away at the March 5th expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if AAL shares really soar, which is why looking at the trailing twelve month trading history for American Airlines Group Inc, as well as studying the business fundamentals becomes important. Below is a chart showing AAL's trailing twelve month trading history, with the $18.50 strike highlighted in red:
Considering the fact that the $18.50 strike represents an approximate 17% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 99%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 2.92% boost of extra return to the investor, or 24.78% annualized, which we refer to as the YieldBoost.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $15.76) to be 101%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if AAL shares really soar, which is why looking at the trailing twelve month trading history for American Airlines Group Inc, as well as studying the business fundamentals becomes important. Below is a chart showing AAL's trailing twelve month trading history, with the $18.50 strike highlighted in red: Considering the fact that the $18.50 strike represents an approximate 17% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options become available today, for the March 5th expiration.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.50 strike highlighted in red: Considering the fact that the $18.50 strike represents an approximate 17% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options become available today, for the March 5th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new March 5th contracts and identified one put and one call contract of particular interest.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.50 strike highlighted in red: Considering the fact that the $18.50 strike represents an approximate 17% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options become available today, for the March 5th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new March 5th contracts and identified one put and one call contract of particular interest.
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Below is a chart showing AAL's trailing twelve month trading history, with the $18.50 strike highlighted in red: Considering the fact that the $18.50 strike represents an approximate 17% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in American Airlines Group Inc (Symbol: AAL) saw new options become available today, for the March 5th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the AAL options chain for the new March 5th contracts and identified one put and one call contract of particular interest.
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4784.0
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2021-01-21 00:00:00 UTC
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South Africa's Gold Fields appoints former Amplats boss as CEO
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AAL
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https://www.nasdaq.com/articles/south-africas-gold-fields-appoints-former-amplats-boss-as-ceo-2021-01-21
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Gold Fields appoints Chris Griffith as new CEO
Nick Holland steps down at end March
Former Amplats boss plans to drive value creation
Adds share price, Griffith comments, photo
JOHANNESBURG, Jan 21 (Reuters) - Gold Fields GFIJ.J has appointed former Anglo American Platinum AMSJ.J (Amplats) boss Chris Griffith as chief executive, the South African miner said on Thursday.
The former Amplats and Kumba Iron Ore KIOJ.J CEO joins Gold Fields at a time when surging gold prices have boosted Gold Fields earnings.
Griffith plans to drive operational and financial value creation when he joins the company, he said during a conference.
"My focus will continue to be on value as it has been at the previous companies I have run and I will continue to do that," said Griffith.
A surge in the gold price and a weaker rand have given the South African gold industry, which has produced a third of the bullion mined in history, a lifeline after the disruption caused by the coronavirus pandemic.
Gold Fields shares closed up 5.07% at 144.43 rand, outpacing its gold peers .JGLDX, which rose 1.92%.
Gold Fields Chairwoman Cheryl Carolus said Griffith was the right person to take the business forward.
"He has deep-rooted operational mining experience and an impressive track record of delivering safe operational performance and leading effective change," said Carolus.
Gold Fields said that Griffith, who stepped down at Amplats in February last year, will join Gold Fields in April.
Griffith said the company's international footprint was among the reasons that the job appealed to him.
Gold Fields has mines in Australia, Peru, South Africa, Chile and West Africa.
Gold Fields' current CEO, Nick Holland, announced his retirement in August and agreed to retire six months earlier than originally planned to facilitate the leadership transition.
Carolus paid tribute to Holland, who joined Gold Fields as chief financial officer at its formation in 1998 and led the company as CEO for 13 years.
"Nick has defined Gold Fields as it is today: a global, highly profitable and sustainable company, which is widely considered a leader in its field," said Carolus.
(Reporting by Tanisha Heiberg; editing by Jane Merriman and Steve Orlofsky)
((Tanisha.Heiberg@thomsonreuters.com; +27117753034; Reuters Messaging: tanisha.heiberg.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Gold Fields appoints Chris Griffith as new CEO Nick Holland steps down at end March Former Amplats boss plans to drive value creation Adds share price, Griffith comments, photo JOHANNESBURG, Jan 21 (Reuters) - Gold Fields GFIJ.J has appointed former Anglo American Platinum AMSJ.J (Amplats) boss Chris Griffith as chief executive, the South African miner said on Thursday. Gold Fields Chairwoman Cheryl Carolus said Griffith was the right person to take the business forward. Carolus paid tribute to Holland, who joined Gold Fields as chief financial officer at its formation in 1998 and led the company as CEO for 13 years.
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Gold Fields appoints Chris Griffith as new CEO Nick Holland steps down at end March Former Amplats boss plans to drive value creation Adds share price, Griffith comments, photo JOHANNESBURG, Jan 21 (Reuters) - Gold Fields GFIJ.J has appointed former Anglo American Platinum AMSJ.J (Amplats) boss Chris Griffith as chief executive, the South African miner said on Thursday. Griffith plans to drive operational and financial value creation when he joins the company, he said during a conference. Gold Fields said that Griffith, who stepped down at Amplats in February last year, will join Gold Fields in April.
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Gold Fields appoints Chris Griffith as new CEO Nick Holland steps down at end March Former Amplats boss plans to drive value creation Adds share price, Griffith comments, photo JOHANNESBURG, Jan 21 (Reuters) - Gold Fields GFIJ.J has appointed former Anglo American Platinum AMSJ.J (Amplats) boss Chris Griffith as chief executive, the South African miner said on Thursday. The former Amplats and Kumba Iron Ore KIOJ.J CEO joins Gold Fields at a time when surging gold prices have boosted Gold Fields earnings. Gold Fields said that Griffith, who stepped down at Amplats in February last year, will join Gold Fields in April.
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The former Amplats and Kumba Iron Ore KIOJ.J CEO joins Gold Fields at a time when surging gold prices have boosted Gold Fields earnings. Griffith plans to drive operational and financial value creation when he joins the company, he said during a conference. Gold Fields said that Griffith, who stepped down at Amplats in February last year, will join Gold Fields in April.
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4785.0
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2021-01-21 00:00:00 UTC
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American Airlines Extends Offer To Waive Change Fees
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AAL
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https://www.nasdaq.com/articles/american-airlines-extends-offer-to-waive-change-fees-2021-01-21
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(RTTNews) - American Airlines has extended its offer to waive change fees for customers who purchase tickets for travel, until March 31 in response to lower travel demand due to the coronavirus pandemic. This means that travelers are provided additional flexibility by not asking them to pay penalties for changing the origin and destination cities.
Since the onset of the ongoing COVID-19 pandemic in January last year, this is the tenth time the airline is extending its period for change fees waiver.
The airline noted that the offer is available for any of American's fares. However, customers may still have to pay for any difference in fare, if applicable, at the time of re-booking for the new trip. Only the change fee will be waived.
This offer is now applicable for any ticket purchases made by customers for new travel on or before March 31, 2021 for future travel. The change fees are normally incurred by the customer prior to travel.
Effective November 19, 2020, the airline had also eliminated change fees for any of American's fares, except Basic Economy, for all long-haul international flying when travel originates in North or South America. Customers will also no longer pay a service charge when booking a ticket through reservations.
In late October, American Airlines said while reporting financial results for the third quarter it saw improvements in passenger demand and load factors, but both continued to be significantly below 2019 levels. It had called the second quarter the most challenging in American's history.
The company presently expects its fourth quarter system capacity to be down more than 50 percent year-over-year, with long-haul international capacity down approximately 75 percent.
Last week, American became the first U.S. airline to introduce a mobile health passport for inbound travel to the U.S. from all international destinations. Customers traveling to the U.S. can use the VeriFLY app to confirm testing and other COVID-19 travel requirements required for international travel into the U.S., beginning January 23.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Since the onset of the ongoing COVID-19 pandemic in January last year, this is the tenth time the airline is extending its period for change fees waiver. Effective November 19, 2020, the airline had also eliminated change fees for any of American's fares, except Basic Economy, for all long-haul international flying when travel originates in North or South America. In late October, American Airlines said while reporting financial results for the third quarter it saw improvements in passenger demand and load factors, but both continued to be significantly below 2019 levels.
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(RTTNews) - American Airlines has extended its offer to waive change fees for customers who purchase tickets for travel, until March 31 in response to lower travel demand due to the coronavirus pandemic. This offer is now applicable for any ticket purchases made by customers for new travel on or before March 31, 2021 for future travel. Customers traveling to the U.S. can use the VeriFLY app to confirm testing and other COVID-19 travel requirements required for international travel into the U.S., beginning January 23.
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(RTTNews) - American Airlines has extended its offer to waive change fees for customers who purchase tickets for travel, until March 31 in response to lower travel demand due to the coronavirus pandemic. Effective November 19, 2020, the airline had also eliminated change fees for any of American's fares, except Basic Economy, for all long-haul international flying when travel originates in North or South America. Customers traveling to the U.S. can use the VeriFLY app to confirm testing and other COVID-19 travel requirements required for international travel into the U.S., beginning January 23.
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(RTTNews) - American Airlines has extended its offer to waive change fees for customers who purchase tickets for travel, until March 31 in response to lower travel demand due to the coronavirus pandemic. Only the change fee will be waived. This offer is now applicable for any ticket purchases made by customers for new travel on or before March 31, 2021 for future travel.
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4786.0
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2021-01-21 00:00:00 UTC
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Alrosa sees strong demand for diamonds in Q1 after lower sales in 2020
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AAL
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https://www.nasdaq.com/articles/alrosa-sees-strong-demand-for-diamonds-in-q1-after-lower-sales-in-2020-2021-01-21
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Adds details, quotes, context
MOSCOW, Jan 21 (Reuters) - Russian state-controlled diamond producer Alrosa ALRS.MM sees strong global demand for diamonds in the first quarter of 2021 after its sales fell by 4% to 32.1 million carats in 2020 due to the coronavirus pandemic, it said on Thursday.
Alrosa, the world's largest producer of rough diamonds, which competes with Anglo American AAL.L unit De Beers, reduced 2020 production by 22% to 30 million carats as it suspended mining at less profitable mines.
"By the end of the year, demand for rough diamonds was strong and stable, driven by a balanced sales policy of major diamond producers seeking to meet real demand, along with a seasonal uptick in demand," Alrosa said.
The company along with its global peers focused on a "price-over-volume" strategy in 2020 to speed up the reduction of stocks in the cutting and polishing sector, the majority of which is located in India.
This sector is increasing its production now as jewellery businesses seek to replenish their inventories and due to market activity ahead of the Chinese New Year, it added.
Alrosa's 2020 sales revenue fell by 16% to $2.8 billion.
"Despite almost zero sales in the middle of 2020, Alrosa's 2020 sales look better than they could have been due to a strong fourth quarter," Artem Bagdasaryan, an analyst at BCS, said.
Global sales of luxury goods may show a growth of 10-20% in 2021 after their 23 percent drop in 2020, Alrosa told Reuters, citing an estimate of Bain consultancy.
If this forecast turns out to be correct, the diamond jewellery sector may show a similar dynamic, the miner said.
In mid-2020, the Russian government said it was considering buying some of Alrosa's diamonds to support it.
"At the moment, the market conditions allow us not to consider this option for the company yet. But we understand that such an option is available in case there is a need for it," Alrosa said.
(Reporting by Polina Devitt; Editing by Edmund Blair and David Evans)
((Polina.Devitt@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Alrosa, the world's largest producer of rough diamonds, which competes with Anglo American AAL.L unit De Beers, reduced 2020 production by 22% to 30 million carats as it suspended mining at less profitable mines. The company along with its global peers focused on a "price-over-volume" strategy in 2020 to speed up the reduction of stocks in the cutting and polishing sector, the majority of which is located in India. This sector is increasing its production now as jewellery businesses seek to replenish their inventories and due to market activity ahead of the Chinese New Year, it added.
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Alrosa, the world's largest producer of rough diamonds, which competes with Anglo American AAL.L unit De Beers, reduced 2020 production by 22% to 30 million carats as it suspended mining at less profitable mines. Adds details, quotes, context MOSCOW, Jan 21 (Reuters) - Russian state-controlled diamond producer Alrosa ALRS.MM sees strong global demand for diamonds in the first quarter of 2021 after its sales fell by 4% to 32.1 million carats in 2020 due to the coronavirus pandemic, it said on Thursday. "By the end of the year, demand for rough diamonds was strong and stable, driven by a balanced sales policy of major diamond producers seeking to meet real demand, along with a seasonal uptick in demand," Alrosa said.
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Alrosa, the world's largest producer of rough diamonds, which competes with Anglo American AAL.L unit De Beers, reduced 2020 production by 22% to 30 million carats as it suspended mining at less profitable mines. Adds details, quotes, context MOSCOW, Jan 21 (Reuters) - Russian state-controlled diamond producer Alrosa ALRS.MM sees strong global demand for diamonds in the first quarter of 2021 after its sales fell by 4% to 32.1 million carats in 2020 due to the coronavirus pandemic, it said on Thursday. "By the end of the year, demand for rough diamonds was strong and stable, driven by a balanced sales policy of major diamond producers seeking to meet real demand, along with a seasonal uptick in demand," Alrosa said.
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Alrosa, the world's largest producer of rough diamonds, which competes with Anglo American AAL.L unit De Beers, reduced 2020 production by 22% to 30 million carats as it suspended mining at less profitable mines. Adds details, quotes, context MOSCOW, Jan 21 (Reuters) - Russian state-controlled diamond producer Alrosa ALRS.MM sees strong global demand for diamonds in the first quarter of 2021 after its sales fell by 4% to 32.1 million carats in 2020 due to the coronavirus pandemic, it said on Thursday. The company along with its global peers focused on a "price-over-volume" strategy in 2020 to speed up the reduction of stocks in the cutting and polishing sector, the majority of which is located in India.
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4787.0
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2021-01-20 00:00:00 UTC
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United Airlines pledges more cost cuts after pandemic-driven quarterly loss
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AAL
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https://www.nasdaq.com/articles/united-airlines-pledges-more-cost-cuts-after-pandemic-driven-quarterly-loss-2021-01-20
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By Tracy Rucinski
Jan 20 (Reuters) - United Airlines Holdings Inc UAL.O said on Wednesday it aims to cut about $2 billion of annual costs through 2023 as it charts a recovery from the coronavirus pandemic that drove its fourth straight quarterly loss.
Airlines are counting on COVID-19 vaccines to boost travel demand later this year but warn that the strength of a rebound will largely depend on the pace of vaccine rollouts, particularly as coronavirus cases keep rising.
Chicago-based United said 2021 would be a "transition year that's focused on preparing for a recovery." Its shares fell 2% in after-hours trading.
The company burned an average of $33 million per day in the fourth quarter, including about $10 million of severance and debt payments, even as it continued to slash costs.
United furloughed thousands of employees last October when an initial round of payroll aid for airlines expired. It brought back those workers following a fresh $15 billion in payroll aid for the sector but warned the recall could be "temporary" as travel demand remains depressed.
United is set to receive about $2.6 billion in payroll support through March and said it expects to offer employees options like voluntary leaves to reduce furloughs after that time.
Rival Delta Air Lines DAL.N, which last week labeled 2021 a year of recovery, expects to halt its daily cash burn rate of about $12 million in the spring and does not expect any furloughs.
United has the greatest exposure of major U.S. airlines to international travel, the sector hardest hit by the pandemic and the one likely to be the slowest to recover.
U.S. President Joe Biden, who was inaugurated on Wednesday , plans to maintain a ban on travelers from Europe and Brazil that his predecessor, Donald Trump, had signed an order to lift beginning on Jan. 26.
United's adjusted net loss was $2.1 billion, or a loss of $7 per share, in the fourth quarter ended Dec. 31, compared with a profit of $676 million a year earlier. That missed analysts' estimates for a loss of $6.60 per share, according to IBES data from Refinitiv.
Total operating revenue fell 69% to $3.4 billion, in line with forecasts. In the current quarter, United said it expects revenue to fall by 65% to 70% from a year ago and its flight capacity to shrink by at least 51%.
The airline had $19.7 billion of liquidity as of Dec. 31 and expects to have a similar amount at the end of March, it said.
However, its cost reduction plan positions it to exceed its 2019 adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin - a key metric of profitability -in 2023, or sooner if demand returns more quickly, it said.
United will hold an investor call on Thursday.
American Airlines AAL.O and Southwest Airlines LUV.N are due to report quarterly results on Jan. 28.
(Reporting by Tracy Rucinski in Chicago Additional reporting by Shreyasee Raj in Bengaluru Editing by Matthew Lewis)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines AAL.O and Southwest Airlines LUV.N are due to report quarterly results on Jan. 28. By Tracy Rucinski Jan 20 (Reuters) - United Airlines Holdings Inc UAL.O said on Wednesday it aims to cut about $2 billion of annual costs through 2023 as it charts a recovery from the coronavirus pandemic that drove its fourth straight quarterly loss. U.S. President Joe Biden, who was inaugurated on Wednesday , plans to maintain a ban on travelers from Europe and Brazil that his predecessor, Donald Trump, had signed an order to lift beginning on Jan. 26.
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American Airlines AAL.O and Southwest Airlines LUV.N are due to report quarterly results on Jan. 28. By Tracy Rucinski Jan 20 (Reuters) - United Airlines Holdings Inc UAL.O said on Wednesday it aims to cut about $2 billion of annual costs through 2023 as it charts a recovery from the coronavirus pandemic that drove its fourth straight quarterly loss. It brought back those workers following a fresh $15 billion in payroll aid for the sector but warned the recall could be "temporary" as travel demand remains depressed.
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American Airlines AAL.O and Southwest Airlines LUV.N are due to report quarterly results on Jan. 28. By Tracy Rucinski Jan 20 (Reuters) - United Airlines Holdings Inc UAL.O said on Wednesday it aims to cut about $2 billion of annual costs through 2023 as it charts a recovery from the coronavirus pandemic that drove its fourth straight quarterly loss. United is set to receive about $2.6 billion in payroll support through March and said it expects to offer employees options like voluntary leaves to reduce furloughs after that time.
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American Airlines AAL.O and Southwest Airlines LUV.N are due to report quarterly results on Jan. 28. It brought back those workers following a fresh $15 billion in payroll aid for the sector but warned the recall could be "temporary" as travel demand remains depressed. United's adjusted net loss was $2.1 billion, or a loss of $7 per share, in the fourth quarter ended Dec. 31, compared with a profit of $676 million a year earlier.
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4788.0
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2021-01-20 00:00:00 UTC
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Take a Wait-and-See Approach With Boeing
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AAL
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https://www.nasdaq.com/articles/take-a-wait-and-see-approach-with-boeing-2021-01-20
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Peppered with positive moments, 2020 was not an easy year for American industrial icon Boeing (NYSE:BA). Suffice it to say that Boeing stock holders were hit hard as regulatory scrutiny persisted and the global novel coronavirus pandemic spread.
BA) 737 max aircraft" width="300" height="169">
Source: Marco Menezes / Shutterstock.com
It’s amazing to consider that Boeing stock was once considered the ultimate safety stock. Generations of investors bought and held the shares for years or even decades, collecting apparently safe dividends along the way.
The next thing you know, calamity strikes and Boeing is suspending its dividends. The company’s begging the government for aid, and investors are fleeing.
Is the situation as bad as it seems, though? Really, it depends on whether you choose to focus on the good news or the bad news. And believe me, there’s plenty of both.
A Closer Look at Boeing Stock
Like many other U.S. stocks, Boeing stock took a nasty fall in March of last year. Retirement accounts were drained as the share price plunged from nearly $350 to $89 in a matter of weeks.
The 7 Best Stocks to Buy in the Dow Jones Today
Now that Covid-19 vaccines are starting to be distributed, I don’t expect there to be a price decline of that magnitude in 2021. That being said, I wouldn’t be surprised if Boeing stock continues to struggle this year.
The lack of dividend payments won’t make things any easier for the shareholders. Moreover, it’s discouraging to know that Boeing stock’s trailing 12-month earnings per share, at -$7.89, is in negative territory.
As of Jan. 15, Boeing stock at least managed to stay above the key $200 level. Peaks achieved in June and December marked $230 as a hard resistance point. So, the bulls really need to clear that level and stay above it.
First, the Good News
“We’re flying on a Boeing 737 Max,” Capt. Sean Roskey announced over American Airlines (NASDAQ:AAL) Flight 718’s PA system on Dec. 29. “We have the utmost confidence in this aircraft. As a matter of fact, my wife is on board.”
That’s a strong vote of confidence, to say the least. It marked a signal event in Boeing’s turnaround attempt as the company’s 737 Max planes had been grounded since March 2019 in the wake of two deadly crashes.
The resumption of 737 Max flights was a much-needed shot in the arm for Boeing stock holders. In all of 2020, the company only managed to deliver 157 commercial aircraft. That’s fewer than half of the 380 aircraft Boeing delivered in 2019.
Furthermore, at least Boeing stock investors might look forward to a pickup in air travel this year. According to an IATA report, passenger numbers are projected to increase to 2.8 billion in 2021. That would represent a billion more passengers than were recorded in 2020.
A Fallen Icon
In the financial markets, oftentimes we must weigh the good news against the bad news. Alas, such is the case with Boeing stock.
I hate to be the bearer of bad news, but it appears that Boeing doesn’t hold the top spot among aircraft manufacturers anymore. Today, that title belongs to Airbus (OTCMKTS:EADSY).
Perhaps that’s just a blow to the ego, rather than a real problem. Yet, there’s no shortage of real, fundamental problems if you’re looking for them.
And frankly, you don’t even have to go back very far to find cracks in Boeing’s foundation. For instance, in 2020’s fourth quarter, Boeing reported commercial deliveries of 59 airplanes. You’ve got to admit, that’s pretty dismal.
Moreover, not long ago company coughed up $25 million to settle a dispute with the Pentagon over allegations that Boeing’s drone unit had overcharged the U.S. Navy for parts.
The fiscal damage from that dispute might be manageable, but the reputational damage could last for a while.
The Bottom Line
I suppose you could say that the overall picture presents a good-news, bad-news scenario for Boeing stock holders.
The good news is pretty good, but the bad news is hard to swallow. It’s probably best, therefore, to watch for further developments before taking a position in Boeing stock.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.
The post Take a Wait-and-See Approach With Boeing appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Sean Roskey announced over American Airlines (NASDAQ:AAL) Flight 718’s PA system on Dec. 29. It marked a signal event in Boeing’s turnaround attempt as the company’s 737 Max planes had been grounded since March 2019 in the wake of two deadly crashes. Moreover, not long ago company coughed up $25 million to settle a dispute with the Pentagon over allegations that Boeing’s drone unit had overcharged the U.S. Navy for parts.
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Sean Roskey announced over American Airlines (NASDAQ:AAL) Flight 718’s PA system on Dec. 29. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Peppered with positive moments, 2020 was not an easy year for American industrial icon Boeing (NYSE:BA). In all of 2020, the company only managed to deliver 157 commercial aircraft.
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Sean Roskey announced over American Airlines (NASDAQ:AAL) Flight 718’s PA system on Dec. 29. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Peppered with positive moments, 2020 was not an easy year for American industrial icon Boeing (NYSE:BA). BA) 737 max aircraft" width="300" height="169"> Source: Marco Menezes / Shutterstock.com It’s amazing to consider that Boeing stock was once considered the ultimate safety stock.
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Sean Roskey announced over American Airlines (NASDAQ:AAL) Flight 718’s PA system on Dec. 29. A Closer Look at Boeing Stock Like many other U.S. stocks, Boeing stock took a nasty fall in March of last year. The resumption of 737 Max flights was a much-needed shot in the arm for Boeing stock holders.
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4789.0
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2021-01-20 00:00:00 UTC
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Airlines Tap New Payroll Support Funds
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AAL
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https://www.nasdaq.com/articles/airlines-tap-new-payroll-support-funds-2021-01-20
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Last spring, the federal government provided $25 billion of payroll support funding to U.S. passenger airlines, preventing job cuts in the hard-hit industry. However, this aid only provided a temporary reprieve, which ended on Sept. 30. Airlines subsequently let go of tens of thousands of workers, after Congress failed to agree on a payroll support extension despite bipartisan support for the concept.
Congress finally approved a second round of payroll support last month. In recent days, three of the largest U.S. airlines reported that they have already received their first disbursements under the new program. Let's take a look at what this means for American Airlines, Delta Air Lines, and Southwest Airlines.
Airlines announce agreements with the Treasury Department
Congress allocated $15 billion for the second round of airline payroll support -- significantly less than the amount available under the original program last spring. This is filtering through to the amounts offered to each company.
AIRLINE
MARCH 2020 PAYROLL SUPPORT AMOUNT
DECEMBER 2020 PAYROLL SUPPORT AMOUNT
American Airlines (NASDAQ: AAL)
$6 billion
$3.1 billion
Delta Air Lines (NYSE: DAL)
$5.6 billion
$2.9 billion
Southwest Airlines (NYSE: LUV)
$3.4 billion
$1.7 billion
Data sources: American Airlines, Delta Air Lines, and Southwest Airlines SEC filings.
As with the initial payroll support program, grants will account for about 70% of the payroll support funds disbursed to these airlines. American, Delta, and Southwest will be required to repay the other 30%. This loan portion of the payroll support will carry very low interest rates, though: just 1% for the first five years.
The main condition attached to the new round of funding was that airlines had to recall all of their furloughed workers at full pay for the period from Dec. 1, 2020, through March 31, 2021. That includes retroactive pay for December.
All three companies reported that they received half of the expected payments under the new payroll support program last Friday. The other half will be disbursed later this quarter. The Treasury Department also might have funds left over after processing all of the payroll support applications, in which case it would provide a final additional payment toward the end of this quarter.
Who benefits the most?
Obviously, the payroll support extension is great news for all eligible U.S. airlines. They are getting a combination of free money and low-cost loans. However, some airlines are poised to reap a bigger benefit from this program than others.
From one perspective, American Airlines will be the top beneficiary. It has the weakest balance sheet of any major U.S. airline and is burning the most cash. (Last month, it estimated average daily cash burn for the fourth quarter at $30 million.) Thus, it had the greatest need for additional government support.
Image source: American Airlines.
On the other hand, American Airlines furloughed about 19,000 workers last fall. American's labor costs will increase from recalling those workers. By contrast, Delta and Southwest haven't furloughed any workers, relying instead on voluntary measures to minimize payroll costs. Thus, Delta and Southwest will see more of a bottom-line benefit from the payroll support program. (Moreover, since they are burning far less cash than American Airlines, their payroll support funds will go a lot further.)
Between Delta and Southwest, Delta Air Lines looks like the bigger winner from the new round of relief. It's set to receive about 70% more payroll support funding than Southwest, reflecting its larger size. Yet both airlines burned an average of about $12 million a day last quarter. Additionally, Southwest Airlines had planned to furlough up to 7,000 workers as soon as this month -- among other cuts -- had the payroll support program not been approved. It will now forgo the labor cost savings it otherwise could have captured.
Indeed, the $2 billion grant portion of Delta's payroll support easily exceeds its projected first-quarter cash burn. And with management expecting the airline to return to positive free cash flow next quarter, Delta Air Lines thinks its net debt has already peaked. That puts it in great shape to begin its recovery in 2021.
10 stocks we like better than Delta Air Lines
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Delta Air Lines wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Adam Levine-Weinberg owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines (NASDAQ: AAL) $6 billion $3.1 billion Delta Air Lines (NYSE: DAL) $5.6 billion $2.9 billion Southwest Airlines (NYSE: LUV) $3.4 billion $1.7 billion Data sources: American Airlines, Delta Air Lines, and Southwest Airlines SEC filings. Last spring, the federal government provided $25 billion of payroll support funding to U.S. passenger airlines, preventing job cuts in the hard-hit industry. The Treasury Department also might have funds left over after processing all of the payroll support applications, in which case it would provide a final additional payment toward the end of this quarter.
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American Airlines (NASDAQ: AAL) $6 billion $3.1 billion Delta Air Lines (NYSE: DAL) $5.6 billion $2.9 billion Southwest Airlines (NYSE: LUV) $3.4 billion $1.7 billion Data sources: American Airlines, Delta Air Lines, and Southwest Airlines SEC filings. Let's take a look at what this means for American Airlines, Delta Air Lines, and Southwest Airlines. The Motley Fool recommends Delta Air Lines and Southwest Airlines.
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American Airlines (NASDAQ: AAL) $6 billion $3.1 billion Delta Air Lines (NYSE: DAL) $5.6 billion $2.9 billion Southwest Airlines (NYSE: LUV) $3.4 billion $1.7 billion Data sources: American Airlines, Delta Air Lines, and Southwest Airlines SEC filings. Let's take a look at what this means for American Airlines, Delta Air Lines, and Southwest Airlines. As with the initial payroll support program, grants will account for about 70% of the payroll support funds disbursed to these airlines.
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American Airlines (NASDAQ: AAL) $6 billion $3.1 billion Delta Air Lines (NYSE: DAL) $5.6 billion $2.9 billion Southwest Airlines (NYSE: LUV) $3.4 billion $1.7 billion Data sources: American Airlines, Delta Air Lines, and Southwest Airlines SEC filings. As with the initial payroll support program, grants will account for about 70% of the payroll support funds disbursed to these airlines. Thus, Delta and Southwest will see more of a bottom-line benefit from the payroll support program.
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4790.0
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2021-01-19 00:00:00 UTC
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Eyeing a recovery, American Airlines' regional carrier to resume pilot hiring
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AAL
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https://www.nasdaq.com/articles/eyeing-a-recovery-american-airlines-regional-carrier-to-resume-pilot-hiring-2021-01-19
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By Tracy Rucinski
Jan 19 (Reuters) - American Airlines' AAL.O wholly-owned regional subsidiary PSA Airlines plans to resume new pilot hiring this year, a positive sign for an industry that was ravaged last year by the coronavirus pandemic but is now preparing to ramp up flying.
As COVID-19 vaccines continue to roll out, airlines are hoping for a significant improvement in domestic air travel by the summer, even if demand does not fully yet recoup pre-pandemic levels.
"As we continue to work with American Airlines to identify our flying needs this year, and in combination with recent attrition numbers for our Pilot group, we will be initiating hiring efforts for First Officer team members," Keith Stamper, vice president of PSA's air operations, said in a memo reviewed by Reuters.
A PSA spokeswoman confirmed the plans, which also include new flight attendant hiring, but said: "We are declining disclosing specific hiring numbers at this time."
For years, airlines including PSA were aggressively recruiting to address projected pilot shortages during an era of industry growth, but hiring and training programs were halted last year as the pandemic forced thousands of furloughs.
Dayton, Ohio-based PSA, which operates domestic routes for American, furloughed 723 pilots and 323 flight attendants last October when an initial COVID-19 relief plan for U.S. airlines expired. Employees were recalled last month following a fresh $15 billion in government aid for the struggling industry.
Major airlines like American rely on regional carriers, which have a cheaper workforce, to operate a large share of their domestic networks.
Over time, regional pilots work their way up to the majors, which are preparing for a wave of retirementsin coming years even after many pilots took early departure deals during the pandemic.
American, for example, expects over 11,149 pilots to reach the mandatory retirement age of 65 between 2021 and 2041, with 455 expected to retire this year alone, according to internal company projections updated on Jan. 18.
(Reporting by Tracy Rucinski, Editing by Mark Potter and Alistair Bell)
((tracy.rucinski@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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By Tracy Rucinski Jan 19 (Reuters) - American Airlines' AAL.O wholly-owned regional subsidiary PSA Airlines plans to resume new pilot hiring this year, a positive sign for an industry that was ravaged last year by the coronavirus pandemic but is now preparing to ramp up flying. As COVID-19 vaccines continue to roll out, airlines are hoping for a significant improvement in domestic air travel by the summer, even if demand does not fully yet recoup pre-pandemic levels. "As we continue to work with American Airlines to identify our flying needs this year, and in combination with recent attrition numbers for our Pilot group, we will be initiating hiring efforts for First Officer team members," Keith Stamper, vice president of PSA's air operations, said in a memo reviewed by Reuters.
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By Tracy Rucinski Jan 19 (Reuters) - American Airlines' AAL.O wholly-owned regional subsidiary PSA Airlines plans to resume new pilot hiring this year, a positive sign for an industry that was ravaged last year by the coronavirus pandemic but is now preparing to ramp up flying. For years, airlines including PSA were aggressively recruiting to address projected pilot shortages during an era of industry growth, but hiring and training programs were halted last year as the pandemic forced thousands of furloughs. Dayton, Ohio-based PSA, which operates domestic routes for American, furloughed 723 pilots and 323 flight attendants last October when an initial COVID-19 relief plan for U.S. airlines expired.
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By Tracy Rucinski Jan 19 (Reuters) - American Airlines' AAL.O wholly-owned regional subsidiary PSA Airlines plans to resume new pilot hiring this year, a positive sign for an industry that was ravaged last year by the coronavirus pandemic but is now preparing to ramp up flying. "As we continue to work with American Airlines to identify our flying needs this year, and in combination with recent attrition numbers for our Pilot group, we will be initiating hiring efforts for First Officer team members," Keith Stamper, vice president of PSA's air operations, said in a memo reviewed by Reuters. For years, airlines including PSA were aggressively recruiting to address projected pilot shortages during an era of industry growth, but hiring and training programs were halted last year as the pandemic forced thousands of furloughs.
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By Tracy Rucinski Jan 19 (Reuters) - American Airlines' AAL.O wholly-owned regional subsidiary PSA Airlines plans to resume new pilot hiring this year, a positive sign for an industry that was ravaged last year by the coronavirus pandemic but is now preparing to ramp up flying. As COVID-19 vaccines continue to roll out, airlines are hoping for a significant improvement in domestic air travel by the summer, even if demand does not fully yet recoup pre-pandemic levels. Over time, regional pilots work their way up to the majors, which are preparing for a wave of retirementsin coming years even after many pilots took early departure deals during the pandemic.
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4791.0
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2021-01-18 00:00:00 UTC
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New to the Stock Market? 3 Things to Know Before You Buy Airline Stocks
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AAL
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https://www.nasdaq.com/articles/new-to-the-stock-market-3-things-to-know-before-you-buy-airline-stocks-2021-01-18
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It's hard to find value on Wall Street right now, with indexes near all-time highs. But compared to the froth in a lot of sectors, airlines stocks look cheap.
There's good reason why these stocks haven't rallied along with the broader market, but does that mean investors should continue to avoid the sector?
Here are three things you need to consider before buying in.
Airline data by YCharts
1. The pandemic impact will linger for years
Airlines were among the sectors hardest hit by the COVID-19 pandemic, with travel demand evaporating as the virus spread around the globe. U.S. carriers saw revenue fall by more than 60% in 2020, and the industry only survived thanks to nearly $100 billion in government support and private fundraising.
We're in the early stages of a recovery, but it is going to take time for airlines to bounce back. Industry execs have said to expect it to take years for passenger volumes to return to pre-pandemic levels, and some prominent voices have questioned whether business travel will ever rebound. International demand figures to trail domestic as countries recover at different paces.
A lot of the biggest airlines, companies including Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), and American Airlines Group (NASDAQ: AAL), rely on business travel for the bulk of their profits and will need to dramatically revamp their operations if it doesn't return.
Even in the best-case scenario where conditions normalize quickly, the airlines are going to need years to pay down ballooning debt balances and repair other scars from the pandemic before they can focus on growth and expansion again.
Image source: Getty Images.
2. It is time to pick winners
That said, with the introduction of a vaccine we at least now know there is an end to the crisis in sight. Airline stocks mostly traded as a group for most of 2020, which made sense since pandemic-related worries didn't discriminate against any specific airline. The recovery is unlikely to be as even.
As mentioned above, the larger network airlines Delta, United, and American are more reliant on business travelers. They also tend to have higher costs. Delta is the safest bet among these airlines due to its strong position prior to the pandemic and the flexibility provided by its largely non-union workforce, while American came into the crisis with the most debt on its books and could need longer to recover.
United's network has long been the envy of the industry because of its focus on business and international customers, but that route structure will need to be adapted if the airline is to be an early beneficiary of a recovery.
On the other hand, Southwest Airlines (NYSE: LUV) has a long history of gaining market share during industry downturns and is already beginning to go on the offensive post-pandemic. Spirit Airlines (NYSE: SAVE) has an industry-low cost structure and its route network is already optimized for leisure travelers, and is likely to be among the first airlines to fully recover.
3. This remains a long-term growth story
Prior to the pandemic there were a lot of tailwinds pushing growth in the aviation industry. Over time, those forces should return.
A growing global middle class is increasingly looking to travel, and attracting investment, and business travel, to new corners of the globe. A generation of discounters has lowered the cost of travel, opening it to more consumers and establishing air travel as a primary source of transportation for a lot of trips.
COVID-19 has brought those trends to a halt, but it should be temporary. Plane maker Boeing dramatically decreased its 10-year delivery forecast due to the pandemic but kept its 20-year forecast intact, implying it sees a full recovery over time.
The opportunity for growth remains substantial. The International Air Transport Association forecasts total global passenger count will grow from 3.9 billion in 2019 to 8 billion by 2039, and said the number could be as high as 11 billion passengers in its most bullish scenario. Even in its bearish scenario where air travel is reduced post-pandemic and due to carbon taxes and other policy changes, the trade group still expects a near doubling in passenger volumes in 20 years.
The bottom line is, air travel is not going anywhere, and even if you are bullish on Zoom Video Communications and the like replacing some chunk of business travel, there should still be ample demand in the years to come.
Investor takeaway: Be cautious, but not afraid
I'm bullish on airlines, but it is an open question how long it will take for the bullish bet to pay off. For now, I'd expect an uneven recovery, with stocks pulled between optimistic and pessimistic pandemic news and the outlook for the broader economy.
It's highly unlikely we are going straight up from here.
For investors able to stomach turbulence and focus on the long term, it is a great time to start positions in some of the top names in the industry. Spirit looks like a good bet to be a winner over the next 12 months, and Southwest and Delta are the best candidates to buy and hold forever.
10 stocks we like better than Southwest Airlines
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Southwest Airlines wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool owns shares of and recommends Zoom Video Communications. The Motley Fool owns shares of Spirit Airlines. The Motley Fool recommends Delta Air Lines and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A lot of the biggest airlines, companies including Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), and American Airlines Group (NASDAQ: AAL), rely on business travel for the bulk of their profits and will need to dramatically revamp their operations if it doesn't return. Even in the best-case scenario where conditions normalize quickly, the airlines are going to need years to pay down ballooning debt balances and repair other scars from the pandemic before they can focus on growth and expansion again. Delta is the safest bet among these airlines due to its strong position prior to the pandemic and the flexibility provided by its largely non-union workforce, while American came into the crisis with the most debt on its books and could need longer to recover.
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A lot of the biggest airlines, companies including Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), and American Airlines Group (NASDAQ: AAL), rely on business travel for the bulk of their profits and will need to dramatically revamp their operations if it doesn't return. The Motley Fool owns shares of and recommends Zoom Video Communications. The Motley Fool recommends Delta Air Lines and Southwest Airlines.
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A lot of the biggest airlines, companies including Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), and American Airlines Group (NASDAQ: AAL), rely on business travel for the bulk of their profits and will need to dramatically revamp their operations if it doesn't return. Spirit Airlines (NYSE: SAVE) has an industry-low cost structure and its route network is already optimized for leisure travelers, and is likely to be among the first airlines to fully recover. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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A lot of the biggest airlines, companies including Delta Air Lines (NYSE: DAL), United Airlines Holdings (NASDAQ: UAL), and American Airlines Group (NASDAQ: AAL), rely on business travel for the bulk of their profits and will need to dramatically revamp their operations if it doesn't return. The bottom line is, air travel is not going anywhere, and even if you are bullish on Zoom Video Communications and the like replacing some chunk of business travel, there should still be ample demand in the years to come. That's right -- they think these 10 stocks are even better buys.
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4792.0
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2021-01-18 00:00:00 UTC
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Don’t Take a Flier on American Airlines Shares
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AAL
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https://www.nasdaq.com/articles/dont-take-a-flier-on-american-airlines-shares-2021-01-18
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
The shares in American Airlines Group (NASDAQ:AAL) have been gaining altitude lately, along with other operators in the sector like United Airlines Holdings (NASDAQ:UAL), JetBlue Airways (NASDAQ:JBLU) and Delta Air Lines (NYSE:DAL). The rally for AAL stock began in late October when the price was $11. As of now, the shares are trading around $15.80 and the market capitalization is at $9.5 billion.
AAL) airplane waiting on the tarmac. Represents airline stocks." width="300" height="169">
Source: GagliardiPhotography / Shutterstock.com
Now AAL stock is still way off its 52-week high of $30. But then again, the recent rally is certainly encouraging.
The main reason for this? Of course, it’s about the innovative novel coronavirus vaccines from companies like Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA). The effectiveness rates have been proven to be much better than expected. There are also minimal side effects.
It’s true that the roll out has been disappointing. But during the past week, there are signs that things have been improving. The incoming Biden Administration also has an ambitious program for vaccine distribution. Thus, by the summer, the world economy may get back to some type of normalcy – which is certainly good news for AAL stock.
In the meantime, the company has been streamlining its operations. There is also the boost from the government assistance as well as the $900 billon fiscal stimulus.
The 7 Best Growth Stocks to Snap Up for 2021
So yes, all this is very good. But for investors looking at AAL stock, I actually still think there should be some caution. For the most part, the rally may have been overdone.
Let’s see why.
The Issues
The next quarter could be challenging for American Airlines. While December air traffic hit the highest levels since the start of the Covid-19 pandemic, there has been leveling off. Unfortunately, the death rates and hospitalizations continued to rise. And this is likely to lead to depressed demand for travel.
Investors may see the drop-off as temporary and continue to buy AAL stock. But there is another nagging issue as well: business travel, which is a big source of revenue for the company.
Even with the vaccines, there could be several years of lower activity for this segment. Let’s face it, with the wide-scale adoption of technologies like Zoom (NASDAQ:ZM), businesses adapted to adapt to far less business travel. Besides, it seems unlikely that conventions and conferences will make a comeback this year because of the need for long-range planning. According to a Bank of America (NYSE:BAC) survey of 25,000 business travelers, about half of the respondents indicated that the vaccines would not be a factor in improving business travel. In fact, only 14% said they would increase travel.
Rather, it seems that those airlines that have large vacation and leisure travel businesses will likely do much better. Examples include Southwest Airlines (NYSE:LUV) and Allegiant Travel (NASDAQ:ALGT).
Another issue for AAL stock is that it’s financials are dicey. The debt load is a hefty $47.5 billion and the cash balance is $8.3 billion. The company also announced in December that the fourth quarter is likely to see cash burn at the higher end of the range of $25 million to $30 million.
Bottom Line on AAL Stock
The management team at American Airlines has definitely gone a great job. There have been a major restructuring and cost cuts. There also has been a streaming of operations to adjust to the lower traffic.
But again, in terms of AAL stock, it seems like investors have been over eager. The rebound will likely be choppy and underperform expectations.
Interestingly enough, Wall Street analysts are fairly glum on the prospects for AAL. Consider that the price target is $11.58, which assumes 26% downside from current levels. In other words, there appears to be considerable risk with this stock.
On the date of publication, Tom Taulli did not have (either directly or indirectly) any positions in any of the securities mentioned in this article.
Tom Taulli (@ttaulli) is the author of various books on investing and technology, including Artificial Intelligence Basics, High-Profit IPO Strategies and All About Short Selling. He is also the author of courses on topics like the Python language and COBOL.
The post Don’t Take a Flier on American Airlines Shares appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Thus, by the summer, the world economy may get back to some type of normalcy – which is certainly good news for AAL stock. InvestorPlace - Stock Market News, Stock Advice & Trading Tips The shares in American Airlines Group (NASDAQ:AAL) have been gaining altitude lately, along with other operators in the sector like United Airlines Holdings (NASDAQ:UAL), JetBlue Airways (NASDAQ:JBLU) and Delta Air Lines (NYSE:DAL). The rally for AAL stock began in late October when the price was $11.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips The shares in American Airlines Group (NASDAQ:AAL) have been gaining altitude lately, along with other operators in the sector like United Airlines Holdings (NASDAQ:UAL), JetBlue Airways (NASDAQ:JBLU) and Delta Air Lines (NYSE:DAL). The rally for AAL stock began in late October when the price was $11. AAL) airplane waiting on the tarmac.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips The shares in American Airlines Group (NASDAQ:AAL) have been gaining altitude lately, along with other operators in the sector like United Airlines Holdings (NASDAQ:UAL), JetBlue Airways (NASDAQ:JBLU) and Delta Air Lines (NYSE:DAL). Bottom Line on AAL Stock The management team at American Airlines has definitely gone a great job. The rally for AAL stock began in late October when the price was $11.
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips The shares in American Airlines Group (NASDAQ:AAL) have been gaining altitude lately, along with other operators in the sector like United Airlines Holdings (NASDAQ:UAL), JetBlue Airways (NASDAQ:JBLU) and Delta Air Lines (NYSE:DAL). The rally for AAL stock began in late October when the price was $11. AAL) airplane waiting on the tarmac.
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4793.0
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2021-01-16 00:00:00 UTC
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American Airlines and JetBlue Get DOT Clearance for Northeast Alliance
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AAL
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https://www.nasdaq.com/articles/american-airlines-and-jetblue-get-dot-clearance-for-northeast-alliance-2021-01-16
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Last July, American Airlines (NASDAQ: AAL) and JetBlue Airways (NASDAQ: JBLU) announced plans to team up through a new alliance covering New York and Boston. Earlier this week, the U.S. Department of Transportation (DOT) closed its review of the proposed alliance. The DOT will allow the partnership to go forward in exchange for several key concessions and commitments by American and JetBlue. Let's take a look.
A new level of cooperation
American Airlines and JetBlue are planning for a level of cooperation that is unprecedented among major U.S. airlines (excluding mergers, of course). When they initially announced the partnership last year, American and JetBlue pointed to codesharing, slot swaps at New York's LaGuardia and JFK Airports, and reciprocal frequent-flyer benefits as some advantages of teaming up. These forms of cooperation are all tried and true in the domestic market, but have limited benefits.
Image source: American Airlines and JetBlue Airways.
The DOT agreement reveals that the two airlines plan to go a step further, though, by actively coordinating their schedules on routes to and from New York and Boston. That will allow them to offer more connecting opportunities and provide better time-of-day coverage on routes they both serve today.
This level of cooperation is common within international joint ventures. However, it represents a potential antitrust violation. As a result, American Airlines and JetBlue had to seek the DOT's blessing. Essentially, they had to convince regulators that the deal's consumer benefits would outweigh any harms. This became particularly critical after rivals Spirit Airlines and Southwest Airlines objected to the proposed partnership.
The DOT strikes a deal
Since announcing the alliance six months ago, American Airlines and JetBlue have said that the agreement would allow them to grow in New York and Boston and offer their respective customers access to more flights and destinations on a nonstop basis. But in order to gain DOT approval, the airlines had to turn those plans into clear commitments.
First, American Airlines and JetBlue will have to divest seven slot pairs at JFK Airport (four from American and three from JetBlue). They will be sold in a single block to a new permanent owner. Additionally, they will have to lease out six slot pairs at Reagan Airport near Washington, D.C. (four belonging to American and two belonging to JetBlue). American and JetBlue could potentially reclaim the Reagan Airport slots in the future, though, if they unwind their Northeast alliance.
Second, American Airlines and JetBlue are forbidden from discussing pricing or revenue management strategies or attempting to influence each other's competitive behavior. They may not discuss scheduling or capacity decisions for any route outside the scope of the alliance, either. (This is to ensure they remain robust competitors in other markets, such as South Florida.) Lawyers will be required to supervise all joint planning meetings to ensure that the two companies discuss only permitted topics.
Image source: JetBlue Airways.
Third, JetBlue agreed not to exit any markets it served year-round from JFK as of last February, with a few minor exceptions.
Fourth, American Airlines and JetBlue will be required to divest additional slots at JFK if they fail to meet specified growth targets in New York. Essentially, the carriers are committing to expand their combined seat capacity at JFK and LaGuardia Airports to at least 115% of pre-pandemic levels by 2025. Reporting requirements will allow the DOT to monitor the two airlines' compliance with their commitments.
Everyone wins -- if all goes to plan
It remains to be seen whether American Airlines and JetBlue can forge a good working relationship, particularly when they will remain fierce competitors in markets outside the scope of the new alliance. But the partnership has great promise if they can cooperate effectively.
For American Airlines, the partnership will provide its existing customers in New York and Boston far more nonstop flight options. (JetBlue currently has a much bigger footprint in both cities than American.) JetBlue can also supply a substantial volume of connecting traffic to support American's international routes at JFK, including new service that will launch in 2021 and beyond.
Meanwhile, JetBlue will be able to give its customers instant access to American's global route network. It will also gain access to a substantial number of slots at LaGuardia (and, to a lesser extent, JFK), enabling growth that wasn't possible previously. American Airlines hasn't fully utilized its slots in New York in recent years, and it has used inefficient single-class 44-seat and 50-seat jets on many regional routes from LaGuardia and JFK.
Consumers should win, too. American Airlines plans to withdraw all of its 44- and 50-seat jets from the New York market by the end of 2021. It will replace them with larger, more comfortable jets that include first class sections. Plus, as American and JetBlue consolidate frequencies on routes they both serve, they will be able to launch new routes from New York. Lastly, their commitment to increase seat capacity significantly by 2025 should help hold fares down over the next few years.
10 stocks we like better than JetBlue Airways
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and JetBlue Airways wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Adam Levine-Weinberg owns shares of JetBlue Airways and Spirit Airlines and is long January 2022 $10 calls on JetBlue Airways. The Motley Fool owns shares of Spirit Airlines. The Motley Fool recommends JetBlue Airways and Southwest Airlines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Last July, American Airlines (NASDAQ: AAL) and JetBlue Airways (NASDAQ: JBLU) announced plans to team up through a new alliance covering New York and Boston. When they initially announced the partnership last year, American and JetBlue pointed to codesharing, slot swaps at New York's LaGuardia and JFK Airports, and reciprocal frequent-flyer benefits as some advantages of teaming up. The DOT strikes a deal Since announcing the alliance six months ago, American Airlines and JetBlue have said that the agreement would allow them to grow in New York and Boston and offer their respective customers access to more flights and destinations on a nonstop basis.
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Last July, American Airlines (NASDAQ: AAL) and JetBlue Airways (NASDAQ: JBLU) announced plans to team up through a new alliance covering New York and Boston. Image source: American Airlines and JetBlue Airways. The Motley Fool owns shares of Spirit Airlines.
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Last July, American Airlines (NASDAQ: AAL) and JetBlue Airways (NASDAQ: JBLU) announced plans to team up through a new alliance covering New York and Boston. A new level of cooperation American Airlines and JetBlue are planning for a level of cooperation that is unprecedented among major U.S. airlines (excluding mergers, of course). First, American Airlines and JetBlue will have to divest seven slot pairs at JFK Airport (four from American and three from JetBlue).
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Last July, American Airlines (NASDAQ: AAL) and JetBlue Airways (NASDAQ: JBLU) announced plans to team up through a new alliance covering New York and Boston. First, American Airlines and JetBlue will have to divest seven slot pairs at JFK Airport (four from American and three from JetBlue). Plus, as American and JetBlue consolidate frequencies on routes they both serve, they will be able to launch new routes from New York.
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4794.0
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2021-01-15 00:00:00 UTC
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U.S. Treasury starts distributing $15 bln in payroll aid to airlines
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AAL
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https://www.nasdaq.com/articles/u.s.-treasury-starts-distributing-%2415-bln-in-payroll-aid-to-airlines-2021-01-15
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nan
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nan
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By David Shepardson
WASHINGTON, Jan 15 (Reuters) - The U.S. Treasury Department on Friday began distributing $15 billion in new payroll assistance to airlines, money allocated by Congressto help more than 32,000 aviation workers return to jobs through at least March 31.
Large airlines receiving assistance must repay 30% of it to the government in 10-year, low-interest loans. They must also issue warrants to the government as part of the assistance and must agree to extend restrictions on executive compensation and a ban on paying dividends and share repurchases through March 2022.
Delta Air Lines DAL.N said it expects to receive $2.9 billion in total aid this round, with $830 million in the form of an unsecured loan. The airline said it received the first installment of $1.4 billion on Friday.
Southwest Airlines LUV.N said it expected to receive $1.73 billion in total and received $863.7 million on Friday.
The warrants are priced at each airline's share closing prices on Dec. 24.
Congress approved a separate $25 billion in payroll assistance in March.
A Treasury spokeswoman did not immediately comment.
SkyWest Inc SKYW.O said it will receive $233 million in total under the program and received half on Friday.
Last month, American Airlines AAL.O and United Airlines UAL.O announced they were recalling tens of thousands of furloughed employees.
American and United together furloughed more than 32,000 workers in October. The new assistance will keep those workers on payrolls through March 31.
Neither airline on Friday immediately disclosed how much they expected to receive from Treasury.
(Reporting by David Shepardson Editing by Chris Reese and David Gregorio)
((David.Shepardson@thomsonreuters.com; 2028988324;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Last month, American Airlines AAL.O and United Airlines UAL.O announced they were recalling tens of thousands of furloughed employees. By David Shepardson WASHINGTON, Jan 15 (Reuters) - The U.S. Treasury Department on Friday began distributing $15 billion in new payroll assistance to airlines, money allocated by Congressto help more than 32,000 aviation workers return to jobs through at least March 31. They must also issue warrants to the government as part of the assistance and must agree to extend restrictions on executive compensation and a ban on paying dividends and share repurchases through March 2022.
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Last month, American Airlines AAL.O and United Airlines UAL.O announced they were recalling tens of thousands of furloughed employees. Large airlines receiving assistance must repay 30% of it to the government in 10-year, low-interest loans. Southwest Airlines LUV.N said it expected to receive $1.73 billion in total and received $863.7 million on Friday.
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Last month, American Airlines AAL.O and United Airlines UAL.O announced they were recalling tens of thousands of furloughed employees. By David Shepardson WASHINGTON, Jan 15 (Reuters) - The U.S. Treasury Department on Friday began distributing $15 billion in new payroll assistance to airlines, money allocated by Congressto help more than 32,000 aviation workers return to jobs through at least March 31. Southwest Airlines LUV.N said it expected to receive $1.73 billion in total and received $863.7 million on Friday.
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Last month, American Airlines AAL.O and United Airlines UAL.O announced they were recalling tens of thousands of furloughed employees. By David Shepardson WASHINGTON, Jan 15 (Reuters) - The U.S. Treasury Department on Friday began distributing $15 billion in new payroll assistance to airlines, money allocated by Congressto help more than 32,000 aviation workers return to jobs through at least March 31. They must also issue warrants to the government as part of the assistance and must agree to extend restrictions on executive compensation and a ban on paying dividends and share repurchases through March 2022.
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4795.0
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2021-01-15 00:00:00 UTC
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Colombian coal miner Drummond production, exports fell in 2020
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AAL
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https://www.nasdaq.com/articles/colombian-coal-miner-drummond-production-exports-fell-in-2020-2021-01-15
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nan
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nan
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BOGOTA, Jan 15 (Reuters) - Colombian coal producer Drummond saw production and exports fall 10.3% and 4.4% respectively in 2020, the company said on Friday, amid difficulties caused by the coronavirus pandemic.
The coal miner produced 29.3 million tonnes of coal last year, compared with 32.6 million tonnes in 2019. Exports fell to 29.7 million tonnes, down from 31.1 million tonnes in the prior year.
"We recognize that this was not an easy year," Drummond Chief Executive Officer Jose Miguel Linares said in a statement. "We overcame huge challenges amid a difficult market environment and a health crisis that hit the whole world."
Drummond announced its decision to significantly reduce operations in late March due to the coronavirus pandemic, before restarting some of its operations in April.
Earlier this week Cerrejon, another Colombian coal miner owned equally by BHP Group BHP.AX, Anglo American AAL.L and Glencore GLEN.L, reported 2020 production levels down almost 52% on 2019, while exports declined 48.2%.
Going into 2021 Drummond will focus on working to support the Colombian economy, Linares said.
Drummond operates the Pribbenow and El Descanso mines, located in the Cesar province, in northern Colombia.
(Reporting by Luis Jaime Acosta and Oliver Griffin, Editing by Franklin Paul)
((Oliver.Griffin@thomsonreuters.com; +57 304-583-8931;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Earlier this week Cerrejon, another Colombian coal miner owned equally by BHP Group BHP.AX, Anglo American AAL.L and Glencore GLEN.L, reported 2020 production levels down almost 52% on 2019, while exports declined 48.2%. BOGOTA, Jan 15 (Reuters) - Colombian coal producer Drummond saw production and exports fall 10.3% and 4.4% respectively in 2020, the company said on Friday, amid difficulties caused by the coronavirus pandemic. "We overcame huge challenges amid a difficult market environment and a health crisis that hit the whole world."
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Earlier this week Cerrejon, another Colombian coal miner owned equally by BHP Group BHP.AX, Anglo American AAL.L and Glencore GLEN.L, reported 2020 production levels down almost 52% on 2019, while exports declined 48.2%. BOGOTA, Jan 15 (Reuters) - Colombian coal producer Drummond saw production and exports fall 10.3% and 4.4% respectively in 2020, the company said on Friday, amid difficulties caused by the coronavirus pandemic. The coal miner produced 29.3 million tonnes of coal last year, compared with 32.6 million tonnes in 2019.
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Earlier this week Cerrejon, another Colombian coal miner owned equally by BHP Group BHP.AX, Anglo American AAL.L and Glencore GLEN.L, reported 2020 production levels down almost 52% on 2019, while exports declined 48.2%. BOGOTA, Jan 15 (Reuters) - Colombian coal producer Drummond saw production and exports fall 10.3% and 4.4% respectively in 2020, the company said on Friday, amid difficulties caused by the coronavirus pandemic. The coal miner produced 29.3 million tonnes of coal last year, compared with 32.6 million tonnes in 2019.
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Earlier this week Cerrejon, another Colombian coal miner owned equally by BHP Group BHP.AX, Anglo American AAL.L and Glencore GLEN.L, reported 2020 production levels down almost 52% on 2019, while exports declined 48.2%. BOGOTA, Jan 15 (Reuters) - Colombian coal producer Drummond saw production and exports fall 10.3% and 4.4% respectively in 2020, the company said on Friday, amid difficulties caused by the coronavirus pandemic. The coal miner produced 29.3 million tonnes of coal last year, compared with 32.6 million tonnes in 2019.
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4796.0
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2021-01-15 00:00:00 UTC
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Thinking of Buying Airline Stocks? Buy These Travel Stocks Instead
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AAL
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https://www.nasdaq.com/articles/thinking-of-buying-airline-stocks-buy-these-travel-stocks-instead-2021-01-15
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nan
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nan
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It's a new year and investors are looking ahead to the coronavirus recovery.
Stocks that were hit hard last year have already started bouncing higher this year, including those in banking and energy, as investors anticipate another stimulus package from the incoming Biden administration.
Airline stocks were crushed last year: All of the four major airlines except Southwest Airlines (NYSE: LUV) lost more than 30%. With Delta Air Lines (NYSE: DAL) set to kick off earnings season on Thursday, investor attention is turning to the sector again. While air passenger traffic increased in the fourth quarter according to the TSA, especially around the holidays, it was still down by more than 50% for the period, and airlines are likely to face stiff headwinds at least through the current quarter as COVID-19 cases are near their peaks in the U.S.
Additionally, airlines have high fixed costs, and all four of the major carriers, which also include American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL), have seen their debt burdens grow significantly during the pandemic, meaning they will face headwinds from increased interest payments even after the crisis ends. There are real questions whether business travel, a key source of demand, will return now that remote work options like Zoom Video Communications have proven to be viable.
For investors looking to airlines for a piece of the recovery economy, there are some better options elsewhere in the travel sector. Keep reading to see why Airbnb (NASDAQ: ABNB), TripAdvisor (NASDAQ: TRIP), and Trivago (NASDAQ: TRVG) fit the bill.
Image source: Getty Images.
1. Airbnb
Airbnb's competitive advantages are manifest. The company is by far the biggest vacation rental website, an industry that it pioneered and with which its name is synonymous. The company has weathered the pandemic better than most online travel agencies as its business gives it a level of flexibility that hotel platforms don't have. Though bookings are still down significantly at Airbnb, it has outperformed online travel agencies (OTAs) like Booking Holdings because of its ability to cater to shifting demand for things like long-term stays and short-distance travel outside of cities. The company also laid off about 25% of its workforce, which will greatly improve its cost structure and bottom line when the underlying business recovers.
Airbnb has less exposure to business travel than hotels and airlines do, making it better positioned for a surge in vacation demand, which is likely to come once it's safe to travel again. Additionally, the company has rooms all around the world and at a wide range of price points, giving travelers a multitude of options. While the stock may look expensive following its post-IPO run, a post-pandemic resurgence would almost certainly push the stock higher and strengthen its competitive advantages in the travel industry.
2. TripAdvisor
The recovery in TripAdvisor shares has already begun as the stock is up 75% since Pfizer and BioNTech announced successful phase 3 vaccine trials in November, but that doesn't mean it's too late to hop on the bandwagon. As a travel-related advertising business, TripAdvisor may have more upside than any other travel stock as advertising demand is especially sensitive. Shares plunged as the pandemic hit, but the company is likely to see strong demand from hotels, restaurants, experiences, and other travel-related businesses once tourism picks up again.
Unlike businesses like airlines, TripAdvisor's fixed costs are low as most of its expenses come from its employees and sales and marketing to drive traffic to its site. Like Airbnb, TripAdvisor laid off about a quarter of its staff in the spring, which should help pad its bottom line when the pandemic ends.
The company also said in its last earnings call that it was planning to roll out a direct-to-consumer subscription service, dubbed TripAdvisor Plus, that will offer consumers discounts on hotels and travel attractions. That could be a catalyst for the company's recovery, especially as travel demand is poised to spike. Meanwhile, hotels, restaurants and other travel destinations will be eager to get customers back in their doors and will look to platforms like TripAdvisor to drive that traffic.
3. Trivago
Hotel metasearch platform Trivago has seen demand dive during the pandemic, but the company has handled the challenges adeptly, scaling back on marketing costs, shuttering regional offices, laying off staff to save costs, and rolling out new features like local search and discovery to help travelers find a destination when they don't know where they want to go.
As a result of those efforts, the company managed to report positive adjusted EBITDA in the third quarter even though revenue fell 76%. The company relies on search traffic from Booking and Expedia Group, but demand from the leading OTAs should bounce back once the pandemic ends, and Google, which has been a threat to Trivago and the broader travel industry, may have been chastened by recent antitrust investigations.
The stock has recouped most of its 2020 losses, but it still looks cheap, trading at a price-to-sales ratio of less than one based on 2019 revenue. Like TripAdvisor, Trivago's fixed costs are minimal, and it can easily flex advertising up and down according to demand, which should help the company make a quick recovery when the pandemic fades.
10 stocks we like better than TripAdvisor
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and TripAdvisor wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Jeremy Bowman owns shares of Airbnb, Inc. and Zoom Video Communications. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Booking Holdings, TripAdvisor, and Zoom Video Communications. The Motley Fool recommends Delta Air Lines, Southwest Airlines, and Trivago. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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While air passenger traffic increased in the fourth quarter according to the TSA, especially around the holidays, it was still down by more than 50% for the period, and airlines are likely to face stiff headwinds at least through the current quarter as COVID-19 cases are near their peaks in the U.S. Additionally, airlines have high fixed costs, and all four of the major carriers, which also include American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL), have seen their debt burdens grow significantly during the pandemic, meaning they will face headwinds from increased interest payments even after the crisis ends. There are real questions whether business travel, a key source of demand, will return now that remote work options like Zoom Video Communications have proven to be viable. The company also said in its last earnings call that it was planning to roll out a direct-to-consumer subscription service, dubbed TripAdvisor Plus, that will offer consumers discounts on hotels and travel attractions.
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While air passenger traffic increased in the fourth quarter according to the TSA, especially around the holidays, it was still down by more than 50% for the period, and airlines are likely to face stiff headwinds at least through the current quarter as COVID-19 cases are near their peaks in the U.S. Additionally, airlines have high fixed costs, and all four of the major carriers, which also include American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL), have seen their debt burdens grow significantly during the pandemic, meaning they will face headwinds from increased interest payments even after the crisis ends. The company relies on search traffic from Booking and Expedia Group, but demand from the leading OTAs should bounce back once the pandemic ends, and Google, which has been a threat to Trivago and the broader travel industry, may have been chastened by recent antitrust investigations. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Booking Holdings, TripAdvisor, and Zoom Video Communications.
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While air passenger traffic increased in the fourth quarter according to the TSA, especially around the holidays, it was still down by more than 50% for the period, and airlines are likely to face stiff headwinds at least through the current quarter as COVID-19 cases are near their peaks in the U.S. Additionally, airlines have high fixed costs, and all four of the major carriers, which also include American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL), have seen their debt burdens grow significantly during the pandemic, meaning they will face headwinds from increased interest payments even after the crisis ends. Airbnb has less exposure to business travel than hotels and airlines do, making it better positioned for a surge in vacation demand, which is likely to come once it's safe to travel again. Trivago Hotel metasearch platform Trivago has seen demand dive during the pandemic, but the company has handled the challenges adeptly, scaling back on marketing costs, shuttering regional offices, laying off staff to save costs, and rolling out new features like local search and discovery to help travelers find a destination when they don't know where they want to go.
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While air passenger traffic increased in the fourth quarter according to the TSA, especially around the holidays, it was still down by more than 50% for the period, and airlines are likely to face stiff headwinds at least through the current quarter as COVID-19 cases are near their peaks in the U.S. Additionally, airlines have high fixed costs, and all four of the major carriers, which also include American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL), have seen their debt burdens grow significantly during the pandemic, meaning they will face headwinds from increased interest payments even after the crisis ends. For investors looking to airlines for a piece of the recovery economy, there are some better options elsewhere in the travel sector. Airbnb has less exposure to business travel than hotels and airlines do, making it better positioned for a surge in vacation demand, which is likely to come once it's safe to travel again.
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4797.0
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2021-01-14 00:00:00 UTC
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Why Airline Shares Are Up Today
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AAL
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https://www.nasdaq.com/articles/why-airline-shares-are-up-today-2021-01-14
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nan
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nan
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What happened
Delta Air Lines (NYSE: DAL) kicked off airline earnings season with predictably miserable results. But the company also predicted better days ahead, and that has airlines flying higher on Thursday.
Shares of Delta peaked at up more than 5% in Thursday-morning trading, while shares of Spirit Airlines (NYSE: SAVE) climbed as much as 8% and shares of American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) each were up more than 5%.
So what
The pandemic wreaked havoc on the airlines in 2020, and Delta's year-end results demonstrated what a miserable year it was for the industry. Delta lost $2.1 billion in the fourth quarter and $15.6 billion for the year, posting a mind-bogglingly bad negative 91% margin for the year.
Delta continues to lose money and expects to burn through between $10 million and $15 million per day in the current quarter. But management on the postearnings call was generally upbeat in its outlook for 2021. CEO Ed Bastian said the airline expects an "inflection point" in the recovery this spring, with hopes of reaching cash breakeven by then and perhaps becoming profitable by summer.
Image source: Delta Air Lines.
Bastian also said he expects corporate travel to return "aggressively" by as soon as the second half of 2021, raising hopes that the business will begin to normalize as the year goes on.
Given that the pandemic affected all airlines, investors are applying Delta's commentary on a recovery to its rivals as well. Spirit has an industry-low cost structure and a focus on the leisure travelers who are likely to return first, and it should be one of the first airlines to fully recover.
American and United, meanwhile, are the two airlines most similar to Delta in terms of route structure. Some worry that their focus on international and business customers could make them laggards in a recovery, but Delta's messaging that it sees a return to normal coming sooner than some had feared is good news for American and United as well.
Now what
There are some caveats here that investors need to keep in mind. Bastian in the earnings statement called 2020 "the toughest year in Delta's history," but also warned that "challenges continue in 2021." The airline expects first-quarter revenue to be down 60% to 65% compared to a year ago, with scheduled flight capacity set to shrink by 35%.
More worrisomely, the company needs further booking improvement to reach its goal of cash breakeven. A lot of that will depend on how the vaccine rollout goes, and whether or not further travel restrictions or lockdowns are needed before we get there.
As I said coming into 2021, the worst appears to be over for the airlines. But the recovery will take time. Delta's earnings are a fresh signal that it is safe for investors to pile in, but I'd continue to recommend being choosy about what to buy and sticking with either companies like Delta that have a track record of strong results or companies like Spirit that have a near-term advantage that should push the stock higher in the quarters to come.
10 stocks we like better than Delta Air Lines
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Delta Air Lines wasn't one of them! That's right -- they think these 10 stocks are even better buys.
See the 10 stocks
*Stock Advisor returns as of November 20, 2020
Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines. The Motley Fool owns shares of Spirit Airlines. The Motley Fool recommends Delta Air Lines. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Shares of Delta peaked at up more than 5% in Thursday-morning trading, while shares of Spirit Airlines (NYSE: SAVE) climbed as much as 8% and shares of American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) each were up more than 5%. What happened Delta Air Lines (NYSE: DAL) kicked off airline earnings season with predictably miserable results. CEO Ed Bastian said the airline expects an "inflection point" in the recovery this spring, with hopes of reaching cash breakeven by then and perhaps becoming profitable by summer.
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Shares of Delta peaked at up more than 5% in Thursday-morning trading, while shares of Spirit Airlines (NYSE: SAVE) climbed as much as 8% and shares of American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) each were up more than 5%. What happened Delta Air Lines (NYSE: DAL) kicked off airline earnings season with predictably miserable results. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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Shares of Delta peaked at up more than 5% in Thursday-morning trading, while shares of Spirit Airlines (NYSE: SAVE) climbed as much as 8% and shares of American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) each were up more than 5%. Delta's earnings are a fresh signal that it is safe for investors to pile in, but I'd continue to recommend being choosy about what to buy and sticking with either companies like Delta that have a track record of strong results or companies like Spirit that have a near-term advantage that should push the stock higher in the quarters to come. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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Shares of Delta peaked at up more than 5% in Thursday-morning trading, while shares of Spirit Airlines (NYSE: SAVE) climbed as much as 8% and shares of American Airlines Group (NASDAQ: AAL) and United Airlines Holdings (NASDAQ: UAL) each were up more than 5%. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Delta Air Lines wasn't one of them! See the 10 stocks *Stock Advisor returns as of November 20, 2020 Lou Whiteman owns shares of Delta Air Lines and Spirit Airlines.
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4798.0
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2021-01-14 00:00:00 UTC
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Pre-Market Most Active for Jan 14, 2021 : CCIV, FCEL, GME, NOK, UNVR, VZ, APHA, BABA, AAL, TLRY, INTC, NK
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AAL
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https://www.nasdaq.com/articles/pre-market-most-active-for-jan-14-2021-%3A-cciv-fcel-gme-nok-unvr-vz-apha-baba-aal-tlry-intc
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nan
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nan
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The NASDAQ 100 Pre-Market Indicator is up 20.25 to 12,993.88. The total Pre-Market volume is currently 22,121,026 shares traded.
The following are the most active stocks for the pre-market session:
Churchill Capital Corp IV (CCIV) is +1.49 at $18.21, with 4,985,978 shares traded., following a 52-week high recorded in prior regular session.
FuelCell Energy, Inc. (FCEL) is -1.37 at $17.77, with 2,247,277 shares traded., following a 52-week high recorded in prior regular session.
Gamestop Corporation (GME) is +5.49 at $36.89, with 2,089,925 shares traded., following a 52-week high recorded in prior regular session.
Nokia Corporation (NOK) is +0.1 at $4.08, with 1,202,446 shares traded. NOK's current last sale is 88.7% of the target price of $4.6.
Univar Solutions Inc. (UNVR) is unchanged at $20.71, with 1,143,116 shares traded. As reported by Zacks, the current mean recommendation for UNVR is in the "buy range".
Verizon Communications Inc. (VZ) is +0.07 at $57.13, with 985,063 shares traded. As reported by Zacks, the current mean recommendation for VZ is in the "buy range".
Aphria Inc. (APHA) is +0.76 at $10.76, with 947,945 shares traded. PR Newswire Reports: Aphria Inc. Announces Record Second Quarter Fiscal Year 2021 Results
Alibaba Group Holding Limited (BABA) is +7.05 at $242.35, with 945,118 shares traded. BABA's current last sale is 73.44% of the target price of $330.
American Airlines Group, Inc. (AAL) is +0.23 at $15.76, with 937,391 shares traded. AAL's current last sale is 140.09% of the target price of $11.25.
Tilray, Inc. (TLRY) is +0.52 at $15.54, with 826,386 shares traded. TLRY's current last sale is 155.4% of the target price of $10.
Intel Corporation (INTC) is +1.44 at $58.39, with 808,079 shares traded. INTC's current last sale is 104.27% of the target price of $56.
NantKwest, Inc. (NK) is +4.82 at $19.60, with 658,259 shares traded. NK's current last sale is 150.77% of the target price of $13.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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American Airlines Group, Inc. (AAL) is +0.23 at $15.76, with 937,391 shares traded. AAL's current last sale is 140.09% of the target price of $11.25. Churchill Capital Corp IV (CCIV) is +1.49 at $18.21, with 4,985,978 shares traded., following a 52-week high recorded in prior regular session.
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American Airlines Group, Inc. (AAL) is +0.23 at $15.76, with 937,391 shares traded. AAL's current last sale is 140.09% of the target price of $11.25. Churchill Capital Corp IV (CCIV) is +1.49 at $18.21, with 4,985,978 shares traded., following a 52-week high recorded in prior regular session.
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American Airlines Group, Inc. (AAL) is +0.23 at $15.76, with 937,391 shares traded. AAL's current last sale is 140.09% of the target price of $11.25. The total Pre-Market volume is currently 22,121,026 shares traded.
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American Airlines Group, Inc. (AAL) is +0.23 at $15.76, with 937,391 shares traded. AAL's current last sale is 140.09% of the target price of $11.25. Gamestop Corporation (GME) is +5.49 at $36.89, with 2,089,925 shares traded., following a 52-week high recorded in prior regular session.
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4799.0
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2021-01-14 00:00:00 UTC
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Travelers To U.S Required To Show Evidence Of Negative COVID-19 Test: American Airlines
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AAL
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https://www.nasdaq.com/articles/travelers-to-u.s-required-to-show-evidence-of-negative-covid-19-test%3A-american-airlines
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nan
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nan
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(RTTNews) - American Airlines Inc. said it will support the implementation by the U.S. authorities of a global program to require COVID-19 testing for passengers traveling to the United States.
Beginning January 26, the U.S. government will require all passengers two years of age and older traveling to the country from any international location to test negative for COVID-19 within three calendar days of departure.
American said it is working closely with U.S. authorities as it implements this new order.
The company will also take care of any affected customers by assisting them with rebooking options.
The company already offers preflight coronavirus testing in many destinations. The company had begun the testing for flights to some international routes in early October as it was preparing to open up international travel.
American Airlines, in partnership with LetsGetChecked, offers a convenient FDA EUA-authorized at-home COVID-19 testing option.
The company in November last year had launched an app that would help customers to streamline travel requirements due to COVID-19 restrictions.
American Airlines' mobile app, called VeriFLY, helps travelers easily understand coronavirus testing and documentation requirements for their destination.
After verifying that the traveler's data matches the country's requirements, the app displays either a pass or a fail message.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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(RTTNews) - American Airlines Inc. said it will support the implementation by the U.S. authorities of a global program to require COVID-19 testing for passengers traveling to the United States. Beginning January 26, the U.S. government will require all passengers two years of age and older traveling to the country from any international location to test negative for COVID-19 within three calendar days of departure. American Airlines' mobile app, called VeriFLY, helps travelers easily understand coronavirus testing and documentation requirements for their destination.
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(RTTNews) - American Airlines Inc. said it will support the implementation by the U.S. authorities of a global program to require COVID-19 testing for passengers traveling to the United States. The company already offers preflight coronavirus testing in many destinations. American Airlines' mobile app, called VeriFLY, helps travelers easily understand coronavirus testing and documentation requirements for their destination.
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(RTTNews) - American Airlines Inc. said it will support the implementation by the U.S. authorities of a global program to require COVID-19 testing for passengers traveling to the United States. Beginning January 26, the U.S. government will require all passengers two years of age and older traveling to the country from any international location to test negative for COVID-19 within three calendar days of departure. American Airlines' mobile app, called VeriFLY, helps travelers easily understand coronavirus testing and documentation requirements for their destination.
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(RTTNews) - American Airlines Inc. said it will support the implementation by the U.S. authorities of a global program to require COVID-19 testing for passengers traveling to the United States. Beginning January 26, the U.S. government will require all passengers two years of age and older traveling to the country from any international location to test negative for COVID-19 within three calendar days of departure. The company already offers preflight coronavirus testing in many destinations.
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