Shares of American Airlines parent company AMR (AMR) plunged today on news that pilots were accelerating their retirement plans, presumably on fears that their pensions could be at risk if the company goes into bankruptcy. AMR stock briefly fell about 40%, and trading was halted in the middle of the day. Shares are down 25% to $2.22.
“We are in a down market today but the exceptional number of American pilots retiring is a sign that they want to protect their pensions and get out before a possible filing further depressing the stock price,” wrote Maxim analyst Ray Neidl in an email.
The company said that bankruptcy is “not our goal or our preference,” but shareholders are clearly starting to factor that possibility into the stock price.
Other airline stocks also fell in midday trading after Citi analyst Will Randow downgraded both United Continental (UAL) and US Airways (LCC).
“We downgrade LCC to Sell and UAL to Hold on lower revenue estimates for the group on the heels of: (1) likely deceleration in late-Sept revenues; (2) Citi economists trimming 2012 global GDP to 2.9% YoY (was 3.2%) last week; and (3) evidence that some corporates are considering tightening travel coupled with related weak confidence/jobs numbers, which lead airline revenues.”
No comments:
Post a Comment