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Airline stocks show notable weakness in early trading despite oil prices moving in the right...

Airline stocks show notable weakness in early trading despite oil prices moving in the right direction. Traders lament the possibility that a slumping global economy could thwart growth in business travel. Decliners: DAL -6.3%, UAL -4.1%, LCC -4.1%, JBLU -2.4%.
Comments (2)
  • Tony Petroski
    , contributor
    Comments (6373) | Send Message
     
    "Traders lament the possibility that a slumping global economy could thwart growth in business travel."

     

    True enough. The real question, however, is why did those traders choose this morning to begin lamenting?
    4 Jun 2012, 10:44 AM Reply Like
  • markcc
    , contributor
    Comments (788) | Send Message
     
    with fuel prices plummeting, and loading factors in the mid-80s, these stocks should be flying... It is clearly contrarian that the whole group is moving down. Is this a fake move? Even the smallest airlines like JetBlue will reap $200-300 million in savings due to lowered fuel expenses if the oil prices stay where they are. on a per share basis this could be a dollar per share, on a $5 stock, in addition to the .52 they were expected to make this year. This stock is therefore selling for 3-4 times this years earnings! Somebody is working this stock to keep it down.
    4 Jun 2012, 11:44 AM Reply Like
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