Dahlman Rose reiterates a 'Sell' on Pinnacle Airlines (NASDAQ: PNCL); Suggests Selling Into Any Strength

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PNCL Hot Sheet

Rating Summary:
0 Buy, 2 Hold, 2 Sell

Rating Trend:

Up

Today's Overall Ratings:
Up: 16 | Down: 9 | New: 26

Dahlman Rose reiterates a 'Sell' on Pinnacle Airlines (NASDAQ: PNCL) price target of $0.75.

Analyst, Helane Becker, said, "Pinnacle and United Continental (NYSE: UAL)(Buy, $27 PT) agreed to a short-term amendment in the current capacity purchase agreement (CPA)...Due to this amendment, we expect the stock to trade higher today. However the amendment to the contract is for February 1, 2012 to April 2, 2012, and does not change the fundamentals for the company. United represents ~25% of Pinnacle's revenues; the remaining 75% comes from Delta (NYSE: DAL), and they are also underwater on some of their Delta contracts. Pinnacle is trying to negotiate higher revenue reimbursement rates with Delta."

"Pinnacle has done an admirable job of shifting out near-term debt issues by asking for relief from its customers. Pinnacle's balance sheet continues to remain an issue, and we believe a Chapter 11 filling may be the most expedient way to turn the company around."

For an analyst ratings summary and ratings history on Pinnacle Airlines click here. For more ratings news on Pinnacle Airlines click here.

Shares of Pinnacle Airlines closed at $1.12 yesterday, with a 52 week range of $0.72-$7.48.

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