UPDATE: JetBlue Airways (JBLU) PT Lowered to $20 at Stifel, Following Weak CASM Guidance

July 27, 2021 3:58 PM EDT
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Price: $15.22 --0%

Rating Summary:
    13 Buy, 12 Hold, 2 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 7 | Down: 3 | New: 10
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(Updated - July 28, 2021 7:29 AM EDT)

Stifel analyst Joseph W. DeNardi lowered the price target on JetBlue Airways (NASDAQ: JBLU) to $20.00 (from $21.00) after the company reported adjusted 2Q EPS of -$0.65, four cents ahead of expectations on tailwinds from the renewed co-brand agreement with Barclays/Mastercard (1.5pts of revenue for 2Q, 1pt of revenue/margins for FY). Revenue guidance of down 4-9% vs. 2019 was better than expectations of down ~18% and is better than Alaska (-17-20%) and Southwest (-10-15%
July; -12-17% August). The difference is likely attributable to a combination of capacity nearing
flat to 2019 (inline with Southwest but well ahead of Alaska) and greater exposure to Latin/
Caribbean leisure markets.

The key concern for the quarter was CASMx guidance of +11-13% (3Q) and low-single digits (FY22)
vs. 2019 was materially worse than expectation for ~+4% and flattish, respectively, on
short-term headwinds from rents/landing fees/labor/maintenance/NE Alliance and longer-term
pressures from delayed E190 retirements/NE Alliance investments. the analyst maintained a a Hold rating, stating "This is challenging JetBlue's ability to return to positive EPS in the near term and is overshadowing the revenue recovery, in our view".

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