Analyst Stephen Trent of Citi maintained a Hold rating on JetBlue Airways (JBLU – Research Report), with a price target of $5.50.
Stephen Trent has given his Hold rating due to a combination of factors affecting JetBlue Airways’s financial outlook. The airline has provided an investor update indicating a slightly improved revenue forecast for the first quarter, with a smaller year-over-year decrease than previously anticipated. Moreover, while the company is still not expected to be profitable in the first quarter, the projected loss is less than earlier estimates. Additionally, JetBlue’s non-fuel operating costs are expected to rise, yet this increase is at a slower pace than initially forecasted, which may suggest some degree of cost control.
Despite these modest improvements, there are still concerns that merit caution. JetBlue’s fuel costs are projected to be slightly higher than Citi’s estimates, which could impact profitability. There is also a significant increase in capital expenditure forecasted for the first quarter, although the full-year capex remains unchanged. These factors, combined with an expected share price return that is negative, contribute to Trent’s Neutral/High Risk rating, implying that while there are some positive adjustments, the overall financial health of JetBlue Airways warrants a wait-and-see approach before making further investment recommendations.
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JetBlue Airways (JBLU) Company Description:
JetBlue Airways Corp. provides air transportation services. It carries more than 30 million customers a year to 86 cities in the U.S., Caribbean, and Latin America with an average of 850 daily flights. The company offers flights and tickets to more than 82 destinations, with accommodations such as free TV, free snacks, and most legroom. JetBlue Airways was founded by David Gary Neeleman in August, 1998 and is headquartered in Long Island City, NY.
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