A March 6 recommendation from Jim Cramer on "Mad Money" has benefited the carrier, up 8% since the show aired. Cramer hadn't recommended an airline stock in years, but noted: "I hated the industry before but look at the last airline mergers -- I mean wow." He said the U.S. Justice Department is evaluating the US Airways/American merger just as it evaluated the US Airways/America West merger in 2005. "Once the waiting period ended and it turned out that the justice department was fine with that transaction in late June of that year, America West surged an astounding 54% over the following three months," Cramer said. "I want you in something like that."
As for Alaska, Wolfe Trahan analyst Hunter Keay on March 1 labeled it (along with Delta) a "best idea" and noted that "the airline underappreciated by investors despite the recent run in the stock, as evidenced by its oddly discounted multiple(s) to peers." Alaska has risen 7% since the recommendation two weeks ago.
Spirit is benefiting from a Cramer recommendation on "Mad Money" on Wednesday. Spirit is trading at 11 times earnings, Cramer said, noting: "I think it has more room to run." During the show, Spirit CEO Ben Baldanza told Cramer: "It's unfortunate that in the airline industry we have to remind people that we are a business."
Evidently, this time investors are not dismissing those reminders.
-- Written by Ted Reed in Charlotte, N.C.
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