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JetBlue Airways Corp. (JBLU) - Get JetBlue Airways Corporation Report said it would reduce planned capacity growth because of air traffic control delays at New York's John F. Kennedy International Airport and Boston Logan International Airport, a move that pleased analysts but didn't make much of an impression on shareholders.

Early Wednesday, July 26, the carrier got a downgrade from Buckingham Research analyst Dan McKenzie, who cut his rating to neutral from buy and cut his price target to $24 from $28. His report was titled "Good but Fully Valued Story."

In premarket trading, JetBlue shares were down about 1%.

JetBlue shares closed Tuesday at $22.77, up one cent. Year to date, shares have risen about 2%. Among the eight major airlines, four are up for the year and four are down.

The carrier reported second-quarter earnings on Tuesday, beating estimates and producing a revenue per available seat gain of 7%, ahead of guidance. But for the current quarter, it guided toward RASM growth between negative 0.5% and positive 2.5%.

In his downgrade Wednesday, McKenzie cited, "A pilot contract that likely forces nonfuel {cost per available seat mile} higher in 2018 vs. Street expectations at the same time legacy airlines are becoming more assertive on network expansion in key JBLU growth markets (BOS and the Miami area), thus our move to the sidelines," McKenzie wrote.

Overall industry capacity in JetBlue markets in the fourth quarter will rise 7%, he said, with both American Airlines Group Inc. (AAL) - Get American Airlines Group, Inc. Report and Delta Air Lines Inc. (DAL) - Get Delta Air Lines, Inc. Report growing in Boston and New York, while competitive capacity in the Miami-Fort Lauderdale area is growing at a 10% rate, McKenzie said.

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Earlier, Barclays analyst Brandon Oglenski and Cowen & Co. analyst Helane Becker applauded the JetBlue's willingness to reduce capacity growth.

For the current quarter, JetBlue guided toward capacity growth between 6.5% and 7.5%, a half point below projections. Full-year growth will be between 5.5% and 6.5%, at the low end of the previous 5.5% to 7.5% range and the second cut since it announced 6.5% to 8.5% growth at its investor day in December 2016.

"With 3Q revenue guidance essentially in line with normal seasonality, investors might have been hoping for a bit more upside following a strong showing in 2Q," Oglenski wrote. "Nonetheless, management's willingness to quickly reduce capacity in the face of difficult summer operations should be viewed as a strong follow-through on the team's commitment to delivering superior margins."

He has an overweight rating and a $33 price target.

Becker said, "The current management team is proving they can be nimble in response to issues as they reduced capacity twice this year." She reiterated a market perform rating and increased her price target to $25 from $24.

On the call, CEO Robin Hayes said the frequency of air traffic control ground delay programs at JFK had increased to two out of every three days from one out of every three days last year, and the programs "last earlier in the day and last for longer." Runway construction at JFK and Boston Logan contributed to the delays.

For the second quarter, JetBlue said it earned 64 cents a share. Analysts had estimated 57 cents. Revenue was $1.8 billion, up 12%. Revenue per available seat mile grew 7% on 4.8% capacity growth.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.