Shares of JetBlue (JBLU) - Get JetBlue Airways Corporation Report and Spirit Airlines (SAVE) - Get Spirit Airlines, Inc. Report advanced early Wednesday after J.P. Morgan Chase (JPM) - Get JPMorgan Chase & Co. Report upgraded the two U.S. carriers to overweight, expecting the coronavirus to have no permanent negative margin impact on airlines.
At last check shares of JetBlue rose 2.6% to $21.30, while shares of Spirit Airlines rose 2.4% to $37.94.
J.P. Morgan analyst Jamie Baker double upgraded JetBlue to overweight from underweight with a price target of $25, up from $15.
The coronavirus "crisis may provide a profit stimulus to the industry in the event that corporate demand rebounds to within 80% of estimated 2019 levels,” Baker wrote in a note.
The investment firm expects JetBlue to continue to focus on cost controls in the wake of the pandemic, and it called the current valuation attractive, Bloomberg News reported.
And the firm affirmed its overweight ratings on Delta Air Lines (DAL) - Get Delta Air Lines, Inc. Report and Alaska Air (ALK) - Get Alaska Air Group, Inc. Report and underweight ratings on United Airlines (UAL) - Get United Airlines Holdings, Inc. Report and American Airlines. (AAL) - Get American Airlines Group, Inc. Report
Last week, Morgan Stanley upgraded United Airlines (UAL) - Get United Airlines Holdings, Inc. Report and Alaska Air (ALK) - Get Alaska Air Group, Inc. Report, saying that analysts’ consensus estimates for airline earnings were too low.
On Tuesday, the Chicago aerospace giant Boeing (BA) - Get Boeing Company Report said it secured net new orders for the second consecutive month in March as carriers prepared for a post-pandemic rebound in global passenger traffic.