Shares of Hawaiian Holdings (HA) - Get Report , parent of Hawaiian Airlines, fell as much as 10% intraday to a four-year low on Wednesday after a double downgrade from Stifel analysts, who expect competition to create some turbulence. 

The stock fell to as low as $22.84 Wednesday morning before recouping some losses and ultimately closing at $24.10, down 5.2% for the day. 

HA fell after Stifel downgraded the company to sell from buy and dropped its price target to $20 from $30. It cited competition, in particular, the Southwest Airlines (LUV) - Get Report announcement recently that it would resume its growth into Hawaii. Southwest put its plans on hold after the Boeing (BA) - Get Report 737 MAX was grounded.

"We had expected Southwest's growth into Hawaii to be fairly balanced between the West Coast and neighbor island networks; however, its announcement last week indicates that capacity growth will skew towards the neighbor islands in 2020, which we see as an incremental negative for HA," Stifel analysts Joseph DeNardi and Bert Subin wrote in a note dated Aug. 20.

"We continue to believe that an equilibrium West Coast-HI [passenger revenue per available seat mile] exists and that, longer-term, capacity growth should normalize. However, Neighbor Island market share losses are less likely to revert and should negatively impact the Prasm this segment earns (accounts for ~20-25% of revenues) in 2020 and beyond."

Despite the double downgrade, the analysts say that U.S.-to-Hawaii Prasm trends are nearing an inflection point, which is "bullish for Hawaiian later in 2020 and a good means of understanding when sentiment towards Hawaiian could begin to shift."

But for Hawaiian's North America Prasm to stabilize, other airlines serving the state, such as Delta (DAL) - Get Report and American (AAL) - Get Report , will have to reduce capacity to accommodate the additional supply coming from Southwest, the analysts wrote. "We believe a catalyst for this would be more compelling Prasm opportunities existing elsewhere in their domestic networks ..."

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