Shares of airlines stocks are hitting even more turbulence as investors and analysts try to determine how the ongoing coronavirus outbreak will affect passenger traffic, revenue and earnings.
United (UAL) - Get United Airlines Holdings, Inc. Report, Delta Air Lines (DAL) - Get Report and American Airlines (AAL) - Get Report were all lower on Friday after British Airways and Iberian Airways parent IAG and European budget carrier EasyJet both said earnings would be “adversely affected” by the coronavirus outbreak.
In morning trading, United stock was down 1.25% at $64.13, Delta was down 2.57% at $46.95 and American was down 3.06% at $19.97.
United took an additional hit after announcing that it will be cutting back a significant portion of its U.S.-to-Asia routes amid a large drop-off in passenger traffic. United has the most routes to Asia.
Meantime, IAG said it expects capacity to be hit by 1% to 2% amid canceled flights and slower bookings. The company has suspended all flights to mainland China and cut others across Asia. In Italy, IAG said capacity had been significantly reduced for the coming month.
While United, Delta and American - the airlines with the most flights to China and other international destinations - have already seen their shares walloped amid hundreds of canceled flights and a big drop in passenger traffic, the European warnings prompted another wave of selling as investors try to price in additional revenue declines.
Domestic carriers were also under pressure on Friday as investors brace for a general drop-off in passenger travel in the continental United States amid rising panic over the potential spread of COVID-19 there.
Shares of Alaska Airlines (ALK) - Get Report were down 2.3% at $51.75, shares of Southwest Airlines (LUV) - Get Report were down 1.29% at $46.03, shares of JetBlue (JBLU) - Get Report were down 2.7% at $15.83 and shares of Spirit (SAVE) - Get Report were down 2.96% at $28.87.