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JetBlue Is Undervalued, While Southwest Is Overvalued, Analyst Says

A veteran Wall Street analyst upgraded JetBlue and downgraded Southwest.

A veteran Wall Street analyst upgraded JetBlue (JBLU) - Get Free Report  and downgraded Southwest (LUV) - Get Free Report  on Wednesday. "All domestic airlines are not created equal; neither are they equally valued." wrote JPMorgan analyst Jamie Baker in a report released Wednesday.

Wall Street has long favored domestic carriers. JetBlue shares closed Tuesday at $21.42, down 4.5% year to date. Southwest shares closed Tuesday at $49.65 and are flat for the year.

Baker, citing his forward earnings estimates, said JetBlue's price-to-earnings ratio is "one of just two U.S. airlines in our coverage trading below 10X 2017 forecasts."

This article was written by a staff member of TheStreet.