Allegiant Travel Jumps on Deutsche Bank Upgrade
Analysts at Deutsche Bank (NYSE: DB) upgraded shares of Allegiant Travel (NASDAQ: ALGT) on Wednesday morning from Hold to Buy and increased its price target on the stock from $60 to $90. In mid-day trading, ALGT shares have climbed nearly 3.50% to $72.82. However, the stock is off of its best levels of the session after hitting a new 52-week high of $75.93 in the early going.
In addition to the upgrade of Allegiant, Deutsche Bank also bumped its price target on shares of Hawaiian Holdings (NASDAQ: HA), owner of Hawaiian Airlines, and Southwest Airlines (NYSE: LUV). The firm raised its target on HA from $8 to $10 and LUV's price target went from $9 to $11. Hawaiian shares are slightly higher on the session while Southwest Airlines is down less than 1%.
In addressing improving trends in the sector, the analysts wrote, "We are raising our June Q earnings outlook due to better revenue results and modestly lower fuel prices. Industry net profit for the June Q is now projected to be $2.0 billion vs. our prior forecast of $1.6 billion (and compares favorably to last year's $1.0 billion result)."
Deutsche Bank also raised its full year 2012 and 2013 earnings outlook for the sector on account of lower fuel prices, but said that the revenue outlook is tempered by decelerating global GDP.
A number of other airline stocks are moving strongly higher on Wednesday. United Continental Holdings (NYSE: UAL) has jumped 4% to $24.81 and Delta (NYSE: DAL) is up around 3.50% to $11.10. Other movers include US Airways (NYSE: LCC) and Alaska Air (NYSE: ALK), which are up 2% and 1.50%, respectively.
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