UPDATE: Bank of America Downgrades US Airways Group to Underperform, Lowers PT Following Merger Proposal

In a report published Wednesday, Bank of America analyst Glenn D. Engel downgraded the rating on

from Neutral to Underperform, and lowered the price target from $17.00 to $16.00. In the report, Bank of America noted, “Should the proposed merger between AMR and LCC close, LCC shareholders would receive 28% of the combined company. A combination of AMR and LCC creates the world's largest airline and an effective competitor to both UAL and DAL. However, value of the combined company dependent on contributions from AMR and LCC as well as expected synergies. We believe that standalone AMR estimates are too high.” US Airways Group closed on Tuesday at $17.65.