Spirit Airlines, Inc. SAVE shares are trading lower Tuesday, and the stock has fallen more than 30% over the last five days. Here’s a look at what’s going on:
Sympathy with JetBlue Airways Corporation
Spirit Airlines shares may be moving on sympathy with JetBlue Airways Corporation JBLU, which is falling after reporting its third-quarter financial results on Tuesday.
JetBlue reported an adjusted loss per share of 39 cents, below the consensus estimate of a loss of 25 cents per share. The company reported operating revenue of $2.4 billion compared to the estimate of $2.381 billion for the quarter.
Concerns Over Proposed Merger
Spirit Airlines’ stock may also be losing ground as investors grow concerned over the Department of Justice’s civil antitrust lawsuit to block the airline’s proposed merger with JetBlue Airways.
Spirit Airlines shares are dropping on heavy trading volume Tuesday. According to data from Benzinga Pro, nearly 5 million shares have already been traded in the session, compared to the stock’s 100-day average of 1.883 million shares.
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SAVE Price Action
According to Benzinga Pro, Spirit Airlines shares are down 16.5% at $10.89 at the time of publication.
Image: F. Muhammad from Pixabay
Spirit Airlines, Inc. (NYSE: SAVE) shares are experiencing a significant downturn, plunging more than 30% over the past five days. This downward spiral can be attributed to the parallel decline of fellow airline JetBlue Airways Corporation (NASDAQ: JBLU), whose disappointing third-quarter financial results have sparked concerns among investors.
Turbulence for JetBlue Airways
JetBlue Airways Corporation reported an adjusted loss per share of 39 cents, falling short of the market consensus estimate of a 25 cent loss per share. Additionally, the company’s operating revenue for the quarter stood at $2.4 billion, slightly exceeding the estimate of $2.381 billion. The underwhelming financial performance has fueled apprehension among stakeholders and put pressure on its stock price.
Legal Obstacles for Spirit Airlines and JetBlue Merger
Another factor contributing to Spirit Airlines’ declining stock value is the Department of Justice’s civil antitrust lawsuit aimed at blocking the proposed merger between Spirit Airlines and JetBlue Airways. The imminent legal battle has created uncertainty in the market, leading to increased stock sell-offs as investors assess the potential magnitude of the lawsuit’s impact on both companies’ future prospects.
Heavy Trading Volume Sends Shivers Through the Market
On Tuesday, Spirit Airlines experienced a substantial drop in its stock price due to heightened trading volume. The session witnessed nearly 5 million shares being traded, significantly surpassing the stock’s 100-day average of 1.883 million shares. The surge in trading activity indicates elevated investor interest and concern about the ongoing events surrounding the airline.
The Ripple Effect
The repercussions of Spirit Airlines’ stock decline are not confined to the aviation industry. The faltering performance of popular stocks, like Spirit Airlines and most recently GameStop, can have an alarming impact on market stability and investor sentiment. Investors are urged to closely monitor these developments and assess potential investment strategies accordingly.
Price Action Overview
As of the time of publication, Spirit Airlines shares are experiencing a significant downturn, trading at $10.89, reflecting a 16.5% decline. Investors and market observers should closely follow these price trends to make informed decisions.
Image: F. Muhammad from Pixabay