JetBlue Airways’ (JBLU) stock got a lift on April 20 after CEO Joanna Geraghty informed employees that the airline is not considering filing for bankruptcy this year.
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Multiple media reports say that Geraghty addressed staff at the airline amid rising fuel costs and speculation about the New York-based carrier’s financial stability. In recent weeks there has been rampant speculation that JetBlue could face bankruptcy due to its strained finances.
However, the CEO is rebutting that speculation, stating in an internal memo leaked to the media that JetBlue maintains sufficient liquidity and has access to additional capital, if needed. JetBlue recently secured a $500 million loan backed by aircraft, with an option to raise another $250 million.
JetBlue’s Struggles
JetBlue has struggled financially since a federal judge ruled against a proposed merger between it and rival Spirit Airlines (SAVE), citing competition concerns. That news hurt JetBlue’s stock and forced the company to go it alone in the highly competitive discount carrier space.
JetBlue has endured several executive changes, including its chief operating officer (COO) and president, in recent years. The airline has struggled since the Covid-19 pandemic struck in 2020 and amid increased competition in the low-cost airline segment.
Is JBLU Stock a Buy?
The stock of JetBlue has a consensus Hold rating among 11 analysts. That rating is based on one Buy, seven Hold, and three Sell recommendations issued in the last three months. The average JBLU price target of $5.22 implies 9% downside from current levels.
