Wed, Feb 06, 2008
But Some Say The Boom Will Be Short-Lived
While many stocks are down over the past few weeks, JetBlue's
stock price has seen a resurgence. But analysts and competitors
remain skeptics, and say the rise in the company's valuation will
be temporary.
JetBlue stock was up 44 percent last week, after a positive
earnings report on January 29. For the year, the stock is up about
16 percent, compared with a 12 percent increase in overall airline
stock prices.
Following its all-time high near $31, the stock was pounded in
2007 after horrendous weather-related flight delays and
cancellations in February and March made the company the butt of
late-night comedy shows. JetBlue closed Friday at $6.89.
JetBlue also says it's pursuing commercial opportunities with
Lufthansa, growing revenue from its LiveTV service, which provides
in-flight TV and Internet connectivity to eight airlines, and
luring business travelers with refundable fares and a cabin
upgrade.
The Street.com reports Continental CEO Larry Kellner scoffs at
the recent buy-in by Lufthansa. Speaking on an investor conference
call last month, Kellner said, quote, "We probably have dozens of
models... I can assure you that the thought of [somebody] taking a
19% stake in JetBlue wasn't one of them."
Analysts have suggested Lufthansa made to move to take advantage
of the cheap dollar, rather than for strategic reasons.
So far, Wall Street is yawning, noting that JetBlue stock is
currently trading at about 57 times expected 2008 earnings.
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