American Airlines parent company, AMR Corporation (NYSE: AMR) shares fell to a yearly low yesterday as it was halted 5 times amidst heavy volume triggering the circuit breaker! Analysts have debated the prospects of a bankruptcy filing for the third largest U.S. airline that lags behind its industry peers. AMR closed down over 33% at $1.98…
“When can they stop the bleeding of cash?” asked Basili Alukos, an equity analyst at Morningstar. The carrier had a second-quarter net loss of $286 million, while rivals showed profits. “If it appears we’re coming into somewhat of a rough patch or slowdown, how is that going to fare for them?” Alukos said. “I don’t think very well, because they were unable to generate a profit kind of in the best of times for the airlines last year.” (Read more)
AMR has led declines this year among the largest U.S. airlines. It is headed toward a fourth consecutive annual loss, spurring bankruptcy speculation, as a slowing economy fuels investors’ belief that air travel will slump, said Ray Neidl, a Maxim Group LLC analyst in New York. (Readmore)
More than 200 pilots have retired from the Fort Worth, Texas, carrier in the last two months, compared with a typical monthly dozen, according to media reports. Pilots who retired last week were able to cash in company stock at its Aug. 1 price, which was 28% above Friday’s closing price.
“We are in a down market today, but the exceptional number of American pilots retiring is a sign that they want to protect their pensions and get out before a possible filing further [depresses] the stock price,” said Ray Neidl, an analyst with Maxim Group LLC. “I still believe that AMR management wants to avoid filing.” (Read more)
AMR has fallen through its lower Bollinger band trading lower than it did in March 2009! The RSI is dramatically oversold at 15 and the ADX is showing a very negative trade trend. The MACD had a negative cross and could take a while to revert.
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