March 20, 2008 / 12:46 PM / 10 years ago

UPDATE 1-Lehman downgrades U.S. airlines sector to neutral

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 March 20 (Reuters) - Lehman Brothers downgraded the U.S. airlines sector to “neutral” from “positive,” saying the market’s acknowledgement of substantial earnings risk over the next several months was likely to lead to choppy trading.
 The brokerage said the energy markets had not projected any relief and that the bigger risk to estimates was fuel prices, not recession.
 Lehman downgraded AirTran Holdings Inc AAI.N and US Airways Group Inc LCC.N to “equal weight” from “overweight.”
 The brokerage also cut its price targets on several airlines, including Continental Airlines Inc (CAL.N), Delta Airlines Inc (DAL.N) and Northwest Airlines Corp NWA.N
 The following table lists Lehman’s price target changes on nine U.S. airlines. AIRLINES                   RIC         PRICE TARGET (in $)
                                     New     Old AirTran Holdings Inc      AAI.N       7.50   12.00 Alaska Air Group Inc      (ALK.N)      17.50   27.00 Continental Airlines Inc  (CAL.N)      19.00   25.00 Delta Air Lines Inc       (DAL.N)      14.00   22.00 JetBlue Airways Corp      (JBLU.O)      7.00   10.00 Northwest Airlines Corp   NWA.N      11.00   18.00 Southwest Airlines Co     (LUV.N)      13.50   15.50 UAL Corp  
            UAUA.O     23.00   38.00 US Airways Group Inc 
 LCC.N      11.00   29.00  (Reporting by Biswarup Gooptu in Bangalore; Editing by Himani Sarkar)   

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