Why Airline Shares Are Falling Today
Airline shares were under pressure on Monday after United Airlines Holdings (NASDAQ: UAL) moved to shore up its balance sheet via added debt and issuing more shares. Investors are also getting nervous about a resurgence in COVID-19 cases, putting pressure on travel stocks.
United shares traded down 6% as of 11 a.m. EDT, after opening down more than 10%. Shares of American Airlines Group (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) opened down 9.9% and 8%, respectively, and were each off more than 3% in late-morning trading, while Southwest Airlines (NYSE: LUV) stock had made up most of its initial 6.3% decline.
The airlines have been scrambling to raise cash as the pandemic slashed demand for travel. United is the latest to move, announcing Monday it plans to raise $5 billion by borrowing against its frequent flier program while also filing to issue and sell up to 28 million shares of its common stock.
Source Fool.com
