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Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuMacro tailwinds are lining up that will give JetBlue Airways a boost, according to Deutsche Bank. The investment bank upgraded the airline to buy from hold. It also raised its price target on shares to $5.5 from $3, suggesting 54% upside to Wednesday’s close. Shares have fallen about 22% year to date as the Iran war has pushed up the cost of fuel, putting pressure on margins. However, the stock is up more than 16% over the past week, with momentum picking up after JetBlue on Oct. 26 raised its full-year guidance for revenue per available seat mile — a key metric for the company. “The near-term backdrop for airline shares has improved markedly over the past month,” analyst Michael Linenberg said Thursday in a note. “The key pillars of our upgrade are as follows: 1) a favorable supply backdrop that stretches into next year; 2) an industry prioritizing yield in response to inflationary pressures (e.g., higher fuel prices), which we think disproportionately benefits the carriers that cater to a value-conscious, discretionary traveler; and 3) Frontier and JetBlue are on the cusp of several major product launches that should be meaningfully revenue- and margin-accretive in 2027 and beyond.” JBLU YTD mountain Shares are down roughly 22% year to date. Linenberg also noted that if Democrats regaining control of Congress leads to a “cooling down” of Middle East tensions, it could mitigate fuel price volatility. Seasonality is also on the stock’s side, he said. Deutsche Bank pointed out that airlines have produced positive returns for the December quarter in 21 of the last 25 years. The bank’s call goes against consensus on Wall Street. Of the 18 analysts that cover JetBlue, 13 have a hold rating on the stock, LSEG data shows. Linenberg also upgraded budget airline Frontier to buy.Read More