There’s a lot of bad Southwest Airlines news today that isn’t doing LUV stock any favors.
The first bit of bad news concerning Southwest Airlines (NYSE:LUV) has to do with grounded planes. The company notes that it is seeing an increasing number of grounded planes due to maintenance issues.
A Southwest Airlines news release claims that these issues started becoming more prevalent following failed negotiations with the Aircraft Mechanics Fraternal Association. The company believes the ongoing negotiations may have something to do with the dramatic increase in the number of grounded planes.
“AMFA has a history of work disruptions, and Southwest has two pending lawsuits against the union,” Southwest Airlines COO Mike Van de Ven said in a statement. “We will be investigating this current disruption and exploring all possible remedies.”
More bad Southwest Airlines news comes from an update to its estimates on how the government shutdown affected its business. The airline company says that it now expects the shutdown to have lowered its revenue in the first quarter of 2019 by $60 million. It was previously only expecting a revenue impact between $10 million and $15 million from the shutdown.
The final negative Southwest Airlines news today is a downgrade from Goldman Sachs analyst Catherine O’Brien. She downgraded the stock from a “Neutral” rating to a “Sell” rating. At the same time, she also lowered her price target for LUV stock from $66 to $54.
LUV stock was down 5% as of Wednesday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.