Airline Stocks Plunge Amid Weak Travel Demand, Downgrades

Airline stocks have experienced a significant downturn, largely driven by decreasing travel demand and falling consumer confidence. Jefferies downgraded several major airlines, including Delta Air Lines, American Airlines, Southwest Airlines, and Air Canada, noting concerns about their future earnings and prospects for 2025. Delta's shares fell around 5% after the downgrade, with a price target slashed to $46, as the airline anticipates a reduction in its forecasts amid declining demand from budget-conscious travelers. Despite these challenges, Delta claims to be growing revenue from its premium services and credit card partnerships. Meanwhile, United Airlines remains the only carrier with a 'buy' rating from Jefferies, indicating a somewhat more optimistic outlook. The broader trend reflects a worrying shift in consumer spending habits, further exacerbated by economic uncertainties and looming tariffs.