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Spirit Airlines Stock Dive 40% on Bankruptcy & Financial TurmoilSpirit Airlines (NYSE: NYSE:SAVE ), the low-cost carrier known for its budget fares, is facing a severe financial crisis, with reports suggesting the airline is exploring a Chapter 11 bankruptcy filing. Shares of the company plummeted 40% in premarket trading on Friday, October 4th, 2024, following news of its failed $3.8 billion merger with JetBlue Airways. As Spirit grapples with $3.3 billion in debt, including $1.1 billion in secured bonds due within the year, the outlook for the airline is bleak. The Weight of Debt and Losses Failed JetBlue Merger and Rising Debt The failed merger between Spirit and JetBlue would have created the fifth-largest carrier in the U.S., allowing Spirit to compete more effectively with industry giants like American Airlines (AAL), Delta (DAL), Southwest (LUV), and United Airlines (UAL). However, with the merger off the table, Spirit now faces an uphill battle with $3.3 billion in debt, of which $1.1 billion in secured bonds is set to mature in less than a year. To make matters worse, the company has been unable to turn its financial situation around, suffering from massive quarterly losses. In Q2 2024, Spirit posted a $192.9 million loss, a significant increase from the $2.3 million loss reported during the same period last year. With annual losses continuing since before the pandemic, Spirit’s attempts to boost ticket prices and restructure have fallen short of mitigating the mounting debt and operational challenges. Operating Losses and Route Cuts Spirit (NYSE: NYSE:SAVE ) has already cut routes, furloughed hundreds of pilots, and shrunk its operational capacity by nearly 20% in a desperate bid to stave off further financial strain. Despite these efforts, the company has been hit hard by increased competition from larger airlines offering competitive fares, and its low-cost model is struggling to remain profitable in the face of rising operational costs. While CEO Ted Christie mentioned ongoing discussions with bondholders about restructuring options during an August earnings call, no immediate bankruptcy filing has been confirmed. Nevertheless, Spirit is reportedly exploring Chapter 11 as a potential lifeline—a mechanism used by airlines like **Delta** and **Scandinavian Airlines** in the past to reorganize debts while continuing operations. Technical Analysis: Oversold, but Is There Hope? Technically, the outlook for NYSE:SAVE is bleak. As of the time of writing, the stock has dropped 27%, with no signs of stopping as it continues its nosedive. The RSI (Relative Strength Index) sits at an extremely oversold level of 19.88, indicating a massive selling pressure. At these levels, the stock is far below the 30 mark, signaling that it may be oversold, but the bearish momentum remains strong as investors flee the struggling airline. Gap-Down Pattern and Bearish Momentum Further adding to the technical woes is the gap-down pattern observed in the stock chart. This gap represents a sharp decline in price, typically seen when bad news—like bankruptcy rumors—hits the market. A gap-down is a strong bearish signal, suggesting that NYSE:SAVE may continue its downward trend, especially with no immediate resolution to Spirit's financial struggles. The Road Ahead: Can Chapter 11 Save Spirit? While a potential Chapter 11 bankruptcy filing looms over Spirit, history has shown that it may not be a death sentence for the airline. Airlines such as Delta and Scandinavian Airlines have used the Chapter 11 process to restructure and emerge stronger. Delta, for example, filed for bankruptcy in 2007, cutting jobs and slashing costs before reorganizing its operations and ultimately becoming one of the largest carriers in the U.S. For Spirit, a Chapter 11 filing could offer a path to restructure its $3.3 billion debt load, renegotiate bond terms, and streamline operations. However, whether it can emulate Delta’s success or continue its downward spiral depends on its ability to effectively manage its finances and navigate a highly competitive market dominated by larger, more resilient players. Conclusion: A High-Risk Play for Investors Spirit Airlines is in a precarious position, with bankruptcy discussions and heavy debt weighing on its stock. The 40% plunge in premarket trading reflects investors' lack of confidence in the company's ability to manage its financial crisis without significant restructuring. For traders, NYSE:SAVE may appear as an opportunity to accumulate shares at a heavily discounted price. However, with bearish technical indicators and the potential for further downside, this stock remains a high-risk play. The upcoming months will be crucial for Spirit’s management as they navigate their financial future—whether through a Chapter 11 filing or further restructuring efforts. Investors should exercise caution and closely monitor any updates from Spirit’s management and bondholders. While the stock may be oversold, the strong bearish signals and ongoing financial challenges suggest the turbulence is far from over.
NYSE:SAVEShort
by DEXWireNews
Spirit Airlines | SAVE | Long at $2.80I'll be the contrarian. Spirit Airlines NYSE:SAVE has been beat to a pulp, but the company is still actively flying the high skies. While low-budget airlines have hit a rough patch as low-income consumers tighten their spending, the CFO recently was awarded almost $250k in options (a bullish sign). Plus, the next few years could be great for airlines as interest rates are lowered and travel increases as AI takes our jobs - what else is there to do with people's time and money?! So, while a "risky play", it is resting along my lowest selected simple moving average which (usually) spirs a rally. This may not come until the interest rate lowering anouncement (short interest is high with this one), but the price at $2.80 is currently in my personal buy zone. Target #1 = $4.00 Target #2 = $6.26
NYSE:SAVELong
by NicksAnalysis
1
The Unraveling Drama of Spirit Airlines' Blocked Merger with JetSpirit Airlines' ( NYSE:SAVE ) stock took a nosedive, plummeting up to 60% after a federal judge blocked its $3.8 billion acquisition by JetBlue Airways. The move was hailed as a victory for the Justice Department, which had filed a lawsuit against JetBlue on antitrust grounds, arguing that the proposed acquisition would eliminate popular discounted flight options and potentially drive up industry prices. The Court's Verdict: U.S. District Judge William G. Young delivered a decisive blow to the planned merger, stating that the consolidation of Spirit ( NYSE:SAVE ) and JetBlue would have adverse effects on consumer choice and competition within the airline industry. The ruling highlighted concerns that the merger could eliminate affordable flight options, disrupting the delicate balance that allows budget-conscious travelers access to low-cost airfares. Industry Ramifications: The $3.8 billion merger, had it proceeded, would have created the nation's fifth-largest airline, providing JetBlue with enhanced financial firepower to compete against industry giants like United, American, Delta, and Southwest. With these four airlines commanding a substantial 80% of the industry's ticket revenue, the blocked merger raises questions about the dynamics of competition and consolidation within the airline sector. Legal Battles and Future Options: Despite the setback, JetBlue and Spirit ( NYSE:SAVE ) retain the option to appeal the decision before the July expiration of their merger agreement. The companies expressed their disagreement with the ruling and are currently evaluating their next steps. The high stakes involved in this legal drama underscore the broader implications for the competitive landscape of the airline industry. Tangled Merger Web: Before the attempted merger with JetBlue, Spirit had initially announced plans to merge with Frontier Airlines in a $6.6 billion cash-and-stock deal. However, this deal was abandoned in July following an unsolicited offer from JetBlue to acquire Spirit at a higher valuation. The complex web of attempted mergers and acquisitions adds a layer of intrigue to the unfolding narrative of Spirit Airlines' future. Antitrust Landscape: The Justice Department's successful intervention in the Spirit-JetBlue merger follows a similar victory in preventing a partnership between JetBlue and American in the Northeast. The government's argument, that collaboration on flights in Boston and New York would drive up fares and diminish competition, suggests a broader and more aggressive approach to antitrust regulation under the Biden Administration. Conclusion: As the dust settles on the blocked merger between Spirit Airlines and JetBlue, the implications for the airline industry are profound. The ongoing legal battles, the complexities of the proposed mergers, and the Justice Department's proactive stance on antitrust issues paint a vivid picture of an industry in flux. The outcome will undoubtedly shape the future landscape of air travel in the United States, with significant consequences for both industry players and consumers alike.
NYSE:SAVEShort
by DEXWireNews
Spirit Airlines (NYSE: $SAVE) Facing Multiple Resistance ZoneSpirit Airlines (NYSE: NYSE:SAVE ) is facing strong resistance from multiple trend lines and zones in the daily and weekly time frames. The first resistance is at $15.43, which is the downward trend line drawn from the June high. The second resistance is at $15.96, which is another downward trend line drawn from the August high. The third resistance is a zone ranging from $16.85 to $17.07, which is formed by a combination of multiple trend lines in multiple time frames. The stock has shown some signs of recovery in the last week, gaining more than 40% from its low and breaking above the 5-day, 10-day, and 20-day simple moving averages (SMAs). However, the stock is still below the 50-day, 100-day, and 200-day SMAs.
NYSE:SAVELong
by DEXWireNews
Spirit Airlines (NYSE: $SAVE) Ready For New All-Time Highs?! 💲Spirit Airlines, Inc. provides airline services. It serves 85 destinations in 16 countries in the United States, Latin America, and the Caribbean. As of December 31, 2021, the company had a fleet of 173 Airbus single-aisle aircraft. It sells tickets through its call centers and airport ticket counters, as well as online through spirit.com; and through various third parties, including online, traditional travel agents, and electronic global distribution systems. The company was formerly known as Clippert Trucking Company and changed its name to Spirit Airlines, Inc. in 1992. Spirit Airlines, Inc. was founded in 1964 and is headquartered in Miramar, Florida.
NYSE:SAVELong
by Bullishcharts
Spirit Airlines, Inc. / LONG PositionSpirit Airlines, Inc. is an American ultra-low-cost carrier headquartered in Florida. It serves the United States, Latin America, and Caribbean as an airline operator. Since mid-March, it is possible to see a declining trend in the development of the shares of the analysed company. Lately, we observed a regular bullish divergence between the price of stocks and RSI and as well as a bullish confirmation indicated by MACD. Moreover, according to the Keltner channel is the price reaching its middle boundary. Conclusion: As we can see, all these indicators and tools have shown that the price of shares is already increasing and we assume it is going to continue to grow in the upcoming period. Therefore, we recommend waiting for the price confirmation and once the shares break the downward slopping resistance line to take an advantage of the long position. For indicating the entry and target levels, the Fibonacci retracement tool was used as follows: entry range: $25.2-$26.07 target I: $29.73 target II: $31.84 stop loss: $ 24.44 NO FINANCIAL ADVICE
NYSE:SAVELong
by vf_investment
SAVE ANALYSIS and simple way to read Charts for beginnersI see SAVE going back to 25 by Jan 2021 but if you're an option trader i suggest getting ITM calls for 2021 even 2022 if you want to add to long term portfolio. Shares is also good to add to your stock portfolio. Remember to keep in mind if airlines were to shutdown and vaccine trials see no further progress that would be a sign to get out, but recent news looks good for airlines in general and this is an easy money printer here! hopefully momentum can carry us back to the ATH within the next 2-5 years at 85$. Imagine getting a 16$ call exp 1/2022 now and SAVE is back up at $50 ....
NYSE:SAVE
by jUiCE_Trades
2
SAVE: Strong Fundamentals, Bullish Technicals 1W (Jun. 19)X Force Global Analysis: In this analysis, we take a look at Spirit Airlines, a company leading the ultra low-cost carrier business in the US. We explore the company's fundamentals, as well as its technicals to assess its bullish probabilities. Fundamental Analysis - Spirit Airlines (SAVE) has shown an extremely steady growth over the past years. - Their revenue and net profit showed a steady increase throughout time - However, as with most other airline companies, Spirit Airlines was also heavily hit by the Corona Virus (COVID-19) - As a result, they have underperformed in terms of quarterly eps, in Q1 2020 - Nonetheless, as the stock market continues to bounce strongly, and the effects of the virus begin to mitigate, we see signs of a continued bullish rally - With businesses slowly returning back to normal, given that Spirit Airlines' financials remain intact with the current upwards trend, we could anticipate higher returns this year, compared to last year. Technical Analysis - Technically, the stock is extremely oversold - It has broken through the historical support at $33.13, testing new lows - However, as it dropped so severely, it has dropped in a choppy manner, creating multiple gaps on multiple time frames - The easiest to spot and refer to are the gaps on the weekly: there are gaps at $10.74, $40.42, and $51.95 - Prices have been trading under the Ichimoku cloud, indicating a bearish trend, for over a year now - We have two significant resistance lines: the short and long term descending trend line resistances marked in a dotted red line - The Relative Strength Index (RSI) is forming lower highs, as prices are suppressed by an external factor - the Corona Virus (Covid-19) - However, the Moving Average Convergence DIvergence (MACD) has formed a golden cross, with immense bullish histograms, demonstrating momentum and strength in the bounce What We Believe Spirit Airlines is a rather unpopular stock, with surprisingly strong fundamentals and financials. Technicals demonstrate 3 main areas of resistance: at $33 levels where the short term descending trend line and historical resistance converge. as well as the upper span of the Ichimoku cloud. The second major resistance lies around $40-42, where the previous local high at the 0.618 FIbonacci retracement remains with the price gap. Lastly, there is strong resistance around $51-55 where the 0.786 Fibonacci retracement, and price gap lie, with the long term descending trend line resistance converging. Eyeing these three major areas of resistance will help investors enter positions based on confirmations provided by the trend reacting to these levels. Should we break the final resistance, it's highly probable that SAVE moves to retest all time high levels, and possibly even create new highs. Trade Safe.
NYSE:SAVELong
by XForceGlobal
Profit taking occurring on SAVE for the next few daysIn early May, Spirit airlines was tanking. I had recognized that there was a double bottom in play at the 7.50 range so I loaded up on some SAVE shares to look for a profit taking move. For the past week, this stock has been on fire, having multiple days of 30%+ gains. I feel that we are going to see some downward potential here in the short term. RSI is currently in the oversold level on the 4H, and after such an aggressive impulse, I would anticipate that there will be some profit taking going on over the next few days. I anticipate that SAVE will hit the yellow ascending support line, at around $19.00. If this support tumbles, I think it may be a bear trap would expect the stock to fall to around $16.50 before reversing its course for the next leg up on its up trend. I will be looking to add to my position at both the $19.00 and $16.50 levels. My bias will change if the stock closes below $11.50. I think in the long run, SAVE will revisit the price it was trading at the beginning of the year.
NYSE:SAVEShort
by xcbickel
4