BB&T Downgrades Pinnacle Airlines
BB&T Capital downgrades Pinnacle Airlines (PNCL ) to hold from buy.
Analyst Anthony Cristello says while he believes the company's low-cost model and improving balance sheet will afford it more future growth, near-term growth opportunities are somewhat limited right now without participation in jet awards from Northwest Airlines.
He notes under Northwest's new pilot agreement, it will award 40 new 50-seat jets to regional operators. Unfortunately, existing Airlink partners Pinnacle and Mesaba are prohibited from receiving any new growth. For now, he expects limited upside in Pinnacle until a clearer path for long-term growth is established.