Spirit Airlines Jumps 50% in 24 Hours: Why is SAVE up Today?
Spirit Airlines (SAVE) stock is flying following the opening of the US markets on Monday morning, surging over 50% in value. Following concerns over mounting debt and possible bankruptcy, as well as a failed sale, Spirit showed strong signs of recovery today, securing more time to work out its debt burden, hence easing near-term bankruptcy fears. The stock took off on the news, trading up as much as 73% on Monday morning and up 58% as of 1 p.m. ET.
Spirit Airlines secured more time to work out its debt burden, easing near-term bankruptcy fears. The airline’s stock took off on the news, trading up as much as 73% on Monday morning and up 58% as of 1 p.m. ET. The airline had an Oct. 21 deadline to refinance or extend bonds or faced issues with its credit card processing agreement. However, Spirit was able to secure a new deadline of December 23.
The deadline extension “could provide the carrier a little breathing room” and “result in a short-term bounce for Spirit’s shares,” Citi analyst Stephen Trent said in a research note.
Additionally, The discount airline also said it has used all of a $300 million revolving credit line and expects to have about $1 billion of liquidity by the end of 2024. Coupled with lower fuel prices and a cash infusion from its revolving credit line, Spirit hopes to not only avoid bankruptcy but boost its stock value for worried investors.
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Spirit Airlines Remains In Bottom Half Of Gainers On Stock Market in 2024
Despite Monday’s stock boom for, SAVE shares are still more than 95% below their highs for the year. The good news is that means the stock likely has considerably more upside should it work out a deal. However, the market still clearly sees how in the dumps stock in the airline is at present. Furthermore, investors aren’t forgetting the company’s failed merger with JetBlue which saw the stock fall more. In January, a federal judge blocked a merger between Spirit and JetBlue on the grounds the deal would harm price-sensitive customers.
Spirit Airlines (SAVE) stock is currently up to 2.2457 per share as of 3:00 PM on Monday. The growth also reveals a 36% climb in the last seven days, according to Yahoo Finance.