Why Shares of United Airlines Lost 15% in January
Shares of United Airlines Holdings (NASDAQ: UAL) fell 15.1% in January, according to data provided by S&P Global Market Intelligence, as investors reacted to the growing coronavirus scare. Airline stocks were all under pressure over concerns that the outbreak would eat into travel demand, and United was hit particularly hard.
Frightening stories out of China dominated headlines throughout much of January and hit travel stocks hard based on concerns that the outbreak would lead to empty flights and vacationers deferring travel plans. United and other U.S. airlines suspended flights to China late in the month, but the outbreak at the very least is certain to hurt first-quarter results and could weigh on the sector for some time to come.
United lost more than most from the coronavirus because of its oversize exposure to China and the Asia Pacific region. It has about 4% of its total capacity tied to China and 15% tied to the region. In comparison, Delta Air Lines has about 3% of capacity tied to China and 9% to the Asia Pacific, and American Airlines Group 2% and 6%, respectively.
Source Fool.com
