JetBlue Chief Joanna Geraghty urged bond investors to reconsider the airline's valuation, citing a "significant disconnect" between financial results and market narrative. One secured bond dropped from 80 to 40 cents on the dollar amid sustained oil prices and a 61% fuel cost increase year-over-year. Despite a recent loss, Geraghty highlighted positive trends including 18% revenue per available seat mile growth, higher fares, and a new Florida hub.
She projected potential 2028 earnings of $1 per share, surpassing analyst estimates of 32 cents. The airline holds $7 billion in unencumbered assets, including owned aircraft, as a potential collateral source. While Geraghty remains optimistic about underlying trends and potential fuel price declines, creditors remain focused on principal repayment.
The situation echoes Spirit Airlines' recent bankruptcy, though JetBlue points to premium cabin strategies employed by legacy carriers as a positive model.
Source: Financial Times Companies · Summarized by HeadlinesBriefing