Airline analyst Bob McAdoo of Imperial Capital put out a report Tuesday advising investors to turn their attentions toward American Airlines Group and Delta Air Lines and away from United Continental Holdings.
The reason: He thinks United Airlines’ planned expansion of Dallas Love Field indicates that United management isn’t thinking straight.
“In our view, recent announcements regarding Dallas Love Field scheduling continue to demonstrate UAL’s inability to shift its marketing mindset away from market share and towards improving profitability,” McAdoo wrote. “We believe investors will continue to favor management teams focused on profitability even if it means decreased market share.”
The reason for his unhappiness is United’s plans to expand its Love Field schedule from seven departures today from Love Field to Houston’s George Bush Intercontinental Airport to 12 flights by early January.
He said the expansion “is likely to be highly unprofitable” and “seems more focused on hoarding airport assets, or getting in the way of Delta, than on profits.”
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