JetBlue plans to bring its everyday low fares services to New York and Boston. The Northeast Alliance, approved by the Transportation Department, offers JetBlue an opportunity to access airports that it has been locked out of for years.
Head of revenue and planning at JetBlue (JBLU), Scott Laurence, expects the expansion to allow the airline to connect with a much larger customer base and international network. As part of its Northeast Alliance with American Airlines (AAL), JetBlue will triple its flights to LaGuardia and introduce 40 additional codeshare routes.
JetBlue has already confirmed plans to add seven new destinations to its route map this year and next. Some of the destinations the airline will target include the Midwest, Southern US, and Central America.
Laurence said, “We can’t wait to shake up the status quo in these markets currently dominated by high-fare carriers, and we look forward to introducing new customers to JetBlue favorites like live seatback TV, free Wi-Fi, the most legroom in coach and great service from our friendly Crewmembers.”
The company’s venture capital subsidiary, JetBlue Technology Ventures, has completed an investment in Universal Hydrogen, a company fueling carbon-free flights. The investment will allow Universal Hydrogen to accelerate the development of its hydrogen logistics network and bolster its commercial activities.
The investment is aligned with JetBlue’s environmental objectives. It should also allow the airline to play a role in the fast-growing hydrogen for aviation sector. (See JetBlue stock analysis on TipRanks)
Raymond James analyst Savanthi Syth has already noted the potential impact of JetBlue’s strategic partnership with American Airlines. Likewise, the analyst has upgraded the stock to Outperform with a $24 price target, implying 20.9% upside potential to current levels.
“Investor sentiment and earnings momentum are likely to be favorable for JetBlue due to the pent-up demand for leisure/VFR travel as pandemic-related restrictions are lifted. Moreover, the potential for normalized margin expansion exists if JetBlue were to execute on just a few of the identified earnings levers, including (1) the Northeast alliance with American […],” Syth wrote in a research note to investors.
Wall Street is cautiously optimistic about JetBlue’s prospects going by the Moderate Buy consensus rating based on 7 Buys and 3 Holds. The average analyst price target of $23.60 implies an 18.89% upside potential to current levels.
JBLU scores an 8 out of 10 on TipRanks’ Smart Score rating system, implying it could outperform market expectations.
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