Do you think that Airline stocks can turn into penny stocks?

Real World Aviation
#1

During the COVID 19 crisis that took a big hit to the stock market especially the airline market. Not to mention the drama with Warren Buffett sold his entire position in these major US airlines:

American Airlines
Delta Air Lines.
Southwest Airlines.
United Airlines.

Some airlines like American Airlines have been penny stocks for example 2012

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In the 2nd picture you could see that the price per share for American Airlines was about 50 cents and then the Airline industry Came back in shape.

In the 1st picture you could see that the candle chart shows more red candles than green in the past 1 month so I am thinking that because of warren buffet, lots of people are doing the same thing in order to save their money.

I think that the airline market can’t recover for 5 years or more. This also goes with Boeing lots of airline are removing their orders to save money. About 3/4 of the airlines are not reporting profits in the Q2. If airlines turn into penny stocks I recommend to invest for the long term.

8 Likes
#2

Forgot to mention this is my personal opinion.

#3

Certainly possible with new companies…

1 Like
#4

I will definitely have to look into this as a good investment. The only problem with investing in airlines is the fact it is a huge gamble due to a over saturated and rapidly changing market.

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#5

True, some new airlines are thinking of Declaring bankruptcies cause lack of profits for the Q1 and Q2. I don’t think Q3 will be any better.

#6

It really depends. But some of the things that could send stocks up.

  • Government bailouts
  • Government incentives e.g tax waivers & subsidies
  • Airline route expansions(As parts of the world reopen slowly by slowly, we see airlines restore their networks slowly)
  • COVID-19 vaccine breakthrough(this would be easier said than done especially since the original virus is mutating, making it more and more difficult for researchers to come up with à foolproof vaccine)

Though, be wary of some of the smaller airlines as they are more vulnerable in this period than the legacies.

But, really, this is just my two cents, you may have a different opinion ;)

2 Likes
#7

invest now and it may become a dollar in a year :)

But actually, seems like a good long-term investment to sell after the industry recovers

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#8

I personally think that government does not want to keep wasting tons of money if so… I’m going to be interested if the government bails them out

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#9

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