American Airlines stock sinks as COVID-19 cases surge, while Cowen reiterates long-time bullish stance

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Shares of American Airlines Group Inc. sank 6.1% in afternoon trading Wednesday, and have now shed 35% since closing at a 3 1/2-month high on June 8, as worries about a surge in COVID-19 cases overshadowed upbeat analyst comments on the air carrier's recent liquidity boost. With more than half the U.S. states showing increases in COVID-19 infections, New York, New Jersey and Connecticut, which have declining rates of infections, said they will impose a 14-day quarantine on travelers from new hotspot states, including Florida, Texas, Arizona and North Carolina. Meanwhile, Cowen analyst Helane Becker reiterated her outperform rating on American's stock for the past three years, and her $20 stock price target, as she praised the additional liquidity the air carrier raised. Early Tuesday, the company said its public offering of 74.1 million shares priced at $13.50, to raise $1.00 billion, and that it priced a public offering of $1 billion in 6.50% convertible senior notes due 2025. "American remains a contrarian stock idea but in our view, the improved liquidity situation is a net positive," Becker wrote in a note to clients. American's stock outperformed its peers, as shares of United Airlines Holdings Inc. dropped 7.7%, Delta Air Lines Inc. slid 7.7%, JetBlue Airways Corp. lost 8.6% and Southwest Airlines Co. gave up 6.4%. Meanwhile, the Dow Jones Industrial Average was down 768 points, or 2.9%.