Shares of Latam Airlines, an air carrier based in Chile, soared as much as 35% on the news. Partnering with Delta will boost Latam, industry watchers say. Delta shares"It's hard to envision how Delta's influence over LATAM would not afford significant benefits, in our view," wrote Jamie Baker, US airlines analyst at JPMorgan.
The deal with Latam, the biggest airline in South America, is Delta's largest since it merged with Northwest Airlines over a decade ago. It will also expand Delta's reach to the region, since Latam flies to dozens of destinations in Latin America. Together, the two partners will hold the leading position in five of six top markets in Latin America, according JPMorgan, which upgraded shares to "neutral" from "underweight" and raised its price target to $14 from $10.
Bank of America Merrill Lynch Pedro Mariani echoed the positive sentiment, saying the transaction is a net positive for Latam. While unexpected, the move "shows the strength of the company's platform in the Latin American market," he said. Of the 17 analysts that cover the company, four say to buy, 12 say hold, and only one says to sell shares now, according to Bloomberg data. The average price target is $11.72.
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Source: CNBC - 🏆 12. / 72 Read more »