Will The Rally Continue In Alaska Air?

Will The Rally Continue In Alaska Air?

BRAZIL - 2020/04/20: In this photo illustration an Alaska Airlines logo seen displayed on a ... [+] smartphone. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)



SOPA Images/LightRocket via Getty Images

Alaska Airlines stock (NYSE: ALK) has observed a 25% jump since the beginning of the month on hopes of a successful vaccine by early next year. As the company observed only $637 million of operating cash outflow for the first nine months, the $3 billion drop in the stock's market capitalization looks unwarranted given the positive results released by Pfizer



PFE

and expectations of an early macroeconomic rebound. Thus, we believe that the stock has more room for growth and we compare Alaska Airlines' stock performance during the current crisis with that during the 2008 recession.

2020 Coronavirus Crisis

Timeline of 2020 Crisis So Far:



12/12/2019: Coronavirus cases first reported in China

1/31/2020: WHO declares a global health emergency.

2/19/2020: Signs of effective containment in China and hopes of monetary easing by major central banks helps S&P 500 reach a record high

3/23/2020: S&P 500 drops 34% from the peak level seen