Shares in Qantas Airways Ltd [ASX:QAN] shed 36 cents today, resulting in a 6% drop.
What happened to cause the 6% drop?
The embattled airline, which closed higher at the end of last week after some stellar earnings, is now reeling. Today’s market carnage is being blamed on JPMorgan Chase & Co. [NYSE:JPM] analysts who have dumped the airline.
The analysts have dropped the stock to an ‘underperform’ rating, down from neutral. They believe that the airline needs a boost in domestic fare prices of 10% to warrant its share price, which analysts labelled as ‘optimistic’.
It has certainly put a dampener on the company’s strong finish to last week.
Change is in the works for Qantas
The downgrade comes as Qantas announced a huge reshuffle of senior executives.
Gareth Evans will move from Qantas International to Jetstar. Alison Webster will take over Qantas International, moving to a senior executive role for the first time. Jayne Hrdlicka will transition from Jetstar to a new role, overseeing the Loyalty and Digital Ventures division.
It’s one of the biggest executive shake-ups in the company’s history, as Alan Joyce looks to mould a potential successor for his inevitable departure. Though he says that won’t be departing anytime soon.
Qantas will hope the move pays off. The company and shareholders could use some good news after today’s wipe-out.
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Junior Analyst, Money Morning