Benzinga | Oct 6, 2021 10:01AM EDT

Read Why Goldman Sachs Is Bearish On Some Airline Stocks Short-Term

* Goldman Sachs analyst Catherine O'Brien downgraded JetBlue Airways, American Airlines and lowered the Price Target for Allegiant Travel and Spirit Airlines.

* O'Brien remains positive on the path to profitability recovery for the airlines over the medium-term but reduced December quarter and 2022 outlooks as she mark-to-markets for fuel and a worse short-term revenue environment than previously expected.

* The analyst downgraded JetBlue Airways Corp (NASDAQ:JBLU) to Neutral from Buy and lowered the price target to $17 (implying an upside of 10%) from $20.

* O'Brien expects JetBlue's costs to continue its codeshare partnership with American will outstrip revenue driven by the alliance over the medium-term, especially given the pricing pressure she expects to see across the industry due to elevated capacity and corporate/international demand "that will likely still be in recovery."

* The analyst downgraded American Airlines Group Inc (NASDAQ:AAL) to Sell from Neutral and lowered the price target to $18 (implying a downside of 13%) from $19.

* O'Brien expects American shares to underperform, saying its "relatively higher" operating leverage will weigh on its profitability recovery in a weaker industry pricing environment over the medium term.

* The analyst lowered Allegiant Travel Co's (NASDAQ:ALGT) price target to $265 (implying an upside of 36%) from $278 and maintained a Neutral rating on the shares.

* The analyst lowered Spirit Airlines Inc's (NYSE:SAVE) price target to $28 (implying an upside of 7%) from $35 and maintained a Neutral rating.

* Price Action: JBLU shares are trading lower by 4.62% at $15.39, AAL lower by 4.3% at $20.54, ALGT lower by 3.59% at $193.8, and SAVE lower by 4.08% at $25.9 on the last check Wednesday.