Alaska Air Group's (ALK) proposed acquisition of Hawaiian Airlines parent Hawaiian Holdings (HA) has cleared the U.S. Department of Justice after the period for its regulatory investigation expired yesterday. Hawaiian Holdings' stock has responded to the news by jumping more than 11% in Tuesday's session, while ALK shares are down slightly at last check.
"This is a significant milestone in the process to join our airlines," Alaska Air Group said in a statement. The air carrier added that during the Department of Justice's review, it worked closely with Hawaii's attorney general "to reinforce and expand upon our commitments for the future of Hawaiian Airlines" as well as local consumers. "These include plans to maintain the Hawaiian Airlines brand and local jobs and continue providing strong service between, to, and from the Islands," it said.
The $1.9 billion merger, first announced last December, still does not have the all-clear, though. While this is a major regulatory win, the transaction still remains subject to other closing conditions, including approval by the U.S. Department of Transportation (DOT), Alaska Air Group said.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
According to CNBC, the Department of Transportation released a statement Tuesday saying it "is reviewing the application and can only approve a transfer if it is in the public interest."
Hawaii Governor Josh Green said Tuesday that he is "confident that by the joining of these two airlines, a stronger company will emerge and offer more travel options for Hawaii residents and local businesses – and will enhance competition across the U.S. airline industry."
Is Alaska Air stock a buy, sell or hold?
Alaska Air Group has struggled on the price charts in 2024, down nearly 11% for the year to date. Still, analysts are hopeful the industrial stock can stage a turnaround. According to S&P Global Market Intelligence, the consensus analyst target price for ALK stock is $52.07, representing an upside of nearly 50% to current levels. Additionally, the consensus recommendation is Buy.
However, not all analysts are bullish on the stock. Financial services firm CFRA Research has a Hold rating on ALK stock with a $39 price target.
CFRA Research analyst Siye Desta says the air carrier faces several growth risks, including weaker domestic demand, higher labor costs and the grounding of its Boeing 797-9 Max fleet.
Still, Desta's $39 price target on ALK stock sits nearly 12% above where it's currently trading.
Related Content
-
The ‘First Year of Retirement’ RuleThe 'first year of retirement' rule says the 12 months after you leave work set the tone for your entire later life — so it's vital to approach them mindfully.
-
Tech Stocks Drag This Growth Fund DownA rough stretch for mega-cap tech and tech-adjacent names has put pressure on this Mairs & Powers mutual fund.
-
Tech Stocks Drag This Growth Fund Down
A rough stretch for mega-cap tech and tech-adjacent names has put pressure on this Mairs & Powers mutual fund.
-
Timing Is Everything for Roth Conversions: An Expert's Guide to the Right StrategyUnderstanding the nuances of Roth conversions can help you avoid forking over more money in taxes than you need to.
-
Are You Ready for the Emotional Side of Retirement?Financial adviser warns that life after work is coming, so start preparing … mentally, as well as financially. If you're nervous, take heart. Some simple strategies could ease the way.
-
Stock Market Today: Dow Dives 769 Points on Iran-Israel ConflictLosses accelerated in afternoon trading amid reports Iran retaliated against Israel.
-
Four Ways to Help Prevent a Market Downturn From Scrambling Your Nest EggYou may not be able to avoid a market decline when you're newly retired and starting to rely on your nest egg for income, but you can plan for that risk.
-
Is Your Home Disaster-Ready? An Insurance Expert's Guide to Preparing for Storms and FiresHomeowners can take these steps to protect their properties from hurricanes, tornadoes, wildfires and hail, while also potentially reducing their insurance costs.
-
Stock Market Today: Stocks Rise as Treasury Yields DropA round of not-too-terrible economic data helped boost the bond market Thursday.
-
A Financial Adviser's Defense of Annuities: They're Just MisunderstoodAnnuities can offer retirement income stability and security against market volatility, though some do have drawbacks. The key is to understand their features before buying.
