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.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free 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
-
Smart Strategies for Paying Your Child an AllowanceBy giving your kids money to spend and save, you’ll help them sharpen their financial skills at an early age.
-
The Mulligan Rule of Retirement — Seven Mistakes You Can FixUse the Mulligan Rule to undo these seven costly retirement errors. While you can’t go back in time, some retirement choices allow for a “correction shot.”
-
From Pets to Paintings: The Little Things That Can Cause Big Estate TroubleSentimental items might have little monetary value, but their disposition can cause hurt feelings. Talking about who wants what and labeling items can help.
-
The Clock Is Ticking: Take Advantage of These Retirement Tax Benefits While They LastRecent tax changes, including an extra $6,000 deduction for those 65 and older, present a golden opportunity for retirees to reduce their tax bills.
-
I'm a Financial Adviser: This Is Why Unmarried Same-Sex Couples Need an Estate PlanWhen illness or death occurs within an unmarried same-sex partnership, family members can step in and push the surviving partner out. An estate plan is vital.
-
Stocks Bounce But End With Big Weekly Losses: Stock Market TodayThe stock market rout continued on Friday, but a late-day burst of buying power brought the main indexes off their session lows.
-
Costco Gold Bars Keep Selling Out. Are They a Smart Investment?How Costco's bullion program works, how to get the best deal and whether it makes sense for investors.
-
Use This Stock Market Recipe for a Well-Diversified PortfolioFor years, large U.S. stocks were all you needed for a diversified portfolio. A broader mix is better now.
-
A Financial Planner's Guide to a Stress-Free Adventure AbroadStart by looking at flight/accommodation costs, have a flexible schedule, seek out credit card rewards, prep for health issues and plan to cook your own food.
-
I'm a Financial Planner: This Is How Smart Women Can Plan for Financial Freedom Despite Life's CurveballsProactive planning and professional guidance can help to build your confidence and give you clarity when you're navigating major life transitions.
