AMR Shares Plunge on Bankruptcy Talk
The stock of American Airlines parent company AMR tumbled Monday, at one point falling nearly 40 percent, on renewed concerns that the carrier could be headed for bankruptcy protection.
The company quickly denied to CNBC that it is considering a pre-packaged bankruptcy filing.
Shares lost 98 cents, or 33 percent, to close at $1.98 after plummeting to their lowest point in eight years. Its shares were halted for trading seven times Monday. The stock has not closed below $2 since 2003.
A major airline trade group, The International Air Transport Association, said Monday that the industry may be headed for a downturn. American Airlines is considered to be in the most vulnerable financial position of major U.S. carriers.
AMR told CNBC that it is not currently weighing a pre-packaged bankrutpcy protection filing.
Morningstar analyst Basili Alukos said Monday he believes AMR implemented "its last-ditch effort to return to profitability" when it spun-off its regional carrier and said it would place a record order to buy 460 planes to quickly address its aging fleet.
American Airlines is the only major airline that has not filed for bankruptcy protection in the last decade, leaving it saddled with higher costs for everything from labor to financing. American is the only major airline that has lost money this year. Fort Worth, Texas-based AMR lost $286 million in the second quarter alone.
Shares of United Continental Holdings fell 11.7 percent to close at $17.11 on Monday, while Delta Air Lines