What happened

Shares of Astronics (NASDAQ:ATRO) were trading up by about 11% as of 11:30 a.m. Monday, benefiting from a pair of analyst upgrades delivered on Friday. The aerospace-industry supplier was hit hard by both the coronavirus pandemic and the grounding of Boeing's (NYSE:BA) 737 MAX, but should benefit from a gradual normalization of the aviation sector once the pandemic is brought under control.

So what

Astronics' shares as of late October had lost more than 75% of their value year to date. The company supplies a range of components for the 737 MAX and does a lot of work refurbishing aircraft interiors. Passenger travel may have rebounded somewhat from its earlier depths, but still, less than half as many travelers are boarding planes each day now as did so in November 2019. So airlines have a lot less money available for interior upgrades.

A plane in the hanger receiving upgrades.

Image source: Getty Images.

But the stock has nearly doubled so far this month, fueled by optimism for airlines thanks to the latest developments in the race to find effective COVID-19 vaccines and the 737 MAX's return to service after a 20-month grounding.

Wall Street believes the stock's rally is justified. Canaccord Genuity analyst Kenneth Herbert on Friday upgraded Astronics to buy from hold and set a $15 price target, still about 20% above where the stock was trading on Monday morning. Herbert said progress on the vaccine front indicates "we are in the early innings of what ideally is a steady recovery in air travel."

CJS Securities analyst Jonathan Tanwanteng also climbed aboard, upgrading Astronics to outperform from market perform and setting a $16 price target on the stock.

Now what

Astronics has been one of the more beaten-down stocks in what has been a terrible period for the commercial aerospace sector. With the beginning of the end of the pandemic in sight, it makes sense for investors to give the stock a second look.

That said, we are still in the early days of a potential recovery that will likely take years to play out. A lot of Astronics' interiors business is going to be on hold as airlines focus on rebuilding their bruised balance sheets and regaining altitude.

Astronics was a $20 stock prior to the pandemic, so there is good potential for further appreciation as the sector gets back to normal. Just be warned that normalization will take time, and in the near term, there is only so much the company can do.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.