What happened

Brazilian airline Azul (AZUL 0.17%) has taken investors on a wild ride over the past few months, and Friday was no exception. The airline's shares were up more than 7% in afternoon trading thanks to positive commentary about an airline recovery from a Wall Street analyst.

So what

It's been a difficult few years for airline stocks in general, and for Latin American airlines in particular. The pandemic led to a number of bankruptcies among South American airlines. Azul was able to fly through that turbulence, but has recently been caught up by concerns about how a Chinese debt crisis could impact emerging markets.

A passenger walking through an airport.

Image source: Getty Images.

The debt fears have largely subsided, and on Friday airline stocks were getting a lift from positive commentary from JP Morgan's Jamie Baker. Baker upgraded Southwest Airlines to a buy, and the reasoning he used for the move suggests good times ahead for the entire sector.

Baker was mostly focused on U.S. markets, but he did forecast a gradual return for international travel as well. That, coupled with a steady decline in new COVID cases in Brazil, is helping to push Azul shares higher.

Now what

Azul shares even with Friday's jump are still down nearly 20% over the past three months. The stock is down about 5% for the year, but has seen a number of surges higher and declines during that time.

AZUL Chart

AZUL data by YCharts

Azul is the most attractive Latin American airline choice for investors, and it appears likely the company will have opportunities to take advantage of the bankruptcies of competitors to gain marketshare in Brazil and elsewhere in the region in the quarters to come. But Brazil remains a volatile market that is still not out of the woods in terms of the pandemic, and Azul's stock could have trouble sustaining altitude until conditions on the ground become more certain.

Investors with a long-term mindset are safe boarding at these levels, but would be well-advised to fasten their seatbelts.