Please ensure Javascript is enabled for purposes of website accessibility

Why Republic Airways Holdings Inc.'s Shares Plunged 16% Today

By Travis Hoium - Oct 7, 2015 at 1:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The pilot dispute is coming back to bite Republic Airways Holdings Inc. today.

What: Shares of Republic Airways Holdings Inc. (NASDAQ: RJET) plunged as much as 16% today after it was sued by partner Delta Air Lines (DAL -0.36%).

So what: Republic Airways said that it is aware of "a complaint filed by Delta" but hasn't yet been served or received the full complaint. According to reports, Delta has sued over Republic Airways failing to supply a full schedule of flights, causing Delta to find replacement flights, rebook customers, and issue refunds.  

This is likely fallout from the company's recent dispute with pilots, which left the airline understaffed.  

Now what: It's not surprising that there's some disputes between Republic Airways and its partners over operational challenges the company has had recently. But a recent tentative agreement with pilots should bring some stability to the company and its operations. It was also reported that Delta's losses because of the disruption were only $1 million, so even the impact of a settlement would likely be small. I don't see this as a reason to run from Republic Airways today.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Delta Air Lines, Inc. Stock Quote
Delta Air Lines, Inc.
DAL
$30.33 (-0.36%) $0.11

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.