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Don’t you hate it when you have a bad day at work, causing your company’s stock to lose $2.5 billion in value? Well, United CEO Oscar Munoz feels your pain.
Thursday morning, the airline had its quarterly earnings call, and Munoz and the rest of the management team bungled at least one question from an analyst. When pressed for details about how United plans to compete with low-fare carriers, Munoz said the airline had “dug ourselves in a hole” and asked for patience.
However, institutional investors — which hold around 99% of United’s shares — aren’t known for having patience. The blowback was quick with headlines calling the earnings call “disastrous” and Stifel stock analyst Joseph DeNardi headlining his report “Is This a Catalyst for Management Change?”
This wouldn’t be Oscar Munoz’s first time in the crosshairs. After he botched the initial response to April’s Dr. Dao incident, there were calls for him to step down. While the security officers involved in the situation were fired this week, no one at United would be fired for the incident.
And the stock price tumbled. As of the close of Thursday’s trading session, United stock lost 12.08% to finish at $59.78 per share. This loss takes $2.5 billion from the airline’s market valuation. This leaves United as the fourth most-valuable US airline behind Delta, American Airlines and Southwest — which all posted small losses (1.12%, 1.00% and 0.34%, respectively) on the day.
The loss furthers the drop for a company that is having trouble inspiring confidence in investors. Since June 2nd, United stock has lost over 27%. In the same time, American Airlines has gained 4% and Delta’s stock is up 2.1%.
Featured image by Antonio Perez/Chicago Tribune/TNS via Getty Images
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