JetBlue Airways shares have jumped in recent months, but Citi warns that this trend might not last because of rising geopolitical risks and a high valuation.
On Friday, Citi downgraded JetBlue, saying the risks now outweigh the potential rewards, even though the stock is still about 4% below its 52-week high as of Thursday.
The downgrade hurt JetBlue’s stock on Friday. Shares fell 3.6% in early trading, while the broader market saw a small gain.
JetBlue shares rose 36% in 2026 through Thursday, helped by steady travel demand, cost cuts, and new routes after Spirit Airlines collapsed. However, Citi thinks these gains might not last.
Citi warned that leisure travel demand could drop if the conflict in the Middle East leads to higher inflation. Airlines like Delta and United, which have more business and premium travelers, may handle this better. But Citi expects JetBlue’s revenue per available seat mile—a key measure of airline profitability—to face pressure.
Citi also raised concerns about JetBlue’s valuation. The airline aims for at least $1 per share in earnings by 2028, and its stock trades at a similar level to other airlines based on that goal. Citi said that even if JetBlue meets its target, the stock price already seems to reflect most of that expected growth.
