United Air shares fall the most in 8 years on Thursday as fourth-quarter performance forecasts disappoint

Shares of United Continental Holdings Inc experienced massive selling pressure yesterday, plummeting at a daily rate unseen in eight years, after the company released disappointing fourth-quarter forecasts on performance.

United Air shares closed lower for the second time in the past five trading sessions on Thursday. It has also been the sharpest daily loss since October 21st 2009. The stock went down 12.08% ($8.21) to $59.78, after touching an intraday low at $59.56, or a price level not seen since September 26th ($59.30).

In the week ended on October 15th the shares of the transportation company added 3.56% to their market value compared to a week ago, which marked a third consecutive period of gains.

However, due to yesterdays retreat, the stock has neutralized earlier advance and is now down 1.81% so far during the current month, following a 1.74% drop in September. The latter has been a fourth consecutive month of losses.

For the entire past year, United Air shares gained 27.19%. On the other hand, the stock has retreated 17.97% so far in 2017.

The carrier said it projects a drop of between 1% and 3% in its passenger revenue per available seat mile during the last quarter of the year. The forecast contrasted the growth estimate by investors and analysts.

At the same time, the company expects a pre-tax margin of between 3% and 5% during the current quarter, or a figure well below the median forecast by analysts, based on the fourth-quarter guidance provided by another of the leading carriers, Delta Air Lines.

Earlier this week United Air reported a pre-tax loss of $185 million during the third quarter as a result of canceled flights during the brutal hurricane season.

The carriers fourth-quarter results could be adversely affected by a number of factors such as shifts in holiday travel demand to January from December as well as firmer competition from ultra-low-cost airlines in some hubs.

According to CNN Money, the 18 analysts, offering 12-month forecasts regarding United Air’s stock price, have a median target of $72.00, with a high estimate of $110.00 and a low estimate of $60.00. The median estimate is a 20.44% surge compared to the closing price of $59.78 on October 19th.

The same media also reported that 11 out of 20 surveyed investment analysts had rated United Air’s stock as “Hold”, while 7 – as “Buy”.

Daily and Weekly Pivot Levels

With the help of the Camarilla calculation method, todays levels of importance for the United Air stock are presented as follows:

R1 – $60.44
R2 – $61.09
R3 (Range Resistance – Sell) – $61.75
R4 (Long Breakout) – $63.72
R5 (Breakout Target 1) – $66.02
R6 (Breakout Target 2) – $66.97

S1 – $59.12
S2 – $58.47
S3 (Range Support – Buy) – $57.81
S4 (Short Breakout) – $55.84
S5 (Breakout Target 1) – $53.54
S6 (Breakout Target 2) – $52.59

By using the traditional method of calculation, the weekly levels of importance for United Continental Holdings Inc (UAL) are presented as follows:

Central Pivot Point – $67.19
R1 – $70.00
R2 – $72.42
R3 – $75.23
R4 – $78.03

S1 – $64.77
S2 – $61.96
S3 – $59.54
S4 – $57.11