File this one under “because prices never go down,” but airline stock United Airlines (UAL) is hiking some fees. Those with United credit cards or frequent visitors of United lounges are set to be on ground zero for these new hikes. Shareholders were over the moon, though, and sent shares blasting up nearly 6% in Monday morning’s trading.
Starting today, the reports noted, individual memberships for United Club lounge access goes to $750 per year, up from the previous figure of $650. Conversely, those with 94,000 United loyalty points can also get in on the annual plan. But that is just for one passholder; those who want to bring a guest—or up to two—will need to shell out $1,400 for the year, or 175,000 points.
Meanwhile, the credit card will see its annual fee for the United Explorer card go from $95 to $150 per year, but offers a $60 rideshare credit. United Quest goes from $250 per year to $350, but offers $100 in rideshare credits. The head of United’s MileagePlus loyalty program, Richard Nunn, noted that United strove to be “…very, very cognizant of ensuring that the value increments and the benefits that are delivered outweigh any increase in the cost of those cards.”
Never Fight a Mama Bear
Meanwhile, United spent a little time recently poking a bear, rather, a mama bear in the form of a mother who took a United flight with her two year old son. The two year old was on a ventilator, and apparently, United flight crew staff tried to require the ventilator be removed. The mother in question produced medical documents illustrating the device was required, but this seemed to cut little ice with the flight crew, who persisted in their demands.
United, for its part, promptly apologized, but the mother in this case dismissed the apology, declaring it “…not sincere.” But this comes not long after a different United flight in which two Jewish passengers asserted that United “…forcibly removed one of them from the bathroom,” and then “…made discriminatory remarks about their religion.”
Is United Airlines a Buy, Sell or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on UAL stock based on 16 Buys assigned in the past three months, as indicated by the graphic below. After a 73.63% rally in its share price over the past year, the average UAL price target of $130 per share implies 64.77% upside potential.
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