According to a 13F filing, Appaloosa Management’s largest sale in 2Q16 was Southwest Airlines (LUV). It sold 0.88 million shares of the company. As of June 30, 2016, it holds 3.4 million shares with a market value of $128.2 million. Southwest Airlines constituted 3.2% of the firm’s portfolio. Appaloosa Management owned 0.6% of Southwest’s holdings.
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The firm removed 0.88 million shares of Southwest Airlines from its holdings in 2Q16. The airline companies are struggling with some genuine issues like terrorism and open-sky agreements. Terrorist attacks like the Paris attack, the Brussels attack, and other terror attacks in the recent past have left travelers insecure, which directly affects airline operators. Plus, the United Kingdom (EWU) leaving the European Union (EZU) (VGK) (IEV) could end most of the open-sky agreement in that region and thus make tickets costlier for travelers.
On a year-to-date basis, Southwest Airlines (LUV) fell 15.7% as of August 23, 2016. Southwest Airlines shares witnessed a steep fall before and after the Brexit referendum in June 2016.
In the next part of this series, we will analyze the holdings of Elliott Management as of June 30, 2016.