UP - BTIG steps to the sidelines on Wheels Up after CEO shuffle

2023-05-10 10:05:59 ET

BTIG  downgraded Wheels Up Experience ( NYSE: UP ) to Neutral after earnings raised some eyebrows and the company’s founder relinquished his role as CEO.

Equity analyst Marvin Fong noted that the Q1 results missed his estimates and also highlighted continued cash burn as a key concern. Further, with some notable shifts in the executive ranks and a reorientation of company strategy , he advised a wait and see approach is more appropriate at present.

“Our overall thoughts, while mixed, skew negative. We believe the change in strategy is the type of medicine UP has been needing, but the worst of the macro downturn is likely still ahead of us, competition is intensifying and the cash runway will likely be an overhang for some time,” Fong concluded. “While current shareholders may want to see their investments through, with all of the changes and the increasingly uncertain cash outlook, we believe prospective new investors should take a wait-and-see approach.”

Fong also withdrew his price target which previously stood at $2.50. Shares of Wheels Up ( UP ) dipped 1.8% shortly after Wednesday’s market open, adding to a steep tumble on Tuesday .

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