HA - Hawaiian Airlines stock flies higher on 'gamechanger' Amazon cargo deal

Hawaiian Airlines ( NASDAQ: HA ) shares marked a double-digit gain on Friday after announcing a new freight agreement with Amazon ( NASDAQ: AMZN ).

Per the terms of the deal, the carrier will operate and maintain 10 Airbus A330s owned by Amazon ( AMZN ) under its FAA certificate. The aircraft, due to enter service in 2023 and 2024, will be utilized to move cargo between airports near the e-commerce giant’s facilities.

The terms also specify that Hawaiian ( HA ) has issued Amazon ( AMZN ) warrants to acquire up to 15% of its common shares. The warrants are exercisable over the next nine years.

JP Morgan analyst Michael Linenberg called the deal “a game-changer” that should help stabilize earnings for the airline.

“We think the Amazon ( AMZN ) business will not improve Hawaiian’s revenue diversification, but help alleviate the earnings volatility that is characteristic of Hawaiian’s passenger business,” he told clients on Friday. “Furthermore, it will represent another source of topline growth for the company.”

Shares of Hawaiian Airlines ( HA ) surged 11.58% in the first hour of US trading on Friday.

Read more on the details of the deal .

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