American Airlines plans another $1 billion stock sale after big rally

American Airlines flight 718, the first U.S. Boeing 737 MAX commercial flight since regulators lifted a 20-month grounding in November, takes off from Miami, Florida, December 29, 2020.

Marco Bello | Reuters

American Airlines authorized the sale of another $1 billion in stock, the carrier said in a filing Friday, an effort to shore up cash as Covid-19 continues to depress travel demand.

American authorized a $1 billion stock sale in October and sold $882.4 million at $12.87 a share. Under the new agreement, it would sell up to $1.12 billion.

American’s decision comes on the heels of a sharp rally in its stock price earlier this week after it was mentioned in the popular WallStreetBets Reddit forum. The airline declined to comment on whether the stock move factored into its decision.

American’s shares were down almost 7% in afternoon trading on Friday. Other airline stocks were also sharply lower. The Fort Worth, Texas-based carrier and Southwest Airlines each reported record 2020 losses on Thursday.

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