Delta stock continues nose dive after loss warning

<p>Delta Air Lines Inc.'s battered stock continued its nose dive Wednesday following the company's warning about further losses and the possibility of bankruptcy.</p><p>Shares of the nation's third-largest carrier fell 26 cents, or 8.8 percent, to $2.71 in afternoon trading on the New York Stock Exchange.</p><p>If that figure holds, it would be the lowest close of the company's stock in at least 25 years.</p><p>In a Securities and Exchange Commission filing issued Tuesday, Delta warned it will record a substantial loss for the rest of the year and will need to file for bankruptcy if its cash reserves fall too low or lenders seek immediate payment of its debts.</p><p>Some analysts reduced their expectations for the airline following the warning.</p><p>In a research note issued Wednesday, analyst Bob McAdoo of Prudential Equity Group LLC said his firm has been concerned "for some time" that the list of steps being taken in Delta's transformation plan is insufficient to fix the airline's problems. He said the firm has reduced its price target for Delta's stock from $9 to $1.</p><p>In the SEC filing, Delta said that it is considering several moves to keep itself afloat, including more cost cuts and potential asset sales. But even that may not be enough, Delta said.</p><p>Delta, which reported a nearly $1.1 billion loss in the first quarter, had $1.8 billion in unrestricted cash at the end of March. But the airline said in the filing that it expects that its cash level will be substantially lower by the end of the year if it can't increase revenue, cut more costs, sell assets or restructure debt.</p><p>Delta's 52-week low for its stock is $2.93, the closing price on Oct. 20, 2004, around the time the airline almost fell into bankruptcy before winning deep concessions from pilots and fresh financing from creditors. Wednesday's afternoon price is the lowest the stock has traded at since Jan. 2, 1980, according to financial Web sites that keep track of such figures. A company spokesman could not immediately say if the stock is at its lowest point ever.</p><p>___</p><p>On the Net:</p><p>HASH(0x1cdcad0)</p>