Wheels Up, a beleaguered “on-demand” private jet service, had the unfortunate achievement of being the most volatile US stock worth more than $2 billion for the last month.
According to FinViz data, the price of Wheels Up shares moved +36%, +7%, +23%, -24%, and +11% in just the past five days, Sherwood News reported.
That’s even worse than GameStop, which saw significant volatility in the past few months thanks to the Roaring Kitty meme stock rally, which sent shares up 60% in May. Shares for GameStop reached $48.75 on May 14, only to go back down to $18.32 on May 23, then back up to $46.55 on June 6 before stabilizing at around $24.
Sherwood cited two main reasons for Wheels Up’s volatility: it’s not clear if the company’s business plan is viable long-term and only a fraction of its shares are publicly tradable.
Wheels Up went public in 2021 and its stock is now down more than 95% from its height.
Last year the company reported more than $1.2 billion in revenue, but that didn’t offset its almost $1.7 billion operating costs, Sherwood said.
The company did get a $500 million infusion of cash from Delta last year, but even that couldn’t stop it from bleeding cash.
Its year-over-year revenue was almost halved in the first quarter and it confirmed in June that it laid off about 11% of its pilots, according to Private Jet Card Comparisons.
Executives have said they expect the company to be profitable by the end of the year. It currently has a fleet of about 170 aircraft.
Delta Air Lines CEO Ed Bastian said he believes “the next step of premium is private,” which is why he has faith in Wheels Up.
“No airline has ever had a private experience at scale, and this is what we’re building at Wheels Up,” he explained.