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Primecap Can Ride Out Its Airline Stocks' Turbulence

The firm has been here before.

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The coronavirus’ economic fallout has hit investors in airline stocks especially hard, perhaps none more so than Pasadena-based Primecap Management Company. At year-end 2019, Primecap firmwide owned 14% to 16% of the shares outstanding in three different airlines and stakes in nine other air carriers. As Exhibit 1 shows, shares of each of these airlines shed between 40.7% and 76.1% during the depths of this still-unfolding bear market (Feb. 20, 2020, to March 23, 2020), versus a 33.8% drop for the S&P 500 index.

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Alec Lucas has a position in the following securities mentioned above: POAGX, PFE. Find out about Morningstar’s editorial policies.