Is It Safe to Buy Airline Stocks Right Now?

Airlines have been hit hard by the COVID-19 pandemic, sending stocks crashing down and causing Warren Buffett to run for the emergency exits. Airlines today are trading at valuations that suggest they might not survive, and many prominent industry watchers are worried they might not.

Boeing, which counts on the airlines for the bulk of its revenue, is expecting the worst. During a May 12 television interview, CEO David Calhoun said a "major U.S. carrier" will "most likely" go out of business this year, predicting an extended decline in travel.

"Something will happen when September comes around. Traffic levels will not be back to 100%, they won't even be back to 25%," Calhoun said. "Maybe by the end of the year we approach 50%. So, there will definitely have to be adjustments that will have to be made by the airlines."