Delta shares downgraded on Southwest plans for Atlanta

Raymond James analyst Duane Pfennigwerth wrote in a report Monday that the entry of Southwest  into Atlanta with intentions to grow "represents a significant change in the competitive landscape." Atlanta-based Delta is the largest carrier in Atlanta, while AirTran is second-largest.

In the report downgrading Delta shares to "market perform" from "outperform," he added that Southwest is "a more serious threat than a retreating AirTran."

But not all analysts agree. A J.P. Morgan analyst wrote in a report last week that Delta is "not uniquely threatened," because cities Southwest may add service to from Atlanta that are not already served by AirTran represent less than 1 percent of Delta's overall business.

Hudson Securities analyst Daniel McKenzie wrote in a report last week that the news of the Southwest-AirTran deal is an "incremental negative" for Delta, but "not to the extent some fear."

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