) to outperform from neutral.
Analyst James Higgins is tilting his bias in the airline group toward more leverage in what he expects to be a gradually improving economy. He cited a substantial increase in his liquidity forecast for Continental, driven by the explicit recognition of a potential benefit of the sale of the carrier's 53.1% stake in ExpressJet Holdings. He estimates that the year-end 2003 liquidity potential for Continental could be as high as about $1.3 billion.
Higgins also cited Continental's relatively strong operating cash flows, which have been driven by its comparatively low costs and superior revenue momentum. He maintains his $16 12-month target.