Consider Buying American Airlines Stock (AAL) Before Earnings Report
American Airlines (AAL) is preparing to release its Q3 earnings report on October 23, prior to market opening. Analysts project an earnings per share (EPS) of -$0.28 with revenues anticipated at $13.63 billion. These figures indicate a decrease from the previous year’s earnings of $0.30 and revenues of $13.65 billion. Such declines are attributed to softer unit revenue trends across both domestic and international markets.
Previous Quarter Performance
In Q2, American Airlines reported an adjusted EPS of $0.95, exceeding estimates while achieving record revenues of $14.39 billion. However, the airline indicated a softer demand, flat pricing, and rising costs as challenges impacting its performance heading into Q3.
Track Record and Key Metrics
Historically, AAL has demonstrated a strong performance in beating earnings expectations, missing only twice in the last 16 quarters. Investors should also monitor additional metrics such as passenger enplanements, which reflect the number of passengers boarding flights. This measure offers valuable insights into demand trends and market share growth. Notably, post-pandemic, AAL has experienced an upward trend in this metric.
Market Expectations and Analyst Ratings
- Earnings Move: Options traders anticipate a 6.4% price movement in either direction following the earnings report.
- Consensus Rating: Analysts maintain a Moderate Buy consensus on AAL stock, comprising five Buy ratings, eight Hold ratings, and one Sell rating.
- Price Target: The average price target for AAL is $14.42, suggesting a 19% potential upside from current levels.
- AI Analyst Rating: The AI analyst from TipRanks holds a Neutral rating with a price target of $12.50.
As AAL prepares for its earnings announcement, investors are advised to stay informed and consider the implications of these anticipated results on their investing strategies.
