In the latest trading session, American Airlines (AAL) closed at $15.35, marking a -4.06% move from the previous day. The stock's change was less than the S&P 500's daily loss of 0.19%. At the same time, the Dow lost 0.8%, and the tech-heavy Nasdaq lost 0.1%.
Heading into today, shares of the world's largest airline had gained 4.37% over the past month, outpacing the Transportation sector's gain of 1.45% and the S&P 500's gain of 2.26%.
The upcoming earnings release of American Airlines will be of great interest to investors. The company's earnings per share (EPS) are projected to be $0.38, reflecting a 55.81% decrease from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $14.07 billion, showing a 3.02% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $0.56 per share and revenue of $54.67 billion. These totals would mark changes of -71.43% and 0%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for American Airlines. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, there's been a 7.76% rise in the Zacks Consensus EPS estimate. Currently, American Airlines is carrying a Zacks Rank of #3 (Hold).
Investors should also note American Airlines's current valuation metrics, including its Forward P/E ratio of 7.94. Its industry sports an average Forward P/E of 9.93, so one might conclude that American Airlines is trading at a discount comparatively.
Also, we should mention that AAL has a PEG ratio of 0.56. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As the market closed yesterday, the Transportation - Airline industry was having an average PEG ratio of 0.6.
The Transportation - Airline industry is part of the Transportation sector. This industry currently has a Zacks Industry Rank of 183, which puts it in the bottom 26% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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American Airlines Group Inc. (AAL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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