In the latest trading session, American Airlines (AAL) closed at $13.07, marking a -6.24% move from the previous day. This move lagged the S&P 500's daily loss of 0.43%. On the other hand, the Dow registered a loss of 1.05%, and the technology-centric Nasdaq decreased by 0.92%.
Shares of the world's largest airline witnessed a gain of 3.18% over the previous month, trailing the performance of the Transportation sector with its gain of 11.09%, and outperforming the S&P 500's loss of 0.5%.
Market participants will be closely following the financial results of American Airlines in its upcoming release. The company's earnings per share (EPS) are projected to be -$0.28, reflecting a 52.54% increase from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $13.62 billion, up 8.5% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $2.18 per share and revenue of $59.46 billion, which would represent changes of +505.56% and +8.84%, respectively, from the prior year.
Any recent changes to analyst estimates for American Airlines should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 3.15% 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 6.41. For comparison, its industry has an average Forward P/E of 9.92, which means American Airlines is trading at a discount to the group.
We can additionally observe that AAL currently boasts a PEG ratio of 0.54. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Transportation - Airline stocks are, on average, holding a PEG ratio of 0.58 based on yesterday's closing prices.
The Transportation - Airline industry is part of the Transportation sector. At present, this industry carries a Zacks Industry Rank of 21, placing it within the top 9% of over 250 industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
American Airlines Group Inc. (AAL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
