Earnings Preview: United Airlines Stock Vulnerable to Downgrades

United Airlines Holdings Inc (NASDAQ) is preparing to report third-quarter earnings after the close on Tuesday, Oct. 20. Zacks Consensus Estimates call for earnings of $2.60 per share, down 6.5% year over year, while revenue is expected to rise 17.2% to $17.84 billion.

United stock was last seen up 0.9% at $99.83. Thanks to a 16% three-month drawdown the shares have breached their 50- and 60-day moving averages. Year to date, the airline heavyweight is now down 10.7%. 

The company has an impressive history of topping earnings expectations, beating analysts' per-share estimates in 11 of its last 12 quarterly reports and matching estimates once. However, that success hasn't always translated to post-earnings gains. The stock finished higher after just five of those reports, averaging a 5.6% move, regardless of direction. More recently, UAL fell 1.8% in July and 5.6% in April.

Analyst sentiment is overwhelmingly bullish. Of the 25 brokerages in coverage, 23 carry "buy" or better ratings, while the consensus 12-month price target of $151.11 is a 52% premium to its current perch. Another lackluster post-earnings outing could prompt analysts to change their tune.