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American Airlines
(NASDAQ:AAL)
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Rating:46Neutral
Price Target:
$15.00
▲(3.59% Upside)
Action:Reiterated
Date:07/23/26
The score is held down primarily by balance-sheet risk (high debt and negative equity) and weak price momentum (below key moving averages with negative MACD). Offsetting factors include improved TTM free cash flow and strong demand trends highlighted on the earnings call, but near-term profitability and guidance are pressured by significant fuel-cost volatility. Valuation also looks unattractive with a high P/E given inconsistent earnings.
Positive Factors
Broad-based demand & revenue growth
Sustained, broad-based revenue growth across premium, domestic and international routes indicates durable demand and pricing power. Consistent commercial traction (premium, corporate, Pacific/Atlantic strength) supports higher-margin revenue mix and steadier cash generation over coming quarters.
Negative Factors
High leverage & negative equity
Persistently high debt and negative equity materially constrain financial flexibility. In a cyclical airline business this raises refinancing and solvency risk, amplifies earnings volatility through interest costs, and limits the company’s ability to invest or withstand demand shocks without raising costly capital.
Read all positive and negative factors
Positive Factors
Negative Factors
Broad-based demand & revenue growth
Sustained, broad-based revenue growth across premium, domestic and international routes indicates durable demand and pricing power. Consistent commercial traction (premium, corporate, Pacific/Atlantic strength) supports higher-margin revenue mix and steadier cash generation over coming quarters.
Read all positive factors
American Airlines Key Performance Indicators (KPIs)
Any
Passenger Miles
Measures the total distance flown by paying passengers, indicating overall demand and revenue potential from passenger services.
Measures the total distance flown by paying passengers, indicating overall demand and revenue potential from passenger services.
Data provided by:
The Fly
The FlyAmerican Airlines (AAL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.21B
Dividend YieldN/A
Average Volume (3M)142.97M
Price to Earnings (P/E)―
Beta (1Y)1.33
Revenue Growth7.53%
EPS Growth-157.37%
CountryUS
Employees133,100
SectorIndustrials
Sector Strength72
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)-0.49
Shares Outstanding661,970,000
10 Day Avg. Volume141,150,204
30 Day Avg. Volume142,973,354
Financial Highlights & Ratios
PEG Ratio-1.04
Price to Book (P/B)-2.72
Price to Sales (P/S)0.19
P/FCF Ratio-14.89
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$19.79Price Target Upside36.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)0.2
Revenue Forecast (FY)$62.99B
American Airlines Business Overview & Revenue Model
Company Description
American Airlines Group Inc. functions as a prominent network air carrier, delivering scheduled air transportation for both passengers and freight. Its operations are anchored by key hubs located in Charlotte, Chicago, Dallas/Fort Worth, Los Angel...
How the Company Makes Money
American Airlines makes money primarily by selling air transportation and related travel services. The largest revenue stream is passenger revenue from ticket sales across its network; pricing varies by cabin/service class (e.g., premium cabins vs...
American Airlines Earnings Call Summary
Earnings Call Date:Jul 23, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 15, 2026
Earnings Call Sentiment Positive
The call conveyed materially positive commercial momentum — record revenue (+16.3% YoY), strong premium and corporate performance, loyalty growth, operational improvements and solid liquidity — but the narrative was tempered by a severe and volatile fuel-cost shock (≈$2.2B+ in Q2, continued increases into Q3), which forced capacity trims and weakened near-term earnings guidance. Management emphasized cost discipline, network optimization and confidence in longer-term margin expansion once fuel normalizes.Positive Updates
Record Quarterly Revenue
Total revenue increased 16.3% year-over-year, delivering a record quarterly revenue result and broad-based strength across cabins and regions.
Negative Updates
Surging Fuel Costs and Volatility
Fuel expense rose over $2.2 billion (≈83% YoY) in Q2; since early July expected Q3 fuel expense increased by >$700 million and nearly $1.6 billion for the remainder of the year, with recent weekly moves adding ~$230 million to Q3 and ~$550 million to the remainder—creating substantial near-term headwinds.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Revenue
Total revenue increased 16.3% year-over-year, delivering a record quarterly revenue result and broad-based strength across cabins and regions.
Read all positive updates
Company Guidance
American updated 2026 guidance with a Q3 adjusted loss per diluted share of $0.70 to $0.10 and full‑year adjusted EPS of a loss of $0.65 to a profit of $0.65 (midpoint roughly breakeven), with Q3 total revenue growth expected +16% to +19% YoY and unit revenue said to be stronger in Q3 and Q4 versus Q2. They now expect Q3 capacity +3% to +5% YoY (≈2 points lower at the midpoint versus the original plan) and CASMx up 2.5%–4.5% YoY (slightly elevated due to capacity reductions); Q2 fuel expense rose by >$2.2B (≈+83% YoY) and management warned of an expected ~+$6B YoY fuel headwind for the full year — as of the July 21 forward curve Q3 fuel is modeled at about $3.75/gal (implying ~+$1.7B YoY in Q3) and since early July fuel assumptions have increased by >$700M for Q3 and ~+$1.6B for the remainder (including a recent weekly bump of ~$230M for Q3 and ~$550M for the rest of the year). They ended Q2 with $11.3B of liquidity, expect to take 48 aircraft in 2026, plan ~ $4B of CapEx this year (≈$4.5B in 2027), and at the midpoint anticipate positive free cash flow and lower net debt by year end.American Airlines Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
22
Negative
Cash Flow
63
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 58.34B | 54.63B | 54.21B | 52.79B | 48.97B | 29.88B |
| Gross Profit | 12.26B | 10.47B | 11.46B | 11.81B | 9.04B | 27.00M |
| EBITDA | 3.34B | 3.88B | 5.01B | 5.20B | 4.13B | 1.59B |
| Net Income | -326.00M | 111.00M | 846.00M | 822.00M | 127.00M | -1.99B |
Balance Sheet | ||||||
| Total Assets | 64.23B | 61.77B | 61.78B | 63.06B | 64.72B | 66.47B |
| Cash, Cash Equivalents and Short-Term Investments | 7.77B | 6.57B | 6.98B | 7.58B | 8.96B | 12.43B |
| Total Debt | 35.73B | 35.97B | 37.54B | 40.66B | 43.69B | 46.18B |
| Total Liabilities | 68.20B | 65.50B | 65.76B | 68.26B | 70.52B | 73.81B |
| Stockholders Equity | -3.97B | -3.73B | -3.98B | -5.20B | -5.80B | -7.34B |
Cash Flow | ||||||
| Free Cash Flow | 285.00M | -680.00M | 1.30B | 1.21B | -373.00M | 496.00M |
| Operating Cash Flow | 4.37B | 3.10B | 3.98B | 3.80B | 2.17B | 704.00M |
| Investing Cash Flow | -2.85B | -1.89B | -968.00M | -502.00M | 636.00M | -5.98B |
| Financing Cash Flow | -1.30B | -1.05B | -2.79B | -3.21B | -2.63B | 5.29B |
American Airlines Risk Analysis
American Airlines disclosed 41 risk factors in its most recent earnings report. American Airlines reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
American Airlines Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $58.26B | 14.38 | 19.33% | 0.91% | 10.28% | -12.67% | |
70 Outperform | $40.11B | 11.32 | 22.50% | ― | 8.48% | 6.74% | |
68 Neutral | $30.08B | 13.56 | 20.27% | 1.74% | 13.24% | -1.27% | |
64 Neutral | $15.37B | 9.17 | 126.90% | 3.05% | 16.19% | 62.18% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $22.31B | 27.09 | 11.27% | 1.60% | 9.46% | 137.74% | |
46 Neutral | $10.21B | -31.16 | 8.29% | ― | 7.53% | -157.37% |
* Industrials Sector Average
AAL
American Airlines
15.27
4.24
38.44%
DAL
Delta Air Lines
87.44
36.84
72.82%
RYAAY
Ryanair Holdings
58.51
-2.92
-4.76%
LUV
Southwest Airlines
44.97
15.72
53.74%
UAL
United Airlines Holdings
121.33
36.76
43.47%
LTM
LATAM Airlines Group SA Sponsored ADR
52.76
10.77
25.65%
American Airlines Corporate Events
Business Operations and StrategyFinancial Disclosures
American Airlines Posts Record Q2 Revenue Amid Fuel Costs
Positive
Jul 23, 2026
On July 23, 2026, American Airlines reported second-quarter 2026 results featuring record revenue of $16.7 billion, up 16.3% year over year, and GAAP net income of $71 million, as strong demand across premium and Main Cabin, domestic and internati...
Business Operations and StrategyExecutive/Board Changes
American Airlines Announces Retirement of Vice Chair Johnson
Neutral
Jun 16, 2026
On June 14, 2026, American Airlines Group Inc. announced that Stephen L. Johnson, its Vice Chair and Chief Strategy Officer, plans to retire at the end of the year after more than three decades in the airline industry. Johnson, who first joined th...
Executive/Board ChangesShareholder Meetings
American Airlines Investors Approve Expanded Incentive Award Plan
Positive
Jun 10, 2026
At its 2026 Annual Meeting of Stockholders held on June 10, 2026, American Airlines Group secured shareholder approval for an amended and restated 2023 Incentive Award Plan, increasing the share pool by 16.5 million common shares and allowing cert...
Business Operations and StrategyPrivate Placements and Financing
American Airlines Refinances Term Loans, Extends Debt Maturities
Positive
May 29, 2026
On May 29, 2026, American Airlines, Inc. and American Airlines Group Inc. amended their existing Amended and Restated Credit and Guaranty Agreement, refinancing in full the prior term loans and incurring new 2026 Term Loans totaling about $1.85 bi...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.