American Airlines (AAL) Dips More Than Broader Markets: What You Should Know

Highs and Lows Stock Data

American Airlines (AAL) closed at $36.29 in the latest trading session, marking a -0.77% move from the prior day. This change lagged the S&P 500's daily loss of 0.15%. Meanwhile, the Dow gained 0.21%, and the Nasdaq, a tech-heavy index, lost 0.81%.

Heading into today, shares of the world's largest airline had gained 13.89% over the past month, outpacing the Transportation sector's gain of 9.47% and the S&P 500's gain of 6.55% in that time.

AAL will be looking to display strength as it nears its nex t earnings release, which is expected to be April 25, 2019. On that day, AAL is projected to report earnings of $0.68 per share, which would represent a year-over-year decline of 9.33%. Our most recent consensus estimate is calling for quarterly revenue of $10.83 billion, up 4.13% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.90 per share and revenue of $46.72 billion, which would represent changes of +29.67% and +4.89%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for AAL. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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, the Zacks Consensus EPS estimate has moved 6.22% higher. AAL is currently a Zacks Rank #2 (Buy).

In terms of valuation, AAL is currently trading at a Forward P/E ratio of 6.2. For comparison, its industry has an average Forward P/E of 9.61, which means AAL is trading at a discount to the group.

Also, we should mention that AAL has a PEG ratio of 1.21. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Transportation - Airline stocks are, on average, holding a PEG ratio of 0.89 based on yesterday's closing prices.

The Transportation - Airline industry is part of the Transportation sector. This group has a Zacks Industry Rank of 10, putting it in the top 4% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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