American Airlines Group (AAL) stock was down 9.2% in Wednesday morning trading after the carrier’s updated profit outlook fell short of expectations for the first quarter.
American Airlines said it expects to post adjusted earnings per share of between one and five cents when it reports earnings later this month. That’s an improvement on its previous guidance of approximately break-even, but it falls below analysts’ expectations of five cents per share, according to FactSet data.
“In general, estimates have been trending higher over the past few weeks, although it appears as though some estimates were too aggressive,” Cowen analysts, led by Helane Becker, wrote Wednesday. They updated their own estimates on American Airlines to a profit of four cents per share from a loss of six cents per share.
The carrier also said it expects total revenue per available seat mile (TRASM)—an industrywide metric—to climb 25.5% compared with the first quarter of 2022, at the midpoint of its prior 24%-27% guidance. American is expected to report first-quarter earnings on April 20. “The key that day will be forward guidance, which should be fairly robust, even with the accruals for labor contracts that they may discuss,” the team said.
Delta Air Lines (DAL) will be the first airline to report first-quarter earnings on Thursday, with the focus for investors likely to be on whether demand can stay strong heading into the summer months and, in particular, on second-quarter guidance.
American Airline Stock Report– After an impressive start to the year, airline stocks have moved lower in the past month, as a number of factors, including the regional-banking turmoil and higher oil prices, have hurt sentiment. AAL has not done well compared to other similar stocks during the last 12 months, returned -15.09% in the last 12 months. Do you think this is a buying opportunity? AAL is approaching 5 year lows!
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