The American Airlines Group Inc. is a publicly traded airline holding company with its headquarters in Fort Worth, Texas. It was founded through the merger of two airline companies, the AMR Corporation and US Airways Group. Today, the company offers more than 50 destinations in 50 countries around the world. Investors can purchase American Airlines stock to gain exposure to the airline industry.
The company has recently reported a lower-than-expected Q1 loss, and management provided a positive outlook for the rest of the year. They attributed the improvement to strong demand during the summer months and limited capacity, which helped offset higher fuel costs. Investors have reacted positively to the news. JP Morgan upgraded American stock to neutral from underweight, while Argus raised it to buy from hold. Deutsche Bank kept its buy rating and raised the price target to $25 from $20.
While American Airlines is beginning to return to profitability, it still faces long-term headwinds that will likely be difficult to overcome, including rising jet fuel prices and a tight labor market. This means that the airline is unlikely to see a quick rebound in the near future. The airline industry is still struggling, but different markets will rebound at different rates.
Investors who want to invest in the stock market should consider the AAII’s proprietary stock grades. These grades are easy to understand and use and measure five factors that can affect a stock’s value. Buying stocks that are undervalued is often a good strategy. However, it is essential to consider the intrinsic value of the stock.