Fundamentals to Watch About American Airlines (AAL)

American Airlines Group Inc. (AAL) — Overvalued With Unconvincing Growth Indicators

American Airlines shares moved -31.6% over the last 52 weeks, with a high of $21.42 and a low of $11.65. During this time, the stock lagged the S&P 500 index by -25.0%. As of April 2023, the company's 50-day average price is $15.34. American Airlines Group Inc., through its subsidiaries, operates as a network air carrier. The mid-cap Consumer Discretionary company has 129,700 full time employees and is based in Fort Worth, TX. American Airlines has not offered any dividends in the last year.

Weak Revenue Growth With Decreasing Reinvestment in the Business:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue $45,768,000 $17,337,000 $29,882,000 $48,971,000
Gross Margins 22.7% -43.8% 0.1% 18.4%
Operating Margins 8.1% -63.9% -17.0% 3.7%
Net Income $1,686,000 -$8,885,000 -$1,993,000 $127,000
Net Margins 3.68% -51.25% -6.67% 0.26%
Earnings Per Share $3.79 -$18.36 -$3.09 $0.17
Diluted Shares 444,269 483,888 644,015 652,817
Free Cash Flow -$453,000 -$8,501,000 $496,000 -$373,000
Capital Expenditures -$4,268,000 -$1,958,000 -$208,000 -$2,546,000
Net Current Assets -$51,907,000 -$57,780,000 -$56,446,000 -$55,246,000
Current Ratio 0.45 0.67 0.91 0.71
Long Term Debt $21,454,000 $29,796,000 $35,571,000 $32,389,000
Net Debt / EBITDA 7.17 -3.16 -50.52 16.4

American Airlines Has Elevated P/B and P/E Ratios:

Compared to the Consumer Discretionary sector's average of 22.33, American Airlines has a trailing twelve month P/E ratio of 90.2 and, according to its EPS guidance of $3.08, an expected P/E ratio of 5.0. American Airlines's PEG ratio is -22.21 based on its -4.1% compound average growth rate of historical and projected earnings per share. This indicates that the company's shares are overvalued.

American Airlines Has an Average Rating of Hold:

13 analysts are following American Airlines and have set target prices ranging from $10.0 to $26.0 per share. On average, they have given the company a rating of hold. At the current price of $15.34, AAL is trading -9.7% away from its average analyst target price of $16.98 per share, implying an analyst consensus of strong upside potential for the stock. The company has an above average percentage of its shares sold short since 10.9% of the company's shares are tied to short positions. Institutions own 55.3% of American Airlines's shares, while the insider ownership rate stands at 1.0%. which is a small amount of insider investors. The company's biggest shareholder is the Vanguard Group, Inc. with a 11% stake in the company worth $944,835,378.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.