Upbeat passenger volumes bode well for the Zacks Transportation -Airline industry. Stocks like UAL, AAL and ALK appear to be good bets currently.
Evercore ISI raised the firm's price target on American Airlines to $18 from $13 and keeps an In Line rating on the shares. Across the firm's airlines and lodging coverage, the analyst believes the post-election demand pickup was "quicker and stronger vs. initial expectations" and that the compressed period between Thanksgiving and peak Holidays, combined with a dose of late-year corporate travel, also likely contributed to stronger outcomes, says the analyst as the firm adjusting airline estimates and rolling its price targets to a 2026 basis.
The final trades of the day with CNBC's Melissa Lee and the Fast Money traders.
Shares of American Airlines Group (AAL) surged Monday after brokerage firms Jefferies and TD Cowen upgraded their ratings and raised their price targets on the carrier's stock.
Sheila Kahyaoglu, Jefferies aerospace and defense analyst, joins CNBC's The Exchange to discuss why her firm increased the price target on American Airlines to $20 from $12, her take on other airlines, and more.
Analysts say headwinds from 2024 were transitory.
The airline industry is calling some of the most bullish outlooks from Wall Street analysts right now, and while some investors may be confused by this behavior, recent travel activity—and numbers—justify taking another look at these transportation stocks and whether they can actually deliver on the perceived momentum for 2025. This is where today's list of airline stocks comes into play.
American Airlines Group Inc (NASDAQ:AAL) stock is up 4.5% to trade at $17.72 this morning, after TD Cowen and Jefferies both issued upgrades to "buy," with respective price-target hikes to $25 and $20, from $17 and $12.
Melius Research upgraded American Airlines to Buy from Hold with a price target of $23, up from $18. TD Cowen and Jefferies also upgraded American this morning. The firm says that given its "constructive view" of the U.S. airline industry in 2025, American at current share levels is "appealing." Melius sees above-industry unit revenue growth for American and "additional optionality" in regaining lost corporate share. While concerns remain on the company's balance sheet, "idiosyncratic" margin improvement in 2025 will make the balance sheet issues "become much more fixable," contends Melius. Shares of American Airlines are up 5%, or 77c, to $17.74 in morning trading after three firms upgraded the name.
Investors should monitor stocks like American Airlines, ABM, A.P. Moller-Maersk, Delek US Holdings and Asbury for high returns.
U.S. airline stocks saw significant stock growth in 2025 with American Airlines outperforming in December 2024. AAL's strategic focus on the southern U.S. and premium domestic travel, coupled with a new exclusive credit card partnership, supports future revenue growth. AAL's fleet modernization, including the Airbus A321XLR, and strong transatlantic joint ventures position it well for international expansion.
AAL stock is performing well owing to multiple tailwinds, including upbeat passenger volumes and low fuel costs.