Skip to Content
Morningstar
Get 14 Days Free

American Airlines Group Inc AAL

Morningstar Rating
Rating as of

Morningstar’s Analysis

Valuation
Currency in USD

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

American Reports Difficult First Quarter, but the Domestic Reopening Provides a Reason for Optimism

Burkett Huey, CFA Equity Analyst

Analyst Note

| Burkett Huey, CFA |

No-moat-rated American Airlines reported a difficult first quarter, but the dramatic improvement in the U.S. leisure travel market provides good reasons for optimism regarding the recovery in air travel. We’re increasing our fair value estimate to $19 per share from 18.50 as we account for the third round of payroll support in our model. We see shares as fairly valued at current prices.

Read Full Analysis

Company Profile

Business Description

American Airlines is the world’s largest airline by scheduled revenue passenger miles. The firm’s major hubs are Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York, Philadelphia, Phoenix, and Washington, D.C. After completing a major fleet renewal, the company has the youngest fleet of U.S. legacy carriers.

Contact
1 Skyview Drive
Fort Worth, TX, 76155
T +1 817 963-1234
Sector Industrials
Industry Airlines
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 113,200

Related

Investing Specialists
What's the Best Way to Start Investing?
Three arguments against getting started in investing with individual stocks.
Christine Benz
Commentary
Crowd-Sourcing a Short Squeeze
How individual investors are changing the dynamics of a well-known strategy from the institutional investor playbook.
David Sekera
Market Update
Looking Under the Hood at Robinhood
Morningstar’s Global Risk Model reveals how some of the app’s most popular stocks stack up on 11 different measures of equity-related risk.
Amy C. Arnott
Stock Analyst Update
American's Revenue Strategy Risky, but no Other Option
We are reducing our fair value estimate to $14.50 per share from $15, and we remind investors we think that American Airlines' considerable financial leverage widens the dispersion of potential equity values relative to peer airlines.
Burkett Huey
Commentary
The Week Ahead: Coca-Cola, Amazon, and Microsoft to Report Earnings
We're also watching for reports from United, American Airlines, and Southwest. 
Carole Hodorowicz
Stock Strategist
10 Questions That Should Be Asked at Berkshire's Annual Meeting
Berkshire is unlikely to get through the COVID-19 pandemic and subsequent recession unscathed, so questions need to be asked.
Greggory Warren
Stock Analyst Update
American Airlines Conserves Cash to Maintain Operations
No-moat-rated American Airlines reported a difficult first quarter as the COVID-19 pandemic has ground air traffic to a near-halt. We had previously priced in a very difficult 2020 and we are maintaining our $15.70 fair value estimate.
Brian Bernard
Fund Spy
U.S. Stock Funds Say Goodbye Bull Market, Hello Volatility at Quarter-End
Investors grappled with record-breaking volatility in a historic quarter.
Nick Watson
Fund Times
Oakmark Slumps, but Potential Remains
There are plenty of reasons to stay the course with this struggling fund.
Katie Rushkewicz Reichart
Commentary
Are Large Passive Funds Discouraging Competition?
The data do not support a causal story.
Aron Szapiro
Stock Analyst Update
The 737 Max Groundings and North American Airlines
We believe a potential FAA grounding and suspension of deliveries would pose the greatest risk to Southwest.
Danny Goode
Stock Analyst Update
A Few Surprise Purchases for Berkshire
The Oracle of Omaha and his lieutenants initiated positions in JPMorgan Chase and Oracle, among others, last quarter.
Greggory Warren
Stock Analyst Update
We Stand Pat on American After Revised Guidance
We're not changing our fair value estimate after management rolled back capacity expansion for the coming quarter and raised projections for other revenue.
Danny Goode
Stock Strategist Industry Reports
Taking a Fresh Look at the Airlines
Although we've raised our estimates, the carriers still look fairly valued.
Danny Goode
Investing Specialists
Ultimate Stock-Pickers: Top 10 High-Conviction and New-Money Purchases
Several funds take a dive into GE as industrials receive some attention this quarter along with General Motors.
The Morningstar Ultimate Stock-Pickers Team
Premium Article
2 Undervalued Stocks Among Berkshire's Latest Buys
The company added to several positions during the second quarter, and two of those stocks are in buying range today according to our ratings.
Susan Dziubinski
Sustainability Matters
A Closer Look at Our New Tools to Assess Carbon Risk in a Portfolio
We explore how Morningstar's new metrics go beyond carbon footprinting.
Jon Hale
Investing Specialists
Our Ultimate Stock-Pickers’ Top 10 High-Conviction and New-Money Purchases
Passive inflows continue to make for a difficult stock-picking environment.
The Morningstar Ultimate Stock-Pickers Team
Market Update
7 Stocks Top Managers Have Been Buying
Managers from Oakmark, American Century and Diamond Hill picked up airlines, health-care companies, and an industrial distributor in the fourth quarter.
Susan Dziubinski
ETF Specialist
Much Ado About Nothing: The Impact of Diversified Funds on Competition
A new line of research suggests that diversification across stocks in an industry can reduce competition, but that argument is weak.
Alex Bryan