American Airlines Group Inc. operates a network air carrier through its subsidiaries, serving the United States, Latin America, the Atlantic, and the Pacific. It provides scheduled passenger and cargo air transportation via hubs in Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York, Philadelphia, Phoenix, and Washington, D.C., as well as partner gateways in London, Doha, Madrid, Seattle/Tacoma, Sydney, and Tokyo. The company operates a mainline fleet of 1,013 aircraft. Formerly known as AMR Corporation, it changed its name to American Airlines Group Inc. in December 2013; it was founded in 1926 and is headquartered in Fort Worth, Texas.
Falling Fuel Costs and Strong Demand Lift American Airlines
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Jet fuel prices plunge, boosting profit outlook Jet fuel prices have dropped about 40% from April peaks, and UBS estimates a 10-cent drop lifts American's 2027 earnings per share by 16%. Lower fuel costs directly reduce American's largest operating expense after labor, expanding profit margins.
This is the primary driver of AAL's recent stock gains and directly improves profitability.
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Oil prices fall below $70, sparking airline rally WTI crude fell below $70 per barrel for the first time since early March, pushing American Airlines shares up 7% in a single day. Sustained lower oil prices expand operating margins if passenger demand holds steady.
This event triggered the immediate stock price jump and reflects the direct impact of oil on AAL.
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Goldman Sachs raises industry outlook and AAL price target Goldman Sachs lifted its 2026 net income forecasts for airlines by 24-32% and raised American's price target by 50% to $15, citing strong demand and a better competitive environment after Spirit ceased operations. This signals confidence in American's earnings potential.
Analyst upgrades and improved industry fundamentals directly influence investor sentiment and AAL's valuation.
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American invests in Starlink Wi-Fi and sustainable fuel American will equip over 500 planes with SpaceX Starlink high-speed Wi-Fi starting 2027 and entered a three-year sustainable aviation fuel partnership with Google. These moves aim to enhance passenger experience and corporate relationships, potentially supporting demand and brand loyalty.
This is a new strategic initiative that could improve American's competitive position and appeal to customers.
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Fuel Spike Hits AAL, But Strong Demand and Pricing Power Offset
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Fuel Cost Surge from Iran War The U.S.-Iran war has pushed jet fuel prices up sharply, with oil futures near $110 a barrel. American stopped hedging, so every one-cent rise in jet fuel adds about $46 million to annual costs. The stock has fallen 24% since August on this exposure.
This is the dominant force driving AAL's price down this period, directly hitting profits and cash flow.
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Record Revenue and Strong Demand American expects third-quarter revenue growth of 16-19% year over year, driven by broad-based strength in corporate, international, domestic, premium, and coach travel. Premium seating now generates 50% of revenue from 30% of seats, and co-brand cash is projected to exceed $10 billion by 2030.
This shows the underlying business is healthy and growing, providing a counterweight to fuel cost pressures.
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Fuel Cost Pass-Through and Capacity Cuts American warns that fourth-quarter fuel costs could rise by about $1 billion due to a $1 per gallon increase. However, the company has recovered much of this through higher ticket prices and may cut December flying to manage costs. This shows pricing power but also earnings risk.
It highlights management's ability to offset some fuel costs, but the net impact on Q4 earnings remains uncertain.
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Regulatory Headwind on China Routes American opposes adding U.S.-China flights because U.S. carriers must detour around Russian airspace, raising costs. Chinese airlines can fly through Russia, putting U.S. carriers at a disadvantage. This limits potential growth on a key international route.
This regulatory stance could cap international expansion and adds a cost disadvantage, weighing on long-term growth prospects.
Q3 2026
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Fuel Shock Hits American Airlines, Record Revenue Offsets
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Middle East fuel shock crushes profit outlook Middle East tensions and the Iran war pushed jet fuel up 83%, forcing American to cut its profit outlook to roughly breakeven and sending the stock sharply lower. American doesn't hedge fuel, so it's fully exposed.
This is the dominant new force that drove the stock down in Q3.
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Record revenue and strong demand cushion the blow Revenue hit a record $16.7 billion, up 16%, on strong corporate, premium, and international travel. Premium seating now drives half of revenue, and higher fares recovered much of the fuel cost.
This is the main new positive counterweight that partially offset the fuel shock.
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American still lags Delta and United on profitability Even with record revenue, American remains less profitable than Delta and United, a competitive gap that weighs on investor confidence. This lag is a persistent drag on the stock.
It explains why American underperformed peers during the quarter.
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Capacity cuts and China route limits pose risks American is cutting capacity and faces regulatory limits on China routes, which could constrain future growth. These are headwinds that may keep pressure on the stock.
These are new risks that could limit recovery and affect the stock.
News & notes movingAAL
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American Airlines Adds Cash-and-Miles Booking for AAdvantage Members
American Airlines said eligible AAdvantage members will be able to combine cash and miles when buying tickets through its website and mobile app, a feature rolling out in the coming weeks. Members will first select flights priced in cash, then at checkout American will display combinations of cash and AAdvantage miles that can be adjusted with a slider, with the total price updating based on the mix selected. The change gives customers another way to use mileage balances without accumulating enough points to cover an entire award ticket, and American characterized it as part of a broader effort to give AAdvantage members more flexibility in how they use the program. The move comes as competition for lucrative frequent flyers intensifies: United Airlines recently launched a status-match campaign aimed directly at elite members of American and Delta Air Lines, offering qualifying American and Delta customers comparable MileagePlus status for 90 days, extendable through Jan. 31, 2028 by meeting flight and spending requirements ranging from $1,500 in eligible United spending for entry-level Premier Silver status to $7,000 for Premier 1K. American has its own status-match offers for qualifying customers of United, Delta, Southwest Airlines and JetBlue Airways. American has also been expanding AAdvantage benefits, with members reaching 15,000 Loyalty Points able to choose two eligible inflight food and beverage coupons, rewards at various levels now including subscriptions to The New York Times, Games, Cooking and The Athletic, and additional gift choices planned for customers reaching Million Miler milestones.
AAL · Demand · Positive American Airlines rolls out cash-and-miles booking for AAdvantage members, adding flexibility that could boost loyalty and ticket purchases.
UAL · Competition · Neutral United is cited as intensifying competition for frequent flyers with its status-match campaign targeting American and Delta elites.
SkyWest Adds 11 E175s for American Airlines as Costs Squeeze Earnings
SkyWest announced an agreement in July 2026 to purchase and operate 11 new E175 aircraft for American Airlines, with four deliveries scheduled for 2026 and seven for 2027, replacing 11 CRJ700s currently flying for American. The regional carrier also expects eight additional E175 deliveries for United Airlines in the second half of 2026 and 16 E175 deliveries for Delta Air Lines across 2027 and 2028, and anticipates nearly 300 E175 aircraft in its fleet by the end of 2027. SkyWest has separately secured delivery positions for 33 additional E175s from Embraer from 2028 through 2032, plus purchase rights on 50 more. Flying-agreement revenues rose 7.8% year over year to $1.06 billion in second-quarter 2026 as block hours grew 5.4%, but operating expenses surged 9% to $947 million, outpacing the 7% revenue increase, with aircraft fuel expense more than doubling to $60.6 million. Operating income fell 8.4% and net income declined 16.3% from second-quarter 2025, while the company repurchased 833,000 shares for nearly $75 million in the quarter and its board approved a $250 million increase to the existing buyback program.
SKYW · Capital · Negative Operating expenses surged 9% and fuel more than doubled, driving operating income down 8.4% and net income down 16.3%.
SKYW · Demand · Positive SkyWest signed agreements to purchase and operate 11 E175s for American plus additional E175 deliveries for United and Delta, expanding its contracted flying.
AAL · Supply · Neutral SkyWest will operate 11 new E175s for American, replacing CRJ700s, a fleet/supply arrangement but no clear financial impact stated for American.
Alaska Airlines to Expand Seattle International Routes to at Least 15 by 2030
Alaska Airlines is stepping up its international expansion from Seattle, planning to increase its intercontinental destinations from the current level to at least 15 by 2030 and adding Paris and Athens next year. The push will put much of Alaska's international capacity in direct competition with Delta Air Lines in its home market, with 92% of its scheduled intercontinental seats from Seattle through August 2027 on routes also operated nonstop by Delta, according to Cirium data analyzed by Reuters. Alaska entered the push with a lower cost base than larger rivals, reporting adjusted nonfuel cost of 11.85 cents per seat mile in the first half versus 14.58 cents for Delta, though its operating revenue per seat mile was 16.06 cents against Delta's 21.55 cents. The carrier is adding Boeing 787s, premium cabins and lounges while seeking to increase higher-margin revenue, and plans to join American Airlines' revenue-sharing ventures across the Atlantic and Pacific, pending regulatory approvals. Alaska expects revenue from outside the main cabin to reach nearly 60% by 2030, up from 53% this year.
ALK · Demand · Positive Alaska is expanding Seattle international routes to at least 15 destinations by 2030, adding Paris and Athens next year.
DAL · Competition · Negative 92% of Alaska's scheduled intercontinental seats from Seattle through August 2027 are on routes also operated nonstop by Delta, putting Alaska in direct competition with Delta in its home market.
AAL · Demand · Positive Alaska plans to join American Airlines' revenue-sharing ventures across the Atlantic and Pacific, pending regulatory approvals.
BA · Demand · Positive Alaska is adding Boeing 787s to support its international expansion.
Musk Mocks Delta Wi-Fi After Airline Picks Amazon Leo Over Starlink
Elon Musk mocked Delta Air Lines' in-flight internet on Tuesday, joking that the carrier's connectivity could serve as an artificial-intelligence containment system, after warning Delta could lose customers for choosing Amazon's Leo over Starlink. "Best way to sandbox an AI is to put it on a Delta flight – it will have no chance of accessing the Internet!" the SpaceX CEO wrote on X. The jab followed his public prediction that Delta CEO Ed Bastian would "lose his job" over reported remarks suggesting the airline rejected Starlink partly because it did not want to work with Musk, comments Delta has not confirmed. Delta chose Amazon Leo instead and will begin installing the service on 500 aircraft in 2028, integrating it with Delta Sync; Bastian called it "the fastest and most cost-effective technology available." Delta says its existing free Delta Sync Wi-Fi, presented by T-Mobile, reaches more than 1,200 aircraft and has logged more than 160 million customer sessions since launch, while American Airlines plans to install Starlink on more than 500 narrowbody aircraft beginning in 2027.
Space Economy › Satellite Connectivity & Direct-to-Device Competition
DAL · Competition · Neutral Delta chose Amazon Leo over Starlink and faces Musk's public mockery and prediction its CEO will lose his job, but no clear financial impact stated.
AMZN · Demand · Positive Delta selected Amazon Leo for in-flight Wi-Fi on 500 aircraft starting 2028, a concrete customer win for Amazon's satellite internet service.
AAL · Competition · Neutral Mentioned only as another airline planning Starlink installation on 500 narrowbodies from 2027, no direct development for American.
American Airlines Says 30% of Seats Generate Half of Revenue
American Airlines Group Inc. told investors that only 30% of its seats now generate half of its total revenue, a figure that underscores how central premium cabins have become to the carrier's economics. CEO Robert Isom said the airline plans to grow its premium seating by roughly 50% before the decade is out, and American is rolling out a 70-suite business class on its largest aircraft, the Boeing 777-300ER, alongside reconfigurations of its 787-8 and 777-200 fleets. The airline is betting that premium demand keeps growing faster than the rest of the cabin, though concentrating half of all revenue in less than a third of seats leaves less room for error if high-end travel slows. Competitors including Delta, United, JetBlue and lower-cost carriers are adding similar premium products, raising the risk that industry capacity grows faster than demand and erodes the fare premium that makes the cabin changes attractive. Hedge fund sentiment on American held steady at 42 holders in both the first and second quarters of 2026, with position value rising to $1.68 billion from $747.9 million, while Delta's holders climbed to 75 from 68.
AAL · Demand · Positive American says premium cabins now drive half of total revenue and plans ~50% more premium seats plus a 70-suite 777-300ER business class, betting premium demand keeps outpacing the rest of the cabin.
DAL · Competition · Neutral Delta is cited as a competitor adding similar premium products, raising industry overcapacity risk, and its hedge-fund holder count rose to 75 from 68.
US airlines oppose more China flights, fear disadvantage on Russian routes
US airlines have come out against the idea of increasing passenger flights between the United States and China, after President Xi Jinping proposed on Thursday, September 24, in Washington that the two countries add direct flights to promote travel and trade. Chris Sununu, president of the Airlines for America trade group, known as A4A, which represents major US carriers including American Airlines, United Airlines and Delta Air Lines, said Chinese airlines can still fly eight flights through Russian airspace, while US airlines must take detours, driving up their costs. He said the group has urged officials in the Trump administration not to make concessions, because routing around Russia is no small matter but imposes enormous costs on airlines. Currently, US and Chinese airlines can each operate about 50 round-trip flights a week between the two countries. A4A had earlier opposed a request by Air China to add scheduled flights, arguing that US carriers can barely open routes from the US East Coast to China because they cannot pass through Russian airspace. The restrictions came after the United States barred Russian flights from its airspace in March 2022 following Russia's invasion of Ukraine, and Russia retaliated by banning US airlines from its airspace. Then in 2023, the United States and China agreed that additional Chinese flights would not use routes through Russia. However, the proposal had previously been opposed by other US agencies and was shelved ahead of trade talks with China.
AAL · Regulation · Negative A4A, representing American Airlines, opposes adding US-China flights because US carriers must detour around Russian airspace, raising costs and putting them at a disadvantage.
DAL · Regulation · Negative Delta, as an A4A member, opposes more China flights since US carriers cannot use Russian airspace and face higher costs versus Chinese rivals.
601111.CG · Regulation · Positive Air China's request to add scheduled flights was opposed by A4A; the proposal to add US-China flights would benefit the Chinese carrier that can still fly through Russian airspace.
STARLUX Airlines and American Airlines Launch Codeshare Partnership Across 20 U.S. Destinations
STARLUX Airlines and American Airlines today launched a codeshare partnership, with tickets now available for flights connecting STARLUX's transpacific service with American Airlines' flights to 20 major U.S. destinations. The partnership lets travelers book a single itinerary combining American Airlines' eligible connecting flights with STARLUX's service to Taipei and onward to destinations across Asia. The initial codeshare covers 20 cities out of the more than 250 destinations American Airlines serves across North America, with more destinations expected to be added as the partnership expands. The codeshare builds on the airlines' interline agreement established in 2025, and the two carriers are also preparing a reciprocal frequent-flyer partnership allowing members of both airlines to earn and redeem miles on eligible codeshare flights. STARLUX Airlines CEO Glenn Chai called the codeshare an important milestone for the airline, while American's Senior Vice President of Alliances, Anmol Bhargava, said the collaboration strengthens American's global network and unlocks new competitive itineraries.
2646.TW · Demand · Positive STARLUX launched a codeshare with American Airlines connecting its Taipei/Asia service to 20 U.S. destinations, expanding its customer base.
AAL · Demand · Positive American Airlines launched a codeshare with STARLUX adding 20 U.S. destinations to its network, expanding its customer reach and itineraries.
Iran Offers Conditional Hormuz Reopening; Airlines Rise, Cruise Stocks Fall
A senior Iranian official told a Japanese news agency that Tehran could reopen the Strait of Hormuz within seven days, provided Washington begins ending its blockade of Iranian ports and its military operations, a claim resting on a single unnamed source that American networks said they could not independently verify. Crude drifted lower on the headline, and the airlines finished modestly higher: United Airlines closed at $115.21, up 0.72%, Delta Air Lines added 1.73% to $83.93, American Airlines gained 0.29% to $13.61, and the U.S. Global Jets ETF rose 0.34% to $29.11. Cruise lines moved the other way, with Royal Caribbean falling 6.17% to $234.81 and Carnival slipping 0.13% to $22.28, a split the market read as a consumer-risk story rather than a fuel story. WTI closed at $107.02 on September 15 after trading in the mid $80s in late August, and United management said the recent fuel spike alone was worth about $1.12 of EPS. The deciding variable is tanker transit counts through the strait over the next week; a similar de-escalation headline in June briefly crashed Brent and rallied airlines before the deal collapsed entirely.
UAL · Geopolitics · Positive United Airlines closed up 0.72% as the possible Hormuz reopening eased fuel costs; management noted the recent fuel spike was worth about $1.12 of EPS.
AAL · Geopolitics · Positive American Airlines gained 0.29% as a possible Strait of Hormuz reopening eased fuel-supply fears for airlines.
CCL · Geopolitics · Negative Carnival slipped 0.13% as cruise lines fell on the Hormuz headline, read as a consumer-risk story.
DAL · Geopolitics · Positive Delta Air Lines added 1.73% as the potential Hormuz reopening eased fuel-cost concerns for airlines.
RCL · Geopolitics · Negative Royal Caribbean fell 6.17% as cruise stocks dropped on the Hormuz de-escalation headline, seen as a consumer-risk story.
SABA Members Sign Long-Term SAF Deals Backing Infinium's Project Atlas
The Sustainable Aviation Buyers Alliance announced commitments from its members to purchase sustainable aviation fuel certificates tied to Infinium Energy's Project Atlas, a Texas-based eSAF facility expected to produce approximately 100,000 metric tons of SAF annually. AVEVA, Bain & Company, Google, McKinsey and others backed the procurement, which SABA said is the first-ever application of its approach to drive new production of high-integrity SAF by focusing on projects moving toward final investment decision. Infinium submitted its winning proposal jointly with American Airlines, which will take physical delivery of the fuel and oversee logistics, and contracted volumes are expected to support greenhouse gas abatement of over 212,000 mtCO2e, equivalent to the emissions of over 3,500 JFK to LAX commercial flights. To date, SABA has aggregated $500 million in demand for SAFc from over 35 member companies, and with the binding multi-year offtake agreements in hand, Infinium said it is well positioned to advance to final investment decision and secure financing to build the facility. Infinium also plans to sell RFNBO compliant eSAF from the facility into European regulatory markets.
Infinium · Demand · Positive SABA members signed binding multi-year offtake agreements for SAF certificates tied to Infinium's Project Atlas, supporting its path to final investment decision.
AAL · Demand · Positive American Airlines will take physical delivery of the SAF from Infinium's Project Atlas and oversee logistics, securing contracted fuel volumes.
American, United and Southwest Cut Flights as Q4 Fuel Costs Jump $1B
American Airlines, United Airlines and Southwest Airlines are scaling back or reconsidering planned flight schedules as jet fuel prices surge, a move that could leave travelers with fewer flight options and potentially higher fares heading into the holiday season. For American, the latest jump in fuel prices alone is expected to add roughly $1 billion to its fourth-quarter fuel costs compared with the assumptions it made in July, after fourth-quarter fuel prices rose by roughly $1 per gallon from that July level, according to CFO Devon May, who noted that every one-cent change in fuel prices affects quarterly costs by about $10 million. United has already said some flights scheduled for December will no longer operate and warned of additional adjustments in the first quarter of 2027 and beyond if fuel prices remain elevated, while Southwest has roughly halved its planned 2026 capacity growth from an original target of about 2% to 3%, with its CFO saying further reductions could follow. The International Air Transport Association reported the global average jet fuel price rose 7.4% to $194.90/bbl from the week before, and its June outlook noted that airlines could rationalize capacity by trimming less-profitable routes or reducing flight frequencies. Executives from all three carriers said demand has remained resilient despite higher fares, and that combination of strong demand and less available capacity can give airlines more ability to maintain or increase fares.
Redburn upgrades Southwest to Neutral, keeps Buy on Delta and United
Redburn upgraded Southwest Airlines to Neutral from Sell while reiterating Buy ratings on Delta and United, citing a strong sector backdrop. Analyst James Goodall said results through the first half of 2026 confirmed strong leisure and premium demand and acceptance of higher domestic fares, and he expects lingering capacity constraints, softer low-cost carrier competition and premium strength to drive continued unit revenue growth into next year. Redburn lifted its jet fuel cost forecasts materially above consensus, seeing downside to 2026 earnings across the sector, though it argued that is largely priced in after recent share price falls. Its 2027 forecasts are ahead of consensus for Delta and United, with target prices of $105 and $150 respectively, while Southwest carries a $40 target and American keeps a Neutral rating and a $13.50 target on greater fuel-price sensitivity.
Oil's 40% Surge Since August Pressures Airline and Cruise Fuel Costs
A 40% spike in oil futures since the beginning of August has put fuel costs back in focus for the airline and cruise industries, with oil futures challenging $110 per barrel. Within the cruise industry, Carnival is the most vulnerable because it buys fuel at current spot-market prices rather than using hedges, and an industry study finds a 10% increase in fuel costs per metric ton can lower Carnival's annual net income by as much as $140M. Royal Caribbean employs the most efficient hedging strategy, with as much as 60% of its fuel needs locked in at below-market prices, so the same 10% increase costs it roughly $50M annually in net income, while Viking Holdings is the least exposed on a fuel consumption basis thanks to its smaller fleet and higher-income, relatively inelastic customer base. In the airline industry, fuel hedges have cushioned some larger European carriers, but legacy U.S. carriers have abandoned the strategy altogether; Delta Air Lines has its own oil refinery in Pennsylvania, while American Airlines and United Airlines stopped hedging to capitalize on lower fuel prices prior to February 2026, leaving them vulnerable. According to Bloomberg research, every one-cent increase in the price of a gallon of jet fuel raises American's annual operating expenses by about $46M and United's by $40M annually, and since the start of August the oil spike has translated into an 18% drop in United's share price, 24% for American, and 16% for Delta.
AAL · Supply · Negative American stopped hedging and is vulnerable to the oil spike, with each one-cent rise in jet fuel adding ~$46M to annual operating expenses.
CCL · Supply · Negative Carnival buys fuel at spot prices with no hedges, so a 10% fuel cost increase can cut annual net income by up to $140M.
DAL · Supply · Negative Delta faces higher fuel costs from the 40% oil surge, though its Pennsylvania refinery cushions the blow.
RCL · Supply · Negative Royal Caribbean faces higher fuel costs from the oil spike, though its 60% below-market hedges limit the hit to ~$50M per 10% increase.
UAL · Supply · Negative United abandoned hedging and is exposed to the oil spike, with each one-cent rise in jet fuel adding ~$40M to annual operating expenses.
VIK · Supply · Negative Oil's 40% surge raises fuel costs, though Viking is the least exposed on a fuel-consumption basis due to its smaller fleet and inelastic customer base.
Boeing and American Airlines Complete First 737 MAX Landing Gear Exchange
Boeing and American Airlines announced the successful completion of the first landing gear exchange for a 737 MAX, extending Boeing's longstanding Landing Gear Exchange Program to the MAX platform. For the completed exchange, Boeing supplied an overhauled and certified main and nose landing gear assembly with an installation kit, excluding wheels, tires and brakes, and the swap validated the end-to-end process from technical overhaul and paperwork through delivery. William Ampofo, senior vice president of Parts & Distribution and Supply Chain at Boeing Global Services, said the milestone reinforces that the program delivers predictable, safe and cost-effective outcomes and gives operators another proven tool to shorten downtime and manage costs. Boeing is also increasing global overhaul capacity and coordinating with certified MRO partners to expand geographic availability and shorten lead times, with near-term priorities including enlarging 737 MAX-capable exchange inventory and adding forward-exchange slots close to customer operations. The program lets airlines avoid lengthy in-place overhauls and extended groundings by reserving forward-exchange slots instead of holding high-cost spare inventories, with Boeing managing technical overhaul, service bulletin incorporation, certification and supplier coordination.
BA · Demand · Positive Boeing extended its Landing Gear Exchange Program to the 737 MAX and is expanding overhaul capacity and exchange inventory to serve operators.
AAL · Supply · Positive American Airlines completed the first 737 MAX landing gear exchange, cutting downtime and spare-inventory costs via Boeing's program.
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American Airlines Adds Seven International Routes Using Airbus A321XLR
American Airlines Group Inc. announced seven new international routes for its summer 2027 schedule, most flown on its Airbus A321XLR, as it seeks to expand into higher-margin markets. New destinations include Philadelphia to Porto and Vienna, JFK to Amsterdam and Nice, a returning Reykjavik route, and Charlotte-Barcelona and Chicago-Tokyo Narita on widebody jets. Brian Znotins, American's SVP of network and schedule planning, said the XLR "really opens up the menu for all these destinations that are just too small for a widebody." The announcement came the same week rival United Airlines unveiled its own 2027 international additions. American's flying is split roughly 80% domestic and 20% international.
Ryanair warns airfares will rise if fuel prices stay high
Ryanair, one of Europe's largest low-cost airlines, warns that airfares will keep rising if jet fuel prices remain high into 2027, and that some carriers may struggle to survive. The warning follows an escalation in the U.S.-Iran war, which has heightened fears of supply disruptions in the Strait of Hormuz, a key route for about one-fifth of the world's seaborne jet fuel trade. Jet fuel prices have neared $140 a barrel, and the global average jet fuel price is 74.2% higher than last year's average, according to IATA. Ryanair, which has hedged about 80% of its fuel costs at $67 a barrel, is cutting winter traffic targets by about 2 million passengers to reduce exposure to unhedged fuel. Unhedged U.S. carriers like American, United, and Delta each face about $400 million in additional monthly fuel costs, according to DWU Consulting, and may raise ticket prices or cut routes. Travelers are advised to book sooner rather than later, consider hedged airlines for international trips, and avoid basic economy tickets to maintain flexibility.
American Airlines to Increase Premium Seats on Long-Haul Routes
American Airlines aims to improve profitability by increasing the number of premium seats on its Boeing 777-300ER aircraft operating on long-haul routes. The first retrofitted aircraft began commercial service on the 9th of this month on a flight from New York to Buenos Aires, with all 20 aircraft expected to be completed by 2027. After the retrofit, premium seats will increase from the current 116 to 144, raising their share of total seats from 38% to approximately 44%. The breakdown includes 70 seats in the door-equipped business class "Flagship Suite," 44 in premium economy, and 30 in the extra-legroom "Main Cabin Extra." Meanwhile, the current first class "Flagship First" with 8 seats will be eliminated and will no longer be sold on flights from November 19 onward. American announced the phased elimination of international first class in 2022, further advancing its strategy to increase the highly demanded business class. Premium seat passengers accounted for about 30% of all seats in the second quarter of 2026 but contributed roughly half of ticket revenue. American also plans to raise the premium seat share on single-aisle aircraft from the current approximately 25% to about 40% over the next few years. The retrofitted aircraft will be deployed on routes to London, Tokyo, São Paulo, Buenos Aires, Sydney, and others, and will feature refreshed in-flight entertainment and complimentary high-speed Wi-Fi for loyalty members.
American Airlines to Add Seatback Screens to Close Profit Gap with Delta
American Airlines Group Inc. announced on August 18, 2026, that it will add seatback screens to more than 800 narrowbody jets and boost premium seating to about 40% of narrowbody capacity from roughly 25%, reversing a nearly decade-old decision to strip screens from its planes. The move is a direct attempt to close a profit gap with rivals: American reported second-quarter profit of just $71 million, compared with $805 million at United and $1.6 billion at Delta Air Lines Inc. The airline also reported a record 16.3% jump in second-quarter revenue, with premium unit revenue up 13.4% and managed corporate revenue up 26%, but fuel costs rose $2.2 billion, or 83%, wiping out much of the gain. CEO Robert Isom called the gap "meaningful" in a memo to staff while reshuffling senior leadership. New screens won't start going in until 2028, with full completion not expected until the early 2030s. Delta, which never removed its screens, affirmed full-year earnings guidance of $6.50 to $7.50 a share even after absorbing its highest-ever quarterly fuel bill.
American Airlines Down 30.5% Over Five Years, Merger Rejected
American Airlines (NASDAQ:AAL) is down 30.5% over five years, while Delta and United have each gained over 100%, leaving American's market cap at roughly $9.2 billion versus Delta's $54.6 billion. Despite absorbing the same fuel shock, Delta delivered a 9% operating margin while American's collapsed to under 3%, with full-year 2026 adjusted EPS guidance reset to a loss of $0.65 to a profit of $0.65. American rejected United's 2026 merger bid on antitrust grounds, leaving CEO Robert Isom to close the unit revenue gap through fleet upgrades and premium cabin expansion alone. The company's debt has been cut from about $54 billion at the pandemic peak to roughly $35 billion, though shareholder equity remains negative at $3.972 billion.
Delta Air Lines and United Airlines are restoring more service to Israel, signaling growing confidence in a market that U.S. carriers have repeatedly pulled back from due to security concerns. Delta will restart daily New York-to-Tel Aviv flights on September 6, while United is adding San Francisco service next spring. Delta's restart is measured: its Atlanta-Tel Aviv service remains suspended until December 18, and Boston service until further notice. United plans three weekly flights between San Francisco and Tel Aviv beginning March 28, adding to its existing service from Newark, Chicago, and Washington Dulles. American Airlines, in contrast, has its Israel flights suspended through March 27, 2027, leaving Delta and United with less direct competition. For investors, Israel itself is unlikely to materially change either airline's overall earnings, but restoring service matters because long-haul international and premium travel are important revenue sources, and limited capacity can support pricing if demand remains resilient.
United Airlines CEO Weighs JFK Growth and AI Plans
United Airlines Holdings CEO Scott Kirby is considering further growth at New York's John F. Kennedy International Airport, including seeking additional slots from airlines not generating attractive returns there. The carrier is expected to resume JFK service as early as next year through a partnership involving JetBlue Airways. United also plans to broaden its international network, already the largest among U.S. carriers, and is assessing how artificial intelligence could reshape parts of the airline industry. Kirby has previously discussed potential combinations involving United, Delta Air Lines and American Airlines Group, though those possibilities have faced resistance.
American Airlines to boost premium seats to 40% and add seat-back screens
American Airlines is retrofitting its Airbus A319s and A320s with extra first-class seats and will take delivery of Boeing 737 MAX 10s fitted with 24 first-class seats, increasing its premium seat share from 25% to 40%. The carrier is also returning seat-back screens to its aircraft, aligning with rivals Delta and United and creating additional ad revenue opportunities. CEO Robert Isom said premium revenue continues to outpace non-premium, with passenger unit revenue in the premium segment up 13.4% in the second quarter versus 8.8% in the main cabin. COO Nathaniel Pieper added that progress across customer experience, network, premium revenue, and loyalty gives confidence in long-term value creation. American Airlines shares are down for a third straight day with a cumulative loss of 6%.
American Airlines Advances Sustainable Aviation Fuel Adoption
American Airlines has successfully used Infinium's eSAF on a commercial passenger flight, marking a significant step in the commercial adoption of next-generation sustainable aviation fuel. The fuel, produced from waste carbon dioxide and renewable electricity, can be blended with conventional jet fuel and used within existing aircraft and airport infrastructure without modifications, and can reduce lifecycle greenhouse gas emissions by more than 90% versus conventional petroleum-based jet fuel. Infinium's Project Roadrunner is expected to begin production and deliveries in 2027, providing a potential source of commercial-scale eSAF for American Airlines under its offtake agreement. Sustainable aviation fuel currently accounts for less than 1% of global jet fuel consumption, and scaling production remains a key challenge for the aviation industry. American Airlines shares have gained 14.4% over the past year, compared with the Transportation-Airline industry's 9.9% growth.
Infinium · Demand · Positive Infinium's eSAF was used by American Airlines, and Project Roadrunner is expected to begin production in 2027, supporting its commercial-scale adoption.
AAL · Demand · Positive American Airlines successfully used Infinium's eSAF on a commercial flight, advancing its sustainable fuel adoption and offtake agreement.
American Airlines Posts Record Revenue but Fuel Costs Surge 83%
American Airlines reported record second-quarter revenue of $16.7 billion, up 16.3% year over year, driven by broad-based demand across premium, corporate, domestic, and international travel. However, fuel expense surged 83% to $4.88 billion, largely offsetting those gains and highlighting the key risk to profitability. Management expects an additional $1.7 billion in year-over-year fuel expense in the third quarter and guided to an adjusted loss per diluted share of $0.70 to $0.10 for the period, while full-year guidance ranges from a loss of $0.65 to a profit of $0.65 per share. The airline was able to recover roughly half of the fuel cost increase through stronger pricing, but the outlook remains uncertain as fuel volatility persists.
United Airlines CEO's Merger Bids Rejected by Delta and American
United Airlines CEO Scott Kirby's merger approaches to Delta Air Lines and American Airlines have been rejected. Delta CEO Ed Bastian conducted preliminary due diligence but both sides moved on, while American CEO Robert Isom publicly called the bid a non-starter and anti-competitive. United shares closed at $128.39 on August 3, up 6.5% on the week and 51.8% over the past year, as the carrier focuses on organic growth through Starlink, new A321XLR jets, and joint ventures with ANA and Lufthansa. United posted second-quarter 2026 adjusted earnings per share of $1.99 on $17.67 billion in revenue, a 16% year-over-year increase, and raised full-year adjusted EPS guidance to $9.00 to $11.00.
UAL · Capital · Positive United raised full-year adjusted EPS guidance to $9.00-$11.00 and reported strong Q2 earnings, driving positive sentiment.
AAL · Competition · Neutral American CEO publicly rejected United's merger bid as non-starter and anti-competitive, but no direct impact on American's operations.
DAL · Competition · Neutral Delta conducted preliminary due diligence on United's merger approach but moved on; no direct impact on Delta's business.
American Airlines and Citi refresh co-branded card with up to $2,300 in value
American Airlines, Citi and Mastercard announced updates to the Citi / AAdvantage Executive World Legend Mastercard, introducing new and enhanced premium travel and lifestyle benefits that deliver up to $2,300 in value. The refreshed card offers richer statement credits, including up to $500 back on eligible American Airlines Vacations purchases, up to $100 back on inflight and eligible Admirals Club purchases, and up to $180 in Lyft credits annually. Earning rates increase to 12X AAdvantage miles on eligible AAdvantage Hotels and AAdvantage Cars bookings, and cardmembers can now earn up to 40,000 bonus Loyalty Points toward AAdvantage status through new milestones at 165,000 and 240,000 Loyalty Points. Additional benefits include Omni Hotels & Resorts Champion Status, a complimentary Omni Free Night Reward, and Avis President's Club Status. The card remains the only one that includes Admirals Club membership, valued at up to $1,400 annually, providing unlimited lounge visits for the primary cardmember and up to two guests. The enhanced card will be available for new cardmembers starting August 23, 2026, with an annual fee of $695.
Travel Stocks Surge as US-Iran Tensions Ease and Oil Prices Tumble
Shares of major airlines and cruise operators soared after a reported pause in US-Iran military hostilities sent global oil prices tumbling. Brent crude futures plunged over 6% to around $90 a barrel, sharply reducing fuel costs that are among the largest variable expenses for travel companies. Royal Caribbean rose 1.4%, Carnival gained 2.1%, Norwegian Cruise Line jumped 2.8%, and American Airlines and Delta each advanced 1.7%. The de-escalation in Middle East tensions triggered a risk-on rotation into fuel-sensitive, high-beta travel stocks as investors priced in lower operational costs and easing bond yields.
SkyWest Expands Buyback Authorization to $750 Million After Softer Earnings
SkyWest reported second-quarter 2026 revenue of US$1,102.75 million and net income of US$100.7 million, with earnings per share lower than a year ago. The company completed repurchases of 7,291,719 shares for US$437.22 million and expanded its stock repurchase authorization by an additional US$250 million, bringing the total authorization to US$750 million. SkyWest also plans to operate 11 new E175 aircraft for American Airlines, supporting fleet modernization and contract flying. Rising maintenance and labor costs remain a key risk to the investment narrative.
SKYW · Capital · Positive Expanded buyback authorization to $750 million and completed $437 million in repurchases, signaling capital return to shareholders.
SKYW · Supply · Negative Rising maintenance and labor costs remain a key risk to the investment narrative.
AAL · Demand · Positive SkyWest plans to operate 11 new E175 aircraft for American Airlines, indicating increased contract flying demand.
U.S. Airlines Slash Earnings Outlooks as Jet Fuel Costs Soar on Middle East Conflict
U.S. airlines are slashing earnings forecasts after renewed Middle East hostilities pushed jet fuel costs sharply higher. Southwest Airlines reported a $900 million year-over-year jump in second-quarter fuel expenses, a $1.17 headwind to adjusted earnings per share, and cut its full-year 2026 adjusted EPS guidance to a range of $3.25 to $4.25 from at least $4.00. American Airlines saw fuel expense surge over $2.2 billion, or 83%, and now expects full-year adjusted diluted EPS between a loss of $0.65 and earnings of $0.65, with a third-quarter loss of $0.10 to $0.70 per share. United Airlines anticipates nearly $6 billion in added fuel expense for full-year 2026 and reported a $2.3 billion, or 84%, jump in second-quarter fuel costs. The spike follows the collapse of a U.S.-Iran memorandum of understanding and a ceasefire, which reignited crude and fuel price rallies, while record U.S. fuel exports and tight global markets add further pressure.
United reportedly approached Delta Air Lines about a potential merger
United Airlines reportedly approached Delta Air Lines last year about a potential merger that would have combined two of the largest U.S. carriers. United CEO Scott Kirby contacted Delta CEO Ed Bastian to pitch the tie-up, and Delta leadership discussed the proposal as part of preliminary due diligence, but the talks did not advance. A United spokesperson said the airline had nothing to share, while Delta declined to comment. Kirby also explored a possible merger with American Airlines earlier this year, but American rejected it, and Kirby later downplayed the likelihood of a major consolidation deal.
UAL · Capital · Negative United's merger approaches to Delta and American were rejected or did not advance, indicating failed strategic initiative.
DAL · Capital · Neutral Delta was approached by United about a merger but talks did not advance; no definitive outcome or impact.
AAL · Competition · Neutral United also approached American about a merger, but American rejected it; the article does not indicate any direct impact on American.
American Airlines Stock Plunges After Fuel Cost Warning
American Airlines Group shares tumbled after the carrier warned that surging jet fuel prices are eroding profitability, overshadowing a stronger-than-expected second-quarter earnings report. The airline reported record quarterly revenue of $16.7 billion, up 16.3% year-over-year, and adjusted earnings of $0.15 per share, beating Wall Street estimates, but net income fell sharply to $71 million from $599 million a year earlier as fuel expenses jumped more than $2.2 billion, or 83% year-over-year. Management now expects full-year adjusted earnings ranging from a loss of $0.65 per share to a profit of $0.65, a significant reduction from its prior outlook, and third-quarter adjusted EPS between a loss of $0.70 and $0.10. The stock fell 8.4% on July 23, extending its year-to-date decline to 5.6%, though it remains up 26.3% over the past 52 weeks. Analysts have a consensus Moderate Buy rating on the stock, with an average price target of $19.77, but Citigroup lowered its target to $19 from $22 and Melius Research downgraded the shares to Hold from Buy.
Iran War Drives Lockheed Martin Higher and American Airlines Lower on Same-Day Earnings
Lockheed Martin and American Airlines reported earnings the same day this week, revealing how the ongoing war involving Iran is creating clear winners and losers. Lockheed Martin raised its full-year sales guidance to a range of $79.75 billion to $81.75 billion and profit guidance to $29.95 to $30.65 a share, both beating Wall Street expectations, while its missile sales jumped about 20% to $4.1 billion and its order backlog hit a record $230.4 billion. American Airlines cut its 2026 earnings outlook to a range of a loss of 65 cents to a profit of 65 cents a share, worse than its prior forecast, as jet fuel costs surged 83% in the second quarter and fare increases covered only about half of the added fuel expense. Lockheed Martin's stock jumped as much as 10% on the news, while American Airlines shares fell about 8%. Hedge fund data showed that 83 funds held Lockheed Martin at the end of the first quarter of 2026, up from 59 the prior quarter, while American Airlines was held by just 42 funds, down from 49.
Defense & Geopolitical Fragmentation › Defense Primes — United States ▲Demand
AAL · Supply · Negative Jet fuel costs surged 83% due to Iran war, and fare increases covered only half the added expense, leading to lowered earnings outlook.
LMT · Demand · Positive Iran war drives missile sales up 20% to $4.1 billion and record backlog of $230.4 billion, raising full-year guidance.
American Airlines Reports Record Quarterly Revenue with 16% Growth
American Airlines Group Inc achieved record quarterly revenue with a year-over-year increase of more than 16%, driven by strength across all geographic segments and premium services. Fuel expenses rose by over $2.2 billion, or 83%, year-over-year, contributing to a full-year adjusted earnings breakeven outlook at the midpoint of guidance. The company ended the second quarter with over $11 billion in available liquidity, while domestic unit revenue climbed nearly 11%, Atlantic unit revenue rose approximately 9%, Pacific unit revenue increased 15%, and Latin America unit revenue was up approximately 7%. Premium unit revenue grew more than 13% year-over-year, and managed corporate revenue surged 26%, with the AAdvantage loyalty program seeing enrollments jump more than 30%. For the third quarter, American Airlines expects revenue growth of 16% to 19%, capacity up 3% to 5%, and CASM-ex up 2.5% to 4.5%, with fuel priced around $3.75 per gallon.
US Initial Jobless Claims Drop to 187,000, a Level Not Seen Since the Late 1960s
Initial jobless claims fell to 187,000 for the latest week, well below the expected 212,000 and the prior week's slightly upwardly revised 209,000, reaching lows not seen since the late 1960s. Continuing claims came in at 1.796 million, below the downwardly revised 1.798 million from the previous week and the lowest print since the week of May 30th. The data arrived amid a sharp pre-market selloff driven by rising Middle East tensions, with the Dow down 560 points, the S&P 500 off 83 points, and the Nasdaq dropping 450 points. WTI oil prices rose over 4% to above $91 per barrel and Brent crude gained over 5% to nearly $100 per barrel following hostilities in the Strait of Hormuz involving Yemeni Houthis and US air strikes in Iran. In earnings, American Airlines posted a 400% positive earnings surprise to $0.15 per share on revenues of $16.74 billion, T-Mobile US beat by 25.7% to $3.13 per share on revenues of $22.79 billion, Blackstone surpassed estimates by 14.3% to $1.52 per share on revenues of $3.8 billion, and Lockheed Martin shares rose 5.5% after beating earnings estimates by nearly 10% to $7.94 per share on revenues of $20.06 billion.
AAL · Capital · Positive American Airlines posted a 400% positive earnings surprise to $0.15 per share on revenues of $16.74 billion.
BX · Capital · Positive Blackstone surpassed estimates by 14.3% to $1.52 per share on revenues of $3.8 billion.
LMT · Capital · Positive Lockheed Martin shares rose 5.5% after beating earnings estimates by nearly 10% to $7.94 per share on revenues of $20.06 billion.
TMUS · Capital · Positive T-Mobile US beat by 25.7% to $3.13 per share on revenues of $22.79 billion.
Tesla, Alphabet, and American Airlines lead Thursday's biggest stock declines
Tesla, Alphabet, and American Airlines were among the biggest stock losers on Thursday as investors reacted to a wave of technology earnings and escalating geopolitical tensions. Tesla shares fell 12% after the EV maker missed Q2 earnings expectations, with EPS of $0.33, an operating margin of 1.4%, and negative free cash flow of $1.1 billion overshadowing record quarterly revenue growth of 26% year-over-year. Alphabet dropped 6% as surging AI spending and higher capital expenditure guidance outweighed a strong Q2 earnings beat, with revenue climbing 25% to $119.8 billion but adjusted EPS missing estimates and free cash flow turning negative by $5.9 billion. American Airlines declined 7% despite a Q2 earnings beat after cutting its full-year profit outlook and issuing weaker-than-expected Q3 guidance, citing an 83% surge in fuel costs that is expected to drive a quarterly loss of $0.10 to $0.70 per share. On the gaining side, Hyliion surged 14% after securing a $41.7 million U.S. Navy contract, United Rentals jumped 13% on record revenue of $4.41 billion and raised guidance, Lockheed Martin rallied 11% after beating estimates and lifting its outlook on $65 billion in new orders, RTX gained 8% on strong demand and a record backlog of $289 billion, and ServiceNow rose 5% after beating estimates and highlighting ninefold growth in AI agent deployments.
Wall Street Favors Lockheed Martin Over American Airlines Ahead of Thursday Earnings
Lockheed Martin is the clear favorite over American Airlines heading into their simultaneous second-quarter earnings reports on Thursday, July 23, 2026, according to a 24/7 Wall St. analysis. Lockheed Martin's diluted EPS guidance of $29.35 to $30.25 for fiscal 2026, a record $194 billion backlog, and 23 consecutive years of dividend increases contrast sharply with American Airlines' adjusted EPS guidance ranging from a loss of $0.40 to a profit of $1.10, $34.7 billion in total debt, and negative equity. Analyst consensus rates Lockheed Martin a Hold with a $606.68 price target, implying significant upside from its $507.09 close, while American Airlines lacks a clean forward earnings multiple and carries bearish social sentiment. Prediction market data gives Lockheed Martin a 57% chance of beating Q2 estimates and a 97.1% probability that its backlog stays above $170 billion. The analysis concludes that Lockheed Martin suits retirement-focused portfolios, whereas American Airlines remains a speculative bet tied to fuel costs and the airline cycle.
American Airlines to report earnings Thursday with revenue expected to grow 16.1%
American Airlines will report its earnings this Thursday before market open. Analysts expect revenue to grow 16.1% year on year, a significant improvement from flat revenue in the same quarter last year. The company beat revenue expectations last quarter, reporting $13.91 billion, up 10.8% year on year, with EPS guidance also exceeding estimates. Peers Delta and Carnival have already reported, with Delta beating expectations with 18.7% revenue growth and Carnival meeting estimates with 5.3% growth. American Airlines shares are down 4.9% over the last month, heading into earnings with an average analyst price target of $19.60 compared to the current share price of $15.29.
Boeing, Airbus, Major Airlines Push Congress for $20 Billion to Modernize Air Traffic Control
A coalition of U.S. aviation industry players is urging Congress to approve a $20 billion funding package to modernize the country's aging air traffic control systems and reduce flight disruptions. The group, which includes Boeing, Airbus, and the Airlines for America consortium representing carriers such as American Airlines and United Airlines, said the money would replace hundreds of outdated facilities and deploy next-generation technology for controllers. Transportation Secretary Sean Duffy has made ATC modernization a top priority, noting that the administration would need substantial financial support beyond the $12.5 billion previously approved by Congress. The Federal Aviation Administration expects to have 5,000 new high-speed network connections, 27,000 new radios, and 612 state-of-the-art radars in place by the end of 2028.
Smart City / Autonomous Infrastructure › Intelligent Traffic & Tolling Systems ▲Regulation
AIR.PA · Demand · Positive Airbus is part of the coalition pushing for $20B ATC modernization, which could lead to contracts for its technology or services.
BA · Demand · Positive Boeing is part of the coalition pushing for $20B ATC modernization, which could lead to contracts for its technology or services.
AAL · Demand · Positive Airlines for America, which includes American Airlines, pushes for ATC modernization that could reduce flight disruptions, benefiting operations.
UAL · Demand · Positive United Airlines, as part of Airlines for America, supports ATC modernization that could reduce flight disruptions.
San Antonio to Borrow $944 Million for Major Airport Expansion
San Antonio is tapping the bond market for about $944 million to help finance a 20-year development plan at its airport. The cornerstone of the project is a new Terminal C, costing roughly $1.7 billion, with up to 18 gates and more than 850,000 square feet of space, expected to open in June 2028. Delta Air Lines Inc. is committing $30 million to $40 million and American Airlines Group Inc. is investing $25 million to $35 million to build their own lounges in the terminal. The airport is anticipating nearly 15 million passengers by 2040, and the deal, rated A2 by Moody's Ratings and A+ by S&P Global Ratings, is expected to price on July 21 with RBC Capital Markets and Ramirez & Co. as lead underwriters.
AAL · Demand · Positive American Airlines is investing $25-35 million to build a lounge in the new Terminal C, indicating increased demand for its services at the airport.
DAL · Demand · Positive Delta Air Lines is committing $30-40 million to build a lounge in the new Terminal C, reflecting growth in passenger demand.
Zacks Adds Albemarle, American Airlines, and Aquestive Therapeutics to Strong Sell List
Zacks Investment Research added three stocks to its Zacks Rank #5 (Strong Sell) list today. Albemarle, a specialty chemicals company, saw its current-year earnings consensus estimate revised 29.1% downward over the last 60 days. American Airlines, a network air carrier, had its estimate cut by 22.1%. Aquestive Therapeutics, a specialty pharmaceutical company, experienced a nearly 16.7% downward revision.
American Airlines Earnings on July 23 in Focus as Investors Watch Fuel Costs and Demand
American Airlines Group is set to report second-quarter earnings on July 23, with investors closely watching fuel cost trends and demand signals following United Airlines' strong results. United topped earnings and revenue estimates and raised the lower end of its full-year earnings range, but also reported an 84% year-over-year surge in second-quarter fuel costs, warning that higher jet fuel prices could add nearly $6 billion in expenses this year. American Airlines shares closed at $15.63, down 0.26%, on trading volume of 181 million shares, about 83% above its three-month average. The broader market rose, with the S&P 500 gaining 0.38% to 7,572 and the Nasdaq Composite up 0.62% to 26,269.
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