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American Airlines has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the preceding four quarters (missing the mark in the other), the average beat being 107.4%.
American Airlines Group Inc. Price and EPS Surprise
The Zacks Consensus Estimate for AAL’s second-quarter 2024 earnings is currently pegged at $1.04 per share, has been revised downward by 20.61% in the past 60 days. Additionally, the consensus mark implies a 45.83% decline from the year-ago actuals. The Zacks Consensus Estimate for second-quarter 2024 revenues is currently pegged at $14.42 billion, suggesting a 2.60% uptick from the year-ago actuals.
Given this backdrop, let’s see how things have been shaped up for AAL this earnings season.
We expect upbeat air travel demand, particularly on the domestic front, to have boosted American Airlines’ top-line performance in the to-be-reported quarter. Passenger revenues, which account for the bulk of the top line, are likely to have been high, boosting total revenues. Per our model, passenger revenues in the second quarter of 2024 are likely to have increased 2.3% from the second-quarter 2023 actuals.
Discounting pressure at the low end of the market might have hurt AAL’s pricing power, in turn impacting its performance. The practice of price cuts by low-cost carriers, as the company struggled to fill the excess seats this summer, has been hurting even bigger rivals. Discount carriers have added too many seats that the company is now attempting to fill by lowering fares and compelling airline majors to do the same in a bid to stay competitive. AAL’s results might have been hurt due to the price cuts.
In May, American Airlines’ management trimmed its earnings per share outlook for second-quarter 2024. CEO Robert Isom stated that the softness pertaining to bookings was due to changes in the airline's sales strategy. American Airlines expects adjusted earnings per share in the $1-$1.15 band (earlier guidance was in the $1.15-$1.45 range).
Second-quarter total revenues per available seat miles are now expected to decline in the 5-6% band from the year-ago levels (a dip of 1-3% was expected previously). System capacity (measured in available seat miles or ASMs) is estimated to have increased in the 7-9% band from second-quarter 2023 actuals. Per our model, ASMs are estimated to have increased by 7.1% in the second quarter of 2024 from the prior-year quarter’s actuals. Average fuel price per gallon is now envisioned in the $2.7-$2.8 band (earlier guidance was in the $2.75-$2.95 range). We expect the average fuel price per gallon to be $2.76 for the June quarter.
What Our Model Says
Our proven model does not predict an earnings beat for American Airlines this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
American Airlines has an Earnings ESP of -0.52% and a Zacks Rank #5 (Strong Sell). You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
CPA will release results on Aug 7. Upbeat air-travel demand is likely to have aided the second-quarter performance.
The Zacks Consensus Estimate for CPA’s second-quarter 2024 earnings has been revised downward by 17.1% in the past 60 days to $2.98 per share. CPA has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 20.19%.
Expeditors International of Washington (EXPD - Free Report) currently has an Earnings ESP of +0.69% and a Zacks Rank #2. EXPD is scheduled to report second-quarter 2024 earnings on Aug 6. Lackluster volumes (with respect to air-freight tonnage and ocean containers) due to weakening demand and falling rates are likely to have hurt EXPD’s performance in the to-be-reported quarter.
The Zacks Consensus Estimate for second-quarter earnings has been revised 2.5% upward the last 60 days. EXPD surpassed the Zacks Consensus Estimate for earnings in only one of the preceding four quarters and missed thrice, the average negative earnings surprise being 3.44%.
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What's in Store for American Airlines (AAL) in Q2 Earnings?
American Airlines (AAL - Free Report) is scheduled to report second-quarter 2024 results on Jul 25, before market open.
American Airlines has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the preceding four quarters (missing the mark in the other), the average beat being 107.4%.
American Airlines Group Inc. Price and EPS Surprise
American Airlines Group Inc. price-eps-surprise | American Airlines Group Inc. Quote
The Zacks Consensus Estimate for AAL’s second-quarter 2024 earnings is currently pegged at $1.04 per share, has been revised downward by 20.61% in the past 60 days. Additionally, the consensus mark implies a 45.83% decline from the year-ago actuals. The Zacks Consensus Estimate for second-quarter 2024 revenues is currently pegged at $14.42 billion, suggesting a 2.60% uptick from the year-ago actuals.
Given this backdrop, let’s see how things have been shaped up for AAL this earnings season.
We expect upbeat air travel demand, particularly on the domestic front, to have boosted American Airlines’ top-line performance in the to-be-reported quarter. Passenger revenues, which account for the bulk of the top line, are likely to have been high, boosting total revenues. Per our model, passenger revenues in the second quarter of 2024 are likely to have increased 2.3% from the second-quarter 2023 actuals.
Discounting pressure at the low end of the market might have hurt AAL’s pricing power, in turn impacting its performance. The practice of price cuts by low-cost carriers, as the company struggled to fill the excess seats this summer, has been hurting even bigger rivals. Discount carriers have added too many seats that the company is now attempting to fill by lowering fares and compelling airline majors to do the same in a bid to stay competitive. AAL’s results might have been hurt due to the price cuts.
In May, American Airlines’ management trimmed its earnings per share outlook for second-quarter 2024. CEO Robert Isom stated that the softness pertaining to bookings was due to changes in the airline's sales strategy. American Airlines expects adjusted earnings per share in the $1-$1.15 band (earlier guidance was in the $1.15-$1.45 range).
Second-quarter total revenues per available seat miles are now expected to decline in the 5-6% band from the year-ago levels (a dip of 1-3% was expected previously). System capacity (measured in available seat miles or ASMs) is estimated to have increased in the 7-9% band from second-quarter 2023 actuals. Per our model, ASMs are estimated to have increased by 7.1% in the second quarter of 2024 from the prior-year quarter’s actuals. Average fuel price per gallon is now envisioned in the $2.7-$2.8 band (earlier guidance was in the $2.75-$2.95 range). We expect the average fuel price per gallon to be $2.76 for the June quarter.
What Our Model Says
Our proven model does not predict an earnings beat for American Airlines this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
American Airlines has an Earnings ESP of -0.52% and a Zacks Rank #5 (Strong Sell). You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
Copa Holdings (CPA - Free Report) has an Earnings ESP of +2.52% and carries a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
CPA will release results on Aug 7. Upbeat air-travel demand is likely to have aided the second-quarter performance.
The Zacks Consensus Estimate for CPA’s second-quarter 2024 earnings has been revised downward by 17.1% in the past 60 days to $2.98 per share. CPA has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 20.19%.
Expeditors International of Washington (EXPD - Free Report) currently has an Earnings ESP of +0.69% and a Zacks Rank #2. EXPD is scheduled to report second-quarter 2024 earnings on Aug 6. Lackluster volumes (with respect to air-freight tonnage and ocean containers) due to weakening demand and falling rates are likely to have hurt EXPD’s performance in the to-be-reported quarter.
The Zacks Consensus Estimate for second-quarter earnings has been revised 2.5% upward the last 60 days. EXPD surpassed the Zacks Consensus Estimate for earnings in only one of the preceding four quarters and missed thrice, the average negative earnings surprise being 3.44%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.