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United (UAL) Down 1.4% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for United Airlines (UAL - Free Report) . Shares have lost about 1.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is United due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Earnings Beat in Q4
Quarterly earnings per share (excluding 31 cents from non-recurring items) of $3.26 surpassed the Zacks Consensus Estimate of $3.01. The bottom line increased 63% on a year-over-year basis. The reported figure exceeded the company guided range of $2.50-$3.00.
Operating revenues of $14.7 billion beat the Zacks Consensus Estimate of $14.4 billion. The top line increased 7.8% year over year due to upbeat air-travel demand. This was driven by a 6.9% rise in passenger revenues (which accounted for 90.3% of the top line) to $13.3 billion. Almost 44,344 passengers traveled on UAL flights in the fourth quarter, up 6.1% year over year.
Cargo revenues grew 29.6% year over year to $521 million. Revenues from other sources rose 12% from the fourth quarter of 2023 to $899 million.
Other Details of UAL’s Q4 Earnings
Below, we present all comparisons (in % terms) with the fourth quarter of 2023 figures unless otherwise stated.
Airline traffic, measured in revenue passenger miles, grew 6.3%. Capacity, measured in available seat miles, expanded 6.2%. Although traffic outpaced capacity expansion, the consolidated load factor (percentage of seat occupancy) of 82.3% remained flat on a year-over-year basis, reflecting consistent passenger demand for the airline's services. Our estimate is pegged at 80.5%.
Consolidated passenger revenue per available seat mile (a key measure of unit revenues) inched up 0.6%. Total revenue per available seat mile increased 1.6% to 18.77 cents. The average yield per revenue passenger mile rose 0.6% to 20.59 cents.
Average aircraft fuel price per gallon fell 23.3% to $2.40. Our estimate is pegged at $2.81. Fuel gallons consumed were up 5.3%.
Operating expenses (on a reported basis) increased 4.5% to $13.2 billion. Consolidated unit cost or cost per available seat mile , excluding fuel, third-party business expenses, profit-sharing and special charges, decreased 1.6% to 16.85 cents. UAL exited the fourth quarter with cash and cash equivalents of $8.76 billion compared with $8.81 billion at the prior-quarter end. Long-term debt, finance leases, and other financial liabilities were $25.2 billion at the fourth-quarter end.
UAL’s Outlook
For the first quarter of 2025, UAL expects adjusted EPS in the range of $0.75-$1.25. For 2025, UAL expects adjusted EPS between $11.50 and $13.50. For 2025, UAL expects adjusted capital expenditures to be less than $7 billion.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 64.78% due to these changes.
VGM Scores
At this time, United has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise United has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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United (UAL) Down 1.4% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for United Airlines (UAL - Free Report) . Shares have lost about 1.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is United due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Earnings Beat in Q4
Quarterly earnings per share (excluding 31 cents from non-recurring items) of $3.26 surpassed the Zacks Consensus Estimate of $3.01. The bottom line increased 63% on a year-over-year basis. The reported figure exceeded the company guided range of $2.50-$3.00.
Operating revenues of $14.7 billion beat the Zacks Consensus Estimate of $14.4 billion. The top line increased 7.8% year over year due to upbeat air-travel demand. This was driven by a 6.9% rise in passenger revenues (which accounted for 90.3% of the top line) to $13.3 billion. Almost 44,344 passengers traveled on UAL flights in the fourth quarter, up 6.1% year over year.
Cargo revenues grew 29.6% year over year to $521 million. Revenues from other sources rose 12% from the fourth quarter of 2023 to $899 million.
Other Details of UAL’s Q4 Earnings
Below, we present all comparisons (in % terms) with the fourth quarter of 2023 figures unless otherwise stated.
Airline traffic, measured in revenue passenger miles, grew 6.3%. Capacity, measured in available seat miles, expanded 6.2%. Although traffic outpaced capacity expansion, the consolidated load factor (percentage of seat occupancy) of 82.3% remained flat on a year-over-year basis, reflecting consistent passenger demand for the airline's services. Our estimate is pegged at 80.5%.
Consolidated passenger revenue per available seat mile (a key measure of unit revenues) inched up 0.6%. Total revenue per available seat mile increased 1.6% to 18.77 cents. The average yield per revenue passenger mile rose 0.6% to 20.59 cents.
Average aircraft fuel price per gallon fell 23.3% to $2.40. Our estimate is pegged at $2.81. Fuel gallons consumed were up 5.3%.
Operating expenses (on a reported basis) increased 4.5% to $13.2 billion. Consolidated unit cost or cost per available seat mile , excluding fuel, third-party business expenses, profit-sharing and special charges, decreased 1.6% to 16.85 cents. UAL exited the fourth quarter with cash and cash equivalents of $8.76 billion compared with $8.81 billion at the prior-quarter end. Long-term debt, finance leases, and other financial liabilities were $25.2 billion at the fourth-quarter end.
UAL’s Outlook
For the first quarter of 2025, UAL expects adjusted EPS in the range of $0.75-$1.25. For 2025, UAL expects adjusted EPS between $11.50 and $13.50. For 2025, UAL expects adjusted capital expenditures to be less than $7 billion.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 64.78% due to these changes.
VGM Scores
At this time, United has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise United has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.