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Earnings Estimates Moving Higher for American Airlines (AAL): Time to Buy?
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American Airlines (AAL - Free Report) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company.
The upward trend in estimate revisions for this world's largest airline reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For American Airlines, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.
Current-Quarter Estimate Revisions
The company is expected to earn $1.28 per share for the current quarter, which represents a year-over-year change of +68.42%.
Over the last 30 days, five estimates have moved higher for American Airlines while one has gone lower. As a result, the Zacks Consensus Estimate has increased 26.43%.
Current-Year Estimate Revisions
The company is expected to earn $2.77 per share for the full year, which represents a change of +454% from the prior-year number.
There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, seven estimates have moved up for American Airlines versus one negative revision. This has pushed the consensus estimate 14.27% higher.
Favorable Zacks Rank
Thanks to promising estimate revisions, American Airlines currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Bottom Line
American Airlines shares have added 10.3% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.
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Earnings Estimates Moving Higher for American Airlines (AAL): Time to Buy?
American Airlines (AAL - Free Report) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company.
The upward trend in estimate revisions for this world's largest airline reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For American Airlines, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.
Current-Quarter Estimate Revisions
The company is expected to earn $1.28 per share for the current quarter, which represents a year-over-year change of +68.42%.
Over the last 30 days, five estimates have moved higher for American Airlines while one has gone lower. As a result, the Zacks Consensus Estimate has increased 26.43%.
Current-Year Estimate Revisions
The company is expected to earn $2.77 per share for the full year, which represents a change of +454% from the prior-year number.
There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, seven estimates have moved up for American Airlines versus one negative revision. This has pushed the consensus estimate 14.27% higher.
Favorable Zacks Rank
Thanks to promising estimate revisions, American Airlines currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Bottom Line
American Airlines shares have added 10.3% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.