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United Airlines (UAL) Surpasses Market Returns: Some Facts Worth Knowing

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In the latest close session, United Airlines (UAL - Free Report) was up +1.93% at $107.74. The stock's performance was ahead of the S&P 500's daily gain of 0.68%. Elsewhere, the Dow gained 1.05%, while the tech-heavy Nasdaq added 0.33%.

The stock of airline has risen by 11.32% in the past month, leading the Transportation sector's gain of 4.66% and the S&P 500's gain of 1.8%.

The upcoming earnings release of United Airlines will be of great interest to investors. On that day, United Airlines is projected to report earnings of $3.03 per share, which would represent a year-over-year decline of 7.06%. In the meantime, our current consensus estimate forecasts the revenue to be $15.55 billion, indicating a 5.8% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates project earnings of $10.56 per share and a revenue of $59.19 billion, demonstrating changes of -0.47% and +3.72%, respectively, from the preceding year.

Investors should also note any recent changes to analyst estimates for United Airlines. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 2.49% fall in the Zacks Consensus EPS estimate. Currently, United Airlines is carrying a Zacks Rank of #3 (Hold).

Looking at its valuation, United Airlines is holding a Forward P/E ratio of 10.01. Its industry sports an average Forward P/E of 11.43, so one might conclude that United Airlines is trading at a discount comparatively.

It is also worth noting that UAL currently has a PEG ratio of 1. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Transportation - Airline industry stood at 0.77 at the close of the market yesterday.

The Transportation - Airline industry is part of the Transportation sector. At present, this industry carries a Zacks Industry Rank of 150, placing it within the bottom 40% of over 250 industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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