IB Net Payout Yields Model

American Airlines Group: How Embracing the 120-Day Distribution Set Investors Up for Long-Term Gains

As part of its bankruptcy agreement, American Airlines Group (NASDAQ: AAL  ) had to distribute a large amount of shares to creditors and labor groups around the 120th day following the finalization of the US Airways merger. The company's stock had already survived a few smaller distributions, but the large distribution in early April but more pressure on it.

Whether due to the general market weakness or the stock distribution, the stock dropped from a high of $38 in early April to a bottom of $32. While a substantial increase in the amount of shares available to be sold by creditors and labor unions might have pressured the stock short term, most stocks eventually trade based on the fundamentals of the company and the industry.

Read the full article here.

Disclosure: Long AAL. Please read the disclaimer page for more details.


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