American Airlines: Not Hurt By Higher Oil Prices
Updated - Apr. 11, 2023
Delta Air Lines (DAL) guides up for Q2 and '23, yet the market yawns. American Airlines again fell on the strong guidance from the airline.
-“Delta is building momentum, with the best people in the industry generating nearly $5B of operating profit over the last twelve months,” CEO Ed Bastian said. “For the June quarter, we expect to deliver record revenue, and an adjusted operating margin of 14 to 16 percent with earnings per share of $2.00 to $2.25. With solid March quarter profitability and a strong outlook for the June quarter, we are confident in our full-year guidance for revenue growth of 15 to 20 percent year over year, earnings of $5 to $6 per share and free cash flow of over $2B.”
-The consensus EPS forecast for the second quarter stood at $1.64 while full-year forecasts were pegged at $5.37. The 15% to 20% revenue growth guide is also well above the 10.56% consensus.
Original article posted on April 7.
- American Airlines won't be harmed by higher oil prices.
- The airline reported profits last year with higher jet fuel costs.
- The stock is crazy cheap at 4.5x '23 EPS targets with further upside simply from repaying debt with large cash flows.