Out Fox The $treet

Interesting video from American Airlines (AAMRQ) uploaded to YouTube saying the merger is "cleared for takeoff". Anybody following this blog knows that Stone Fox Capital has been bullish on this merger with an investment in US Airways (LCC) . As the largest airline in the world, the new American Airlines Group (LCC ) should eventually claim the largest valuation as well. Disclosure: Long LCC. Please review the disclaimer page for more details. 

The surprising announcement on Nov. 12 that the Department of Justice, or DOJ, had agreed to a settlement allowing the merger of US Airways ( NYSE: LCC     ) and AMR Corporation ( NASDAQOTH: AAMRQ     ) to form the new American Airlines Group, with an expected close in December 2013. With this settlement in place and the merger proceeding, investors can now review three important numbers for the new American Airlines, which place the new company at very favorable multiples against industry leader  Delta Air Lines  ( NYSE: DAL     ) . Slot pairs manageable The DOJ agreement obliges US Airways and AMR Corp. to give up 52 slot pairs at Washington Reagan National Airport, or DCA, and 17 slot pairs at New York LaGuardia Airport, or LGA. The new American also has to divest two gates and related support facilities each at Boston Logan International Airport, Chicago O'Hare International Airport, Dallas Love Field, Los Angeles Int...

With all of the debates regarding the US Airways ( NYSE: LCC     ) merger with American Airlines ( NASDAQOTH: AAMRQ     ) , the market has missed the strong results of US Airways as a stand-alone company. Though the airline might need the merger to compete equally with the other major carriers, US Airways appears poised for better days regardless. The companies originally announced the merger back in February, but the Department of Justice (DOJ) shocked the markets by filing to block the merger in August. The stock plummeted on fears that the inability to further consolidate the industry would lead airlines to the price wars of the past. The August data doesn't suggest that scenario is actually occurring, or will occur. Read the full article here . Disclosure: Long LCC. Please review the disclaimer page for more details. 

Even with a fundamental shift in the airline sector, analysts are quick to downgrade US Airways Group (NYSE: LCC ) at market low earnings multiples. Sure the airline industry has historically struggled to make profits, but the recent consolidation provides hopes for a liberated industry. The company operates more than 3,100 flights per day and serves 198 communities around the globe. US Airways expects to close the merger with AMR more » Disclosure: No positions mentioned. Please review the disclaimer page for more details.