American Airlines (AAL) is one of the largest airlines in the world. It transports the largest number of passengers throughout the world. It also is a founding member of the Oneworld alliance, founded on 1st February 1999. This company has its headquarters located in Forth Worth, Texas. The company commenced its operations in 1936, nearly 86 years ago. It flies to 269 domestic destinations and 81 international destinations. The Airline operates in 58 countries and five continents.
The beta for the AAL stock is 1.27, following value of the beta represents that the American Airlines stock’s return is 27% more volatile than the overall market. The company has a PE ratio of 3.33, which is neutral, following an operating margin of 15.39%. This company’s debt management seems poor as the company’s debt/equity ratio is -971.11%. It also represents that American Airlines has huge debt on it.
The American Airlines stock price has advanced by $0.04. It is currently trading at a level of $12.73. AAL is trading with an average volume of 25.56M (3 Months) and the current market cap of the stock is $8.317B. American Airlines has 643.136 Million floating shares available for trading in the market.
American Airlines Group Stock Performance Analysis
The American Airlines company’s revenue has been consistently advancing since 2020. However, the net income and profit margin of the company have been unstable over the years. The airline also has a huge debt of $43.69 Billion for the financial year 2022. The company’s cash flow has also gone negative, resulting in -$733.00M.
Performance Analysis of AAL Stock
Over the years American Airlines’ share has been meeting the estimated financials. The expected revenue for the year 2022 was $48.81B and the company reported a revenue of $48.81B. AAL suprised by 0.34% in revenue. The same trend has been followed by the company over the years.
AAL Stock Technical Analysis
The share price of American Airlines was following a rising channel for a long period of time. In the recent selling wave, the price of the AAL stock could not sustain the lower band of the channel. It resulted in the breakdown of the price through the channel leading to a bearish market structure.
As the share price of the AAL has declined below the channel. The EMAs are following a downtrend on the charts. The 50-day and the 200-day EMAs are trading in a death cross on the daily timeframe. It indicates the dominance of sellers in the AAL share price.
The AAL share’s RSI is also indicating sheer negativity in the momentum. It is happening because the RSI value has declined below the 30 level on the charts. Currently, the RSI has bounced to a level of 34.50, but it does not signify any bullish sentiment in the AAL stock price.
Conclusion
American Airlines has significant financials as the revenue is following an uptrend. Despite this advance in revenue, the company has reported huge debt throughout the years. The airline sector is also hit by inflation and economic fear. The high debt and fear in the market can be a reason for the decline in the AAL stock price. The technicals of the AAL shares like EMAs and the RSI are bearish on the charts.
Therefore, the AAL share price can continue to decline to a further lower level in the future and may hit the support levels.
Technical Levels
- Support levels for the AAL share are – $5.00 and $8.30
- Resistance levels for the AAL share are – $26.00 and $34.00
Disclaimer
The information provided in this article, including the views and opinions expressed by the author or any individuals mentioned, is intended for informational purposes only. It is important to note that the article does not provide financial or investment advice. Investing or trading in cryptocurrency assets carries inherent risks and can result in financial loss.
Source: https://www.thecoinrepublic.com/2023/10/05/fear-of-decline-in-travel-demand-leading-aal-shares-to-new-lows/