Fact based stock research
American Airlines (NasdaqGS:AAL)
US02376R1023
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
American Airlines stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 45 (worse than 55% compared with investment alternatives), American Airlines (Airlines, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of American Airlines are a good value (attractively priced) with a consolidated Value Rank of 93 (better than 93% of alternatives) but show below-average growth (Growth Rank of 41), and are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 45, is a hold recommendation based on American Airlines's financial characteristics. As the company American Airlines's key financial metrics exhibit good value (Obermatt Value Rank of 93) but low growth (Obermatt Growth Rank of 41) and risky financing practices (Obermatt Safety Rank of 10), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 93% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Airlines |
| Index | Energy Efficient, NASDAQ, S&P 500 |
| Size class | XX-Large |
14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: American Airlines
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 53 |
|
73 |
|
92 |
|
93 |
|
| GROWTH | ||||||||
| GROWTH | 63 |
|
66 |
|
85 |
|
41 |
|
| SAFETY | ||||||||
| SAFETY | 3 |
|
4 |
|
4 |
|
10 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
53 |
|
58 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
48 |
|
79 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 45 (worse than 55% compared with investment alternatives), American Airlines (Airlines, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of American Airlines are a good value (attractively priced) with a consolidated Value Rank of 93 (better than 93% of alternatives) but show below-average growth (Growth Rank of 41), and are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 45, is a hold recommendation based on American Airlines's financial characteristics. As the company American Airlines's key financial metrics exhibit good value (Obermatt Value Rank of 93) but low growth (Obermatt Growth Rank of 41) and risky financing practices (Obermatt Safety Rank of 10), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 93% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 53 |
|
73 |
|
92 |
|
93 |
|
| GROWTH | ||||||||
| GROWTH | 63 |
|
66 |
|
85 |
|
41 |
|
| SAFETY | ||||||||
| SAFETY | 3 |
|
4 |
|
4 |
|
10 |
|
| COMBINED | ||||||||
| COMBINED | 32 |
|
39 |
|
75 |
|
45 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 93 (better than 93% compared with alternatives) for 2024, American Airlines shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for American Airlines. Price-to-Sales (P/S) is 93, which means that the stock price compared with what market professionals expect for future sales is lower than for 93% of comparable companies, indicating a good value regarding American Airlines's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 100% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 100. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 1% of all competitors have even lower dividend yields than American Airlines (a Dividend Yield Rank of 1). 99% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 93, is a buy recommendation based on American Airlines's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 93 |
|
93 |
|
93 |
|
93 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 7 |
|
71 |
|
87 |
|
100 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 100 |
|
95 |
|
100 |
|
100 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 53 |
|
73 |
|
92 |
|
93 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 41 (better than 41% compared with alternatives), American Airlines shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for American Airlines. Only Capital Growth has a good rank of 84, which means that currently professionals expect the company to grow its invested capital more than 25% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 42 which means that currently professionals expect the company to grow less than 58% of its competitors. Profit Growth with a rank of 25 and Stock Returns with a rank of 41 are also low (below 59% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 41, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for American Airlines is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 23 |
|
88 |
|
38 |
|
42 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 33 |
|
42 |
|
100 |
|
25 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
26 |
|
71 |
|
84 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 84 |
|
63 |
|
59 |
|
41 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 63 |
|
66 |
|
85 |
|
41 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company American Airlines has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of American Airlines is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for American Airlines. Liquidity is at 26, meaning that the company generates less profit to service its debt than 74% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 4, meaning the company has an above-average debt-to-equity ratio. It has more debt than 96% of its competitors. Finally, Refinancing is at a rank of 7 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 93% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 10 (worse than 90% compared with alternatives), American Airlines has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of American Airlines because it may suffer significantly in case of future difficulties. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 10 |
|
2 |
|
4 |
|
4 |
|
| REFINANCING | ||||||||
| REFINANCING | 1 |
|
37 |
|
7 |
|
7 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 8 |
|
15 |
|
18 |
|
26 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 3 |
|
4 |
|
4 |
|
10 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
15 |
|
27 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
97 |
|
79 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
48 |
|
88 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
24 |
|
27 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
53 |
|
58 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for American Airlines from November 14, 2024.
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