Shares of American Airlines Group Inc. shot up to an 11-month high on Thursday after the airline reported better-than-expected quarterly results, but Cowen analyst Helane Becker warned that prices “were off the fundamentals.” .
AAL shares
increased 43.4% in premarket trading, putting them on track to open at the highest price seen during regular sessions since Feb. 25. It also led to a one-day record gain, as the previous record was the 41.1% rally on June 4th.
Trading volume rose to 64.2 million shares less than an hour before opening, which already exceeds the full-day average of the last 30 days by about 53.7 million shares.
“We believe the measure is due to market outrage and America remains one of the shortest consensus airlines in our coverage (25% short interest as of 1/15/21)” , Becker wrote in a note to clients. “
Becker refers to trading dynamics that appear to have contributed to a brief reduction in stocks with a high number of short interest rates or to betting prices down, such as GameStop Corp. GME
and AMC Entertainment Holdings Inc. AMC
Do not miss it: It’s not just about GameStop: Here are some of the other very short actions that shoot above.
American previously reported falling to a fourth-quarter net loss of $ 2.188 billion, or $ 3.81 per share, from net income of $ 414 million, or 95 cents per share, in the previous year’s period. . Excluding non-recurring items, the adjusted loss per share was $ 3.86, surpassing the consensus of FactSet losses of $ 4.11.
Revenue fell 64% to $ 4.03 million, but surpassed the $ 3.888 billion FactSet consensus. The load factor fell to 63.4% from 84.7%, but exceeded expectations by 62.9%.
“As we look at next year, 2021 will be a year of recovery,” said Doug Parker, chief executive. “While we don’t know exactly when passenger demand will return, as vaccine distribution is achieved and travel restrictions are removed, we will be prepared.”
Cower’s Becker said he didn’t think the stock rally was fundamentally driven, as the U.S. outlook – “sequentially flat to slightly worse” – is similar to its peers who have already reported. (Read more about JetBlue Airways Corp. JBLU
Southwest Airlines Co. LUV
results, also reported Thursday.)
“It’s hard to say when the market will examine the company’s fundamentals, but we believe Americans could take this opportunity to off-balance sheet with a equity offering,” Becker wrote.
US stocks have risen 51.2% in the past three months to Wednesday, but have fallen 38.4% in the past 12 months. In comparison, the S&P 500 SPX index
it has gained 14.7% in the last three months and has increased by 14.5% over the last year.