American Airlines Group Inc. (NASDAQ: AAL) Active Investors Trying To Balance a Gains after Quarterly Sales Expectation


American Airlines Group Inc. (NASDAQ: AAL) decreases over 2.5% in pre-trading session on Thursday following a last date surge after announcing that it expects to exceed third-quarter revenue forecast, the latest good indication for the sector after a number of US airlines hailed the unexpected strength of post-Labor Day leisure travel and a continued rebound in business flights.

Revenue is likely to be up approximately 13% over the same quarter last year, the Fort Worth, Texas-based airline said in a regulatory statement Tuesday. This is somewhat more than the company’s previous forecast of no more than a 12% growth. The airline’s pre-tax margin is likely to reach 4.5%, beating its target by up to 4%.

American is the first of the four main US airlines to offer an early look at the third quarter, which ended on September 30, and its projection could help set the tone for earnings results from Delta Air Lines Inc. on Thursday and other carriers later this month. On October 20, American will release its quarterly earnings.

The airline’s stock was up 2.7% at 9:37 a.m. in New York, after rising as much as 6.7%. American has dropped 33% this year as of Monday’s closing. In the filing, the airline did not disclose fourth-quarter or full-year guidance.

At the high end of an early prediction, costs for each seat flown a mile will rise roughly 14% in the quarter over 2019. The statistics do not include jet fuel or special equipment. Flying capacity was 9.6% lower than it was before the epidemic, which is near to the 10% reduction predicted by American.

United Airlines Holdings Inc. upped its third-quarter revenue forecast last month due to sustained leisure demand after Labor Day, when holiday travel typically declines and corporate flights increase. Southwest Airlines Co. also stated that those flights were helping to offset a weaker rebound in corporate travel revenues.

While domestic business travel income has generally rebounded to pre-pandemic levels or greater, carriers have yet to witness a full recovery of corporate passenger numbers. This is mostly attributable to overseas travel, which has been slower to recover owing to travel restrictions in some countries.