UAL is readying itself for next week's second-quarter report
United Airlines Holdings Inc (NASDAQ:UAL) is trading 2.5% higher at $129.43 this afternoon, joining the broader market rally and adding to its healthy 16% year-to-date lead. The equity yesterday suffered a fifth-straight daily drop, with today's gains capped by the overhead $130 level.
Today's jump comes just ahead of the company's second-quarter earnings report, due out after the close on Wednesday, July 15. Zacks estimates the airliner to report earnings per share of $1.89 on revenue of $17.69 billion—the latter figure being a 16.1% premium to the same quarter last year.
United Airlines stock has a split post-earnings performance. Over the past two years, four next-day sessions have ended lower, including a 5.6% drop in April. Over the eight quarters the shares have averaged a move of 4.1% regardless of direction, while this time around analysts are anticipating a larger-than-usual 8% shift.
Investors should be wary of downgrade potential, with 22 of the 24 analysts in coverage sporting a "buy" or "strong buy" recommendation. Should this bullish sentiment begin to unwind, it could trigger headwinds for the shares.
Shorts seem to be firmly in control as well. Of the 15.21 million shares sold short, this accounts for 4.7% of the stock's available float. At UAL's average pace of trading it would take shorts over two days to buy back their bearish bets.