Analyst Upgrades: American Airlines Group Inc, Delta Air Lines, Inc., and United Continental Holdings Inc

Analysts upwardly revised their ratings and price targets on American Airlines Group Inc (NASDAQ:AAL), Delta Air Lines, Inc. (NYSE:DAL), and United Continental Holdings Inc (NYSE:UAL)

Nov 22, 2016 at 9:15 AM
facebook twitter linkedin

Imperial Capital chimed in on airline stocks American Airlines Group Inc (NASDAQ:AAL), Delta Air Lines, Inc. (NYSE:DAL), and United Continental Holdings Inc (NYSE:UAL) amid a historically positive week for the PowerShares Dynamic Leisure & Entertainment ETF (PEJ). Here's a quick roundup of today's the brokerage firm's bullish notes on AAL, DAL, and UAL.

  • For AAL, Imperial Capital raised its price target to $49 from $43. While this represents a slim 6.3% premium to last night's close at $46.08, it stands in territory not charted since May 2015. Nevertheless, shares of American Airlines Group Inc have been soaring since taking a strong bounce off their 120-day moving average in late September -- up 35.9%, and fresh off yesterday's annual high of $46.75. AAL stock is set to extend this positive price action today, too, trading 0.8% higher ahead of the bell. Short sellers, meanwhile, have been calling it a day. Short interest on AAL dropped 5.6% in the most recent reporting period, but still accounts for 7% of the equity's float -- or 4.2 times the average daily pace of trading.

  • The brokerage firm boosted its price target on DAL to $52 from $44, representing expected upside of 7% to Monday's settlement at $48.61. The airline stock looks ready to capitalize on the upbeat analyst note, last seen 0.4% higher in electronic trading. Longer term, shares of Delta Air Lines, Inc. are up 49.1% from their late-June post-Brexit annual low at $32.60, but have more recently run out of steam near $49. Options traders have been initiating long puts relative to calls at a near-annual-high clip in recent months, too. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), DAL's 50-day put/call volume ratio of 0.67 ranks 2 percentage points from a 52-week peak.

  • Imperial Capital increased its price target on UAL to $76 from $65 (while also lowering its rating to "in-line" from "outperform"). While the brokerage firm said the stock's recent surge up the charts is due to "positive management changes, labor agreements, and improvement in close-in bookings," it noted future gains will be dependent on "how successfully management executes its plan." Ahead of the bell, the shares of United Continental Holdings Inc are down 0.7%, after closing last night at $68.99. Today's projected price move shouldn't come as too much of a surprise, though. Considering UAL is up more than 84% from its late-June lows near $37.41 -- and tagged a 12-month high of $69.29 yesterday -- its 14-day Relative Strength Index (RSI) settled Monday at 86, well into overbought territory. In other words, a near-term breather may be in the cards.
Don't miss the market's next move! Sign up now for Schaeffer's Midday Market Check

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners