AAL Higher After U.S. Treasury Loan Approval

The shares of American Airlines Group Inc (NASDAQ: AAL) are up 0.8% at $12.92 this morning, after the U.S. Treasury agreed on terms for an emergency government loan that will benefit the carrier. In previous statements, the airline said it expects summer long-haul international capacity to decline by 25% in 2021 as a result of the COVID-19 outbreak, and that it will discontinue several international routes that were once popular destinations. The company also warned on Wednesday it is overstaffed by roughly 8,000 flight attendants, and that it might reduce its workforce through early retirement and voluntary leave.

Since dropping to an all-time-low of $8.25 on May 14, the equity has been chopping higher on the charts, with its 40-day moving average serving mostly as support over the past couple of weeks. Though shares peaked in early June at $22.80, they have since pulled back and found overhead pressure at the $14 mark. Longer term, AAL is struggling to recover, and remains down 60% year-over-year.

Analysts were mostly pessimistic toward the equity coming into today, with seven of the 13 in question sporting a "sell" or worse, three calling it a tepid "hold," and the rest carrying a "strong buy" recommendation. Meanwhile, the consensus 12-month price target of $13 is in line with current levels. And while short interest is down 12.4% in the last two reporting periods, the 129.26 million shares sold short make up a hefty 31% of AAL's available float, or 1.3 times the average daily trading volume.

In the options pits, the security's Schaeffer's put/call open interest ratio (SOIR) comes in at 1.24. This ranks in the 89th percentile of readings from the past year -- highlighting a strong appetite for puts over calls among short-term speculators.