2 Airline Stocks in Focus After Earnings

UAL hit a 2-year high while AAL is sliding on the charts

Deputy Editor
Jul 20, 2023 at 1:47 PM
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Earnings season is in full swing, with the Dow Jones Industrial Average (DJI) and Nasdaq Composite (IXIC) moving wildly different directions due to several big-name reports.

Amid the volatility, two airline stocks have the attention of options traders after their respective reports. It's also worth noting that the U.S. House of Representatives just voted to raise the mandatory commercial pilot retirement age by two years to 67, among other aviation reforms. 

United Airlines Holdings Inc (NASDAQ:UAL) announced a strong second-quarter report after the close yesterday, which included the company's highest-ever quarterly profit, and raised its 2023 forecast. UAL is up 4.9% at $57.49 at last glance and trading at fresh two-year highs, with a year-to-date gain now up to 52.6%. 

The stock has already seen 2.3 times the average daily volume in the options pits, with 58,000 calls and 29,000 puts exchanged so far. The July 58 call is the most active contract, expiring tomorrow at the close. 

American Airlines Group Inc (NASDAQ:AAL) is down 6.4% at $17.41 at last check following its second-quarter report, released before the open today. Though the airline announced better-than-expected second-quarter results and lifted its full-year forecast, investors are still unsatisfied with the outlook (and may be comparing the results with UAL's record earnings). AAL is today slipping below its 20-day moving average, which has provided support for the past couple months, though the shares still sport a strong 38.3% year-to-date lead. 

So far, 112,000 calls and 56,000 puts have crossed the tape. Expiring tomorrow, the July 18 call is the most popular, with new positions being bought to open there. Worth pointing out as well -- all top 20 open interest (OI) positions are puts. 

 

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