American Airlines Group Inc (NASDAQ:AAL) received a single operating certificate from the Federal Aviation Administration (FAA) for American and US Airways, marking a major milestone in the integration of the two airlines.
The FAA’s approval for American and US Airways to operate under one certificate is the culmination of more than 18 months of work aligning the carriers’ operating policies and procedures. Beginning today, most flight operations, maintenance and dispatch procedures will be identical for all flights. Air traffic control communications will refer to all American and US Airways flights with the call sign “American.”
“Achieving a single operating certificate is an important step toward becoming a fully integrated airline and the effort to reach today’s milestone touched nearly every area of our company,” said Robert Isom, American’s Chief Operating Officer. “For a project of this scope, many entities and people must come together and see it through to completion, but one person must ultimately oversee it in its entirety. With that, our appreciation for the leadership of Captain and Senior Vice President, Integration Operations Ed Bular, who oversaw this massive project, along with the CAVOK Group under the leadership of Vice President Jim Ballough, cannot be overstated. Likewise, our frontline employees and the union leaders who represent them are to be enthusiastically applauded for their role in learning and implementing new policies and procedures and adhering to those as we move forward under one certificate.
“The FAA’s Joint Transition Team, led by Skip Whitrock, helped guide us through a rigorous process designed to ensure that our airline is built on a solid foundation of regulatory compliance. We are extremely appreciative of the valuable direction that Skip, Division Managers Nick Reyes and Larry Fields and all at the FAA have provided us over the past year.
“Lastly, as a global airline, this work spanned many regions. We thank the Department of Transportation and regulatory authorities in more than 50 countries who worked alongside us to ensure this critical project remained on track.”
Isom concluded, “While today marks a significant milestone for our integration, there is still much that remains ahead and we will intensify our focus on moving to a single reservations system and website and combining our frontline employee workgroups.”
A team of more than 700 employees reviewed 465 manuals along with policies, procedures and programs from both carriers and selected best practices to implement for the merged airline. More than 110,000 employees completed hundreds of thousands of hours of training in multiple phases and more than 115,000 pages on policies and procedures were published.
The FAA’s recognition of American as a single operator does not mean change for customers, who will continue to check in for their flights on aa.com, usairways.com, or at American or US Airways ticket counters until later this year when American moves to a single reservations system.
Since American and US Airways merged in December 2013, the airline has been making steady integration progress, including inducting US Airways into the oneworld alliance, merging separate frequent flyer programs into the single AAdvantage program and reaching five-year joint collective bargaining agreements with its pilots and flight attendants. (Original Source)
Shares of American Airlines opened today at $47.8 and are currently trading up at $48.1876. AAL has a 1-year high of $56.20 and a 1-year low of $28.10. The stock’s 50-day moving average is $50.43 and it’s 200-day moving average is $46.23.
On the ratings front, American Airlines has been the subject of a number of recent research reports. In a report issued on April 1, Deutsche Bank analyst Michael Linenberg downgraded AAL to Hold, with a price target of $58, which represents a potential upside of 21.3% from where the stock is currently trading. Separately, on February 24, Cowen’s Helane Becker downgraded the stock to Hold and has a price target of $55.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Michael Linenberg and Helane Becker have a total average return of 27.6% and 33.0% respectively. Linenberg has a success rate of 65.3% and is ranked #80 out of 3569 analysts, while Becker has a success rate of 80.0% and is ranked #14.
In total, 4 research analysts have assigned a Hold rating and 5 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $47.8 which is 39.0% above where the stock opened today.
American Airlines Group Inc, through its subsidiaries, operates in the airline industry. The Company has hubs in Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York City, Philadelphia, Phoenix and Washington, D.C.