American Airlines Taps Credit Lines For Cash Injection, Analyst Downgrades Stock to Sell

“The bearish scenario is playing out,” the analyst told investors, with air travel potentially suspended this summer due to the coronavirus pandemic. He believes that AAL could emerge from the crisis a much smaller player, with reduced capacity and routes.

For AAL one potential source of further revenue is monetizing airline mileage programs. According to DeNardi this could raise about $4 billion for American Airlines, however the analyst cautioned that “If airlines start seriously talking about mileage presales, we’ll know things are particularly dire.”

Taking a step back, we can see that the stock shows a Hold consensus rating on TipRanks- with six analysts advising investors to sell AAL in the last three months. That’s versus 5 hold ratings and only 3 buy ratings published in the same period. Meanwhile the average analyst price target stands at $19. (See AAL’s stock analysis on TipRanks)

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