American Airlines Stock Falls On Guidance, Bottom Nearing?

Steve Miller

American Airlines stock price (NYSE:AAL) traded -5% lower on Wednesday morning, after lowering guidance Q2 unit revenue.

American Airlines provided updated guidance for an industry metric known as “total revenue per available seat mile”. The company clarified that revenue growth would be 1-3% compared to previous estimate of 1.5-3.5%.

The change was due to “lower than anticipated domestic yields”.

The airline also lowered its projection for Q2 capacity for available seat miles from 73.1 to 72.9 billion and raised their fuel cost projection from $2.18-$2.23 to $2.24-$2.29 per gallon. As well, they announce the cost containment measure of eliminating straws and stir sticks from their cabins and lounges, as reported by Reuters.

In analyzing the market cycles on the AAL weekly chart, we can see that the stock is in the final stages of its decline. With both the minor and intermediate cycles ending at the same time, we expect a rebound soon.

Our near term target is $41.

American Airlines (AAL) Stock Chart with Weekly Bars

american airlines stock research outlook aal chart image july 2018

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