In the latest market close, United Airlines (UAL) reached $95.79, with a -1.69% movement compared to the previous day. The stock fell short of the S&P 500, which registered a gain of 0.05% for the day. Elsewhere, the Dow saw a downswing of 0.17%, while the tech-heavy Nasdaq appreciated by 0.4%.
The airline's shares have seen an increase of 26.14% over the last month, surpassing the Transportation sector's gain of 5.33% and the S&P 500's gain of 5.75%.
The investment community will be closely monitoring the performance of United Airlines in its forthcoming earnings report. It is anticipated that the company will report an EPS of $2.96, marking a 48% rise compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $14.36 billion, indicating a 5.37% growth compared to the corresponding quarter of the prior year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $10.23 per share and revenue of $56.73 billion. These totals would mark changes of +1.79% and +5.6%, respectively, from last year.
Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for United Airlines. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.45% higher. United Airlines is currently a Zacks Rank #2 (Buy).
In terms of valuation, United Airlines is currently trading at a Forward P/E ratio of 9.53. This represents a discount compared to its industry's average Forward P/E of 10.41.
Also, we should mention that UAL has a PEG ratio of 1.15. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Transportation - Airline industry held an average PEG ratio of 1.18.
The Transportation - Airline industry is part of the Transportation sector. Currently, this industry holds a Zacks Industry Rank of 24, positioning it in the top 10% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
