What to expect from American Airlines Q4 2022 earnings amid upbeat travel demand?

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American Airlines (NASDAQ:AAL) is scheduled to announce Q4 earnings results on Thursday, January 26th, before market open.

The consensus EPS Estimate is $1.07 (+175.4% Y/Y) and the consensus Revenue Estimate is $13.2B (+40.0% Y/Y).

Analysts expects load factor of 84% for the quarter.

Earnings history:

The company has consistently exceeded the consensus mark past 5 quarters.
The company recently raised its outlook for Q4 and now expects total revenue to grow 16% to 17% as compared to Q4 2019, up from 11% to 13% in previous forecasts and adjusted EPS is expected to range from $1.12 to $1.17, about double the prior forecast of $0.50 to $0.70. Adjusted operating margin guidance was also hiked from a range of 5.5% to 7.5% to a 10.25% to 10.5% expectation.

The company also achieved more than half of its goal to reduce total debt by $15B by the end of 2025 after repayment of $7.5B in the past 18 months.

Over the last 2 years, AAL has beaten EPS estimates 100% of the time and has beaten revenue estimates 75% of the time.

Over the last 3 months, EPS estimates have seen 12 upward revisions and 0 downward. Revenue estimates have seen 8 upward revisions and 0 downward.

Peer Comparison:

Delta (DAL) reported Q4 earnings beat on Jan 13 with EPS growth of ~572% Y/Y on upbeat demand. CFO said, “We expect to deliver free cash flow of more than $2 billion in 2023 and further reduce debt on our path to reach investment grade metrics in 2024.”
United Airlines (UAL) also exceed consensus mark in Q4 last week.

Stock gets a Hold rating from Wall Street Analysts, based on 16 of 21 analysts’ ratings of Hold; 2 analysts ratings of Strong Buy, 2 analysts ratings of Sell, and 1 analyst rating of Strong Sell.

AAL gets a Strong buy rating form the SA Quant rating system.

Looking at the stock performance, AAL has outperformed the broader market index past 12 months. In Wednesday’s intraday session stock is trading at $16.37, +2.2%.