AALAAL
US • —
$18.25
P/E
59.58
PEG
—
FCF Yield
—
Rev Growth YoY
+3.3% YoY
Gross Margin
64.7%
Health Score
3/10
D/E Ratio
6.43
Confidence
MEDIUM
Business Snapshot
AAL is an airline holding company operating one of the world's largest air carriers, generating primary revenue from passenger transportation across domestic and international networks. The airline operates in a highly competitive, capital-intensive industry characterized by thin margins, cyclical demand sensitivity, and significant exposure to fuel costs. It holds a major position in the US market with dominant hub operations at several key airports, supported by an extensive route network. The company is structured around a low-cost carrier model, differentiating through operational scale and frequent flyer program economics rather than luxury service.
Financial Health
Gross margin stands at a robust 64.7%, indicating a healthy markup on services, though the prior year comparison is not available for trend assessment. Net margin is razor-thin at just 0.4%, revealing that operational costs and fixed expenses consume nearly all of the gross profit...
Risk Assessment
- VALUATION — P/E of 59.58x is more than 2.5x the sector average of 22x, implying a heavy premium for current earnings.
- DEBT / LIQUIDITY — Debt/equity of 6.43x and a current ratio of 0.5x indicate a highly leveraged balance sheet with insufficient short-term liquidity.
- EARNINGS QUALITY — Earnings declined 56.2% year-over-year, a severe contraction that outweighs the 3 of 4 quarters earnings beat rate.
- TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed.
- VALUATION DIVERGENCE — Both DCF estimates are unavailable due to negative or missing free cash flow, preventing the calculation of an intrinsic value range....
Gross margin stands at a robust 64.7%, indicating a healthy markup on services, though the prior year comparison is not available for trend assessment. Net margin is razor-thin at just 0.4%, revealing that operational costs and fixed expenses consume nearly all of the gross profit. The balance sheet is severely stretched, with a debt/equity ratio of 6.43x, indicating aggressive leverage, and a current ratio of 0.5x, signaling insufficient short-term assets to cover immediate obligations. Return on equity is exceptionally high at 265.6%, a figure distorted by the company's negative equity base, not true operational efficiency. Free cash flow data is unavailable, preventing a direct assessment of cash generation or burn. The combination of high leverage, weak liquidity, and minimal net margin points to significant financial fragility, limiting the company's ability to invest or weather an economic downturn without raising additional capital.
- VALUATION — P/E of 59.58x is more than 2.5x the sector average of 22x, implying a heavy premium for current earnings. - DEBT / LIQUIDITY — Debt/equity of 6.43x and a current ratio of 0.5x indicate a highly leveraged balance sheet with insufficient short-term liquidity. - EARNINGS QUALITY — Earnings declined 56.2% year-over-year, a severe contraction that outweighs the 3 of 4 quarters earnings beat rate. - TECHNICALS — RSI, MACD, and moving average data unavailable for this period; momentum cannot be independently confirmed. - VALUATION DIVERGENCE — Both DCF estimates are unavailable due to negative or missing free cash flow, preventing the calculation of an intrinsic value range.
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