United Airlines Holdings Inc. (NASDAQ: UAL) will be offering a 5% pay increase to its pilots ahead of schedule, as reported by the Wall Street Journal.
The move comes after months of prolonged negotiations between the airline and its pilot union that were unsuccessful in reaching an agreement.
During the pandemic years, United had committed that it would increase pilots’ pay once the airline returned to profitability. Travel demand saw an upsurge, and airfares have increased by over 40% compared to the prior year.
Last week, approximately 14,000 United pilots rejected the proposals made by the airline because they fell short of their expectations. United was offering the pilots a tentative deal that included a 14.5% pay raise over the next 1.5 years.
As planned earlier, the 5% pay increase was scheduled to take place in May 2023. However, due to the discontent amongst pilots, the company will now do it months before, with the pay raise applicable from December 2022.
Is UAL a Good Stock to Buy?
As per TipRanks, analysts are cautiously optimistic about the United Airlines stock and have a Moderate Buy consensus rating, which is based on six Buys, one Hold, and one Sell. United Airlines’ average price forecast of $56.13 implies 26.62% upside potential.
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