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United Airlines Holdings (UAL)
NASDAQ:UAL
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United Airlines Holdings
(NASDAQ:UAL)
76Outperform
Positive Factors
Financial Performance
UAL is expected to outperform due to its revenue diversification, strong loyalty program, and free cash flow generation.
Stock Buyback
UAL is buying back stock, taking advantage of volatile equity markets, signaling confidence in its future value.
Negative Factors
International Revenues
International revenues for UAL have seen a decline in Europe and Canada, with Europe down -6% and Canada -9%.
Macroeconomic and Geopolitical Issues
Macroeconomic weakness and geopolitical tensions could curb discretionary spending on travel.
Price Target Revision
The price target for United Airlines Holdings, Inc. stock has been lowered from $37.00 to $35.00.
United Airlines Holdings (UAL) vs. S&P 500 (SPY)
Market Cap
$24.01B
Dividend YieldN/A
Average Volume (3M)10.54M
Price to Earnings (P/E)6.7
Beta (1Y)1.28
Revenue Growth5.31%
EPS Growth35.95%
CountryUS
Employees109,200
SectorIndustrials
Sector Strength77
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)0.91
Shares Outstanding326,600,560
10 Day Avg. Volume6,864,808
30 Day Avg. Volume10,540,933
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.68
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit2.08
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$97.79Price Target Upside29.78% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering15
United Airlines Holdings Business Overview & Revenue Model
Company DescriptionUnited Airlines Holdings, Inc. (UAL) is a major American airline holding company headquartered in Chicago, Illinois. It primarily operates through its wholly owned subsidiary, United Airlines, which is one of the largest airlines in the world. United Airlines serves a comprehensive network of domestic and international routes, offering passenger transportation services across the Americas, Europe, Asia-Pacific, Africa, and the Middle East. The company is a member of the Star Alliance, which is a global airline network that provides enhanced connectivity and benefits to travelers.
How the Company Makes MoneyUnited Airlines Holdings makes money primarily through the sale of airline tickets to passengers, which constitutes the bulk of its revenue. The company offers various ticket classes, including economy, premium economy, business, and first class, each with different pricing structures and amenities. In addition to passenger ticket sales, UAL generates revenue from ancillary services, such as baggage fees, seat upgrades, in-flight food and beverage sales, and loyalty program memberships through its MileagePlus program. Cargo transportation services also contribute to its earnings, as the company transports goods and mail across its network. Additionally, United enters into partnerships and alliances that enhance its market reach and operational efficiency, including code-sharing agreements and joint ventures with other airlines.
United Airlines Holdings Key Performance Indicators (KPIs)
Any
Average Fuel Price
Monitors the cost of fuel, a significant expense for airlines, impacting profitability and influencing ticket pricing strategies.
Monitors the cost of fuel, a significant expense for airlines, impacting profitability and influencing ticket pricing strategies.
Data provided by:
Main Street Data
Main Street DataUnited Airlines Holdings Financial Statement Overview
Summary
United Airlines has exhibited a solid recovery with strong revenue and profit growth, indicating a positive trajectory. Profitability and cash generation are robust; however, high leverage poses a potential risk. The company's financial health reflects a balanced state with strengths in profitability and cash flow, offset by high debt levels.Income Statement
United Airlines shows strong recovery post-pandemic with consistent revenue growth from $15.36 billion in 2020 to $57.74 billion TTM. Gross profit margin improved significantly, reaching 43% TTM. Net profit margin stands at 6.34%, indicating profitability. EBIT and EBITDA margins have also strengthened, reflecting operational efficiency.85
Very Positive
Balance Sheet
While total assets have grown to $76.11 billion, the company maintains a high debt-to-equity ratio of 2.31 TTM, suggesting significant leverage. Return on equity is robust at 29%, indicating effective use of equity. Equity ratio remains moderate at 16.57%, showing limited equity buffer.70
Positive
Cash Flow
Operating cash flow has steadily increased to $9.87 billion TTM, demonstrating strong cash generation. Free cash flow growth shows volatility but is positive at $2.71 billion TTM. The operating cash flow to net income ratio of 2.70 indicates strong cash conversion from net income.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 57.06B | 53.72B | 44.95B | 24.63B | 15.36B | Gross Profit |
| 19.42B | 15.20B | 10.64B | 721.00M | -5.03B | EBIT |
| 5.10B | 4.21B | 327.00M | -368.00M | -6.36B | EBITDA |
| 8.50B | 7.83B | 5.12B | 1.50B | -5.34B | Net Income Common Stockholders |
| 3.15B | 2.62B | 737.00M | -1.96B | -7.07B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 14.47B | 14.39B | 16.41B | 18.41B | 11.68B | Total Assets |
| 74.08B | 71.10B | 67.36B | 68.17B | 59.55B | Total Debt |
| 33.63B | 36.74B | 36.43B | 40.20B | 32.75B | Net Debt |
| 24.86B | 30.68B | 29.27B | 21.92B | 21.48B | Total Liabilities |
| 61.41B | 61.78B | 60.46B | 63.15B | 53.59B | Stockholders Equity |
| 12.68B | 9.32B | 6.90B | 5.03B | 5.96B |
| Cash Flow | Free Cash Flow | |||
| 3.83B | -260.00M | 1.25B | -40.00M | -5.86B | Operating Cash Flow |
| 9.45B | 6.91B | 6.07B | 2.07B | -4.13B | Investing Cash Flow |
| -2.65B | -6.11B | -13.83B | -1.67B | 10.00M | Financing Cash Flow |
| -4.18B | -1.89B | -3.35B | 6.40B | 12.96B |
United Airlines Holdings Technical Analysis
Positive
75.35
Price Trends
73.17
Positive
87.76
Negative
75.66
Negative
Market Momentum
0.39
Negative
58.64
Neutral
74.74
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UAL, the sentiment is Positive. The current price of 75.35 is above the 20-day moving average (MA) of 68.81, above the 50-day MA of 73.17, and below the 200-day MA of 75.66, indicating a neutral trend. The MACD of 0.39 indicates Negative momentum. The RSI at 58.64 is Neutral, neither overbought nor oversold. The STOCH value of 74.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UAL.
United Airlines Holdings Risk Analysis
United Airlines Holdings disclosed 29 risk factors in its most recent earnings report. United Airlines Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
United Airlines Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $24.01B | 6.70 | 33.57% | ― | 5.31% | 35.95% | |
75 Outperform | $29.26B | 8.07 | 27.52% | 1.23% | 4.91% | -27.21% | |
74 Outperform | $26.51B | 15.34 | 21.21% | 1.67% | 5.39% | -15.92% | |
70 Outperform | $10.63B | 22.15 | 42.32% | 3.45% | -2.03% | -11.39% | |
64 Neutral | $4.25B | 11.69 | 5.23% | 249.83% | 4.04% | -9.46% | |
59 Neutral | $17.00B | 35.72 | 5.63% | 2.41% | 3.26% | 27.77% | |
58 Neutral | $6.88B | 12.04 | -21.27% | ― | 1.92% | 36.07% |
* Industrials Sector Average
Performance Comparison
UAL
United Airlines Holdings
75.35
22.33
42.12%
DAL
Delta Air Lines
45.30
-6.42
-12.41%
PAC
Grupo Aeroportuario del Pacifico
222.46
44.62
25.09%
RYAAY
Ryanair Holdings
50.83
-0.77
-1.49%
LUV
Southwest Airlines
30.28
3.73
14.05%
AAL
American Airlines
10.56
-3.86
-26.77%
United Airlines Holdings Earnings Call Summary
Earnings Call Date:Apr 15, 2025
(Q1-2025)
| % Change Since: 12.46%|
Next Earnings Date:Jul 16, 2025
Earnings Call Sentiment Neutral
United Airlines demonstrated strong financial performance and resilience through record revenue, brand loyalty, and cost management. However, challenges such as softer domestic demand, international traffic declines, and economic uncertainties pose risks. Despite these challenges, the company maintains a positive outlook for the year.Q1-2025 Updates
Positive Updates
Record First Quarter Revenue
United Airlines reported a record revenue of $13.2 billion for the first quarter of 2025, marking a 5.4% increase from the previous year.
Strong Performance in Premium Segments
Premium cabin unit revenues were up mid-single digits, with international Polaris RASMs up 8% and international premium plus RASMs up over 5%.
High Customer Loyalty
United Airlines has gained significant market share and brand loyalty in key hubs like Chicago, Denver, and the Bay Area, leading in brand loyalty among six of its seven hubs.
Cost Management Success
CASM X increased by only 0.3% year-over-year, reflecting strong cost management efforts.
Strong Free Cash Flow and Reduced Debt
Generated over $2 billion in free cash flow and reduced debt by $1 billion in the first quarter, with a net leverage reduced to 2.0 times.
Positive Outlook for Full-Year Earnings
Even in a weaker economic environment, United expects to earn $7 to $9 per share for the full year 2025.
Negative Updates
Softer Domestic Demand
Domestic main cabin RASMs were down 5% year-over-year, attributed to softer demand and a weaker macroeconomic environment.
Potential Revenue Decline in Recession Scenario
In a recessionary environment, United expects an additional five-point reduction in total revenue for the remainder of the year.
Challenges in Non-US Origin International Traffic
International passengers originating from Europe and Canada are booked lower year-over-year by 6% and 9%, respectively.
Impact of Tariffs and Global Uncertainties
Ongoing global trade policies and potential tariffs could impact aircraft prices and supply chain stability.
Company Guidance
In the first quarter of 2025, United Airlines demonstrated resilience despite a softer macroeconomic environment, achieving the highest first quarter pretax margins since the onset of COVID-19. Demonstrating strong brand loyalty, United is projected to be one of only two profitable airlines this quarter. The company expects full-year earnings per share to range from $7 to $9, even in a potential recessionary environment. United has achieved a 3.3% pre-tax margin and a 5.4% increase in top line revenue to $13.2 billion. Domestically, RASMs fell by 5%, while international premium plus RASMs rose by over 5%. Loyalty revenue grew by 9% to $1.5 billion, and the company reduced domestic capacity by four points for the summer. Despite these challenges, United remains confident in its strategy, expecting to generate a full-year free cash flow approaching $3 billion in a base case scenario.United Airlines Holdings Corporate Events
Business Operations and StrategyFinancial Disclosures
United Airlines Reports Record Q1 2025 Profit
Positive
Apr 15, 2025
On April 15, 2025, United Airlines announced its best first-quarter financial performance in five years, despite a challenging macroeconomic environment. The company reported a first-quarter profit with record revenue of $13.2 billion and achieved significant growth in various revenue streams, including premium cabin and international travel. United Airlines is making strategic adjustments, such as reducing domestic capacity and retiring aircraft, to maintain resilience and industry-leading margins. The company is also investing in technology and infrastructure to enhance customer experience, including expanding at major airports and improving in-flight services.
Spark’s Take on UAL Stock
According to Spark, TipRanks’ AI Analyst, UAL is a Outperform.
United Airlines Holdings shows strong financial performance and positive earnings guidance, with significant growth and operational achievements. The technical analysis indicates short-term upward momentum, though medium-term resistance exists. An undervalued P/E ratio enhances the stock’s appeal, despite the absence of dividends. While the overall outlook is positive, attention to leverage and external operational challenges like FAA staffing and OEM delays is necessary.
To see Spark’s full report on UAL stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.