American Airlines Group Inc. Common Stock (AAL)

FairStock Score: 6/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach an airline with Graham's skepticism. American Airlines moves passengers through major hubs, but it sells a commodity, faces fierce competition, heavy fixed costs, fuel and labor swings, and has little pricing power. The numbers bear this out. In fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $16.7B but net income was only $71.0M, or $0.11 per diluted share. In fiscal Q1 2026, the quarter ended 2026-03-31, net income was -$382.0M and diluted EPS was -$0.58. In fiscal Q3 2025, the quarter ended 2025-09-30, net income was -$114.0M. In fiscal 2025, the year ended 2025-12-31, net income was $111.0M on $54.6B revenue, down from $846.0M in fiscal 2024, the year ended 2024-12-31, and $822.0M in fiscal 2023, the year ended 2023-12-31. That is a cyclical, thin-margin business. The computed Lynch category is CYCLICAL — Airlines: earnings follow the economic cycle. FairStock's return and health metrics are poor: ROCE 1.12%, Altman Z-score -0.03, and a FairStock Score of 6/100. The Piotroski F-score of 7/9 offers some hope, but not enough to offset the concerns. At the 2026-10-13 close of $12.50, market cap was $8.3B; FairStock's trailing P/E is -25.51, so earnings-based valuation is meaningless. FairStock's EV/EBITDA is 33.29, and FCF yield is 3.4%. The stock is near the low end of its $10.09-$18.79 52-week range, but a low price alone is not value. I want a margin of safety and a durable franchise; here I see a capital-intensive cyclical with fragile profits. I would need much clearer evidence of sustainable free cash flow and balance-sheet strength before calling it a bargain.

In plain English: American Airlines flies passengers and cargo through hubs in the United States and around the world. The business is huge, but profits are very thin and have been swinging between small gains and losses. At $12.50, the price looks full compared with those weak profits, even though the stock is near the lower end of its yearly range.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer