American Airlines Stock Falls After Earnings. Here’s Why.

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American Airlines posted record revenue in the second quarter.

Patrick T. Fallon/AFP via Getty Images

American Airlines’ second-quarter earnings were good, but they weren’t quite good enough in the eyes of investors.

The carrier beat earnings expectations, posted record revenue, and followed Delta Air Lines (ticker: DAL) and

United Airlines

(UAL) in hiking full-year guidance.

But that hat-trick failed to lift American’s (AAL) shares, which pointed 2.9% lower ahead of the open. In contrast, shares in United Airlines, which reported record earnings late Wednesday, climbed 2%.

The fortunes of the two stocks are likely linked. Strong earnings from Delta last week and United last night placed more pressure, and expectation, on American’s earnings. The airline stock rally, inspired by strong international travel demand and lower fuel costs, has also raised the bar.

American stock has climbed 35% since May 24, the Wednesday before Memorial Day weekend, which kick-started the strong summer season. After United’s record earnings of $5.03 per share, a whole $1 above expectations, American’s needed to be great.

They were only very good.


reported adjusted earnings of $1.92 a share on revenue of $14.1 billion in the three months ended June 30. The carrier raised full-year earnings guidance to between $3 and $3.75 a share, up from a previous $2.50 to $3.50 range.

Analysts were expecting second-quarter earnings per share (EPS) of $1.59 on sales of $13.7 billion. American’s own guidance was for earnings of between $1.20 and $1.40 a share.

For the third quarter,…


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