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Posted On: 05/08/2017 11:52:03 AM
Post# of 2218
$AAL Airline Stock #1: American Airlines (AAL)
https://cabotwealth.com/daily/growth-stocks/b...5-8-17-tim
American is the largest airline in the world, with revenues of $40 billion. It was bankrupt in 2011; it merged with US Airways in 2013; and today it’s flying high (sorry), raking in $40.4 billion per year. Trouble is, American is not growing. Revenues shrank in the past two years and in the first quarter of this year, the company’s revenues missed analysts’ estimates, while the company’s after-tax profit margin was just 3.2%, the worst in many years.
Huge companies that aren’t growing often pay big dividends, but American’s dividend is only 1% because management doesn’t have enough confidence in future cash flows. The best thing I can say about AAL is that the stock is cheap, with a price/earnings ratio of just 5, so someday it might be a great value. But the stock has been underperforming the market for years
https://cabotwealth.com/daily/growth-stocks/b...5-8-17-tim
American is the largest airline in the world, with revenues of $40 billion. It was bankrupt in 2011; it merged with US Airways in 2013; and today it’s flying high (sorry), raking in $40.4 billion per year. Trouble is, American is not growing. Revenues shrank in the past two years and in the first quarter of this year, the company’s revenues missed analysts’ estimates, while the company’s after-tax profit margin was just 3.2%, the worst in many years.
Huge companies that aren’t growing often pay big dividends, but American’s dividend is only 1% because management doesn’t have enough confidence in future cash flows. The best thing I can say about AAL is that the stock is cheap, with a price/earnings ratio of just 5, so someday it might be a great value. But the stock has been underperforming the market for years
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