American Airlines (AAL) Stock Takes Flight After Delta's Earnings Victory

TLDR

Table of Contents

American Airlines (AAL) stock surged 13.7% after Delta Air Lines reported strong Q2 earnings and optimistic travel industry outlook
The broader airline sector received a boost as Delta’s results often serve as an industry bellwether
Investors expect Delta’s robust demand and favorable travel trends to be reflected in American’s upcoming earnings
American Airlines has $29.4 billion in long-term debt, approximately double Delta’s total debt load
The stock is down 24.2% year-to-date and trading 30.9% below its 52-week high of $18.66

American Airlines stock jumped 13.7% in Thursday’s morning session after rival Delta Air Lines delivered better-than-expected second-quarter results. The surge came as investors rushed into airline stocks across the board.

Delta’s earnings report helped calm investor nerves after a disappointing first quarter for the industry. Airlines had scaled back expectations earlier in the year due to concerns about inflation and tariffs.

The Atlanta-based carrier not only beat expectations but also reinstated full-year guidance. Their earnings forecast came in ahead of the consensus estimate, painting a brighter picture for the travel sector.

American Airlines shares closed at $12.97, representing a 13.02% gain for the day. The stock has experienced considerable volatility, with 20 moves greater than 5% over the past year.

Delta’s results often serve as a bellwether for the airline industry. When Delta performs well, investors typically assume other carriers are experiencing similar conditions.

Delta Air Lines, $DAL, Q2-25. Results:
🟢 +8% Pre-Market
📊 Adj. EPS: $2.10 🟢
💰 Revenue: $15.5B 🔴
📈 Net Income: $2.13B
🔎 Record revenue and strong operational performance powered by premium products, loyalty growth, and solid international demand. pic.twitter.com/3Bg3f7bEcq
— EarningsTime (@Earnings_Time) July 10, 2025

The positive earnings report suggested that demand is holding up well through the summer vacation season. This is crucial timing for airlines, as summer represents their most profitable period.

Summer Travel Demand Holds Strong

First-quarter earnings had painted a sobering picture of the airline industry. Carriers talked down expectations for the year, leaving investors uncertain about what was to come.

Thursday’s results from Delta helped shift that narrative. The company’s performance indicated that travel demand remains robust despite earlier concerns.

Investors are betting that American Airlines will benefit from the same favorable travel trends. The company’s upcoming earnings report will provide more clarity on whether this optimism is justified.

American Airlines shares remain down 24.2% since the beginning of the year. The stock is trading 30.9% below its 52-week high of $18.66 from January 2025.

The current price of $12.89 per share reflects ongoing investor concerns about the airline’s financial position. American carries $29.4 billion in long-term debt, about double Delta’s total debt load.

Debt Concerns Persist Despite Rally

While American should have the ability to service its debt, the heavy load makes the company more vulnerable to potential downturns. This debt burden distinguishes American from its financially stronger competitor Delta.

The two airlines have approximately the same enterprise value-to-earnings multiple when factoring in debt. This similar valuation makes Delta appear more attractive to risk-averse investors.

American’s stock has been particularly volatile, with moves this large being rare even for the carrier. The 13.7% jump indicates that Delta’s earnings report had a major impact on market perception.

Trading volume reached 18,008 shares, well below the average volume of 59,506,484. The stock’s day range was between $12.13 and $13.18.

Investors who bought $1,000 worth of American Airlines shares five years ago would now be looking at an investment worth $1,079. The company’s market cap currently stands at $9 billion.

The airline sector’s performance will likely depend on whether other carriers can match Delta’s strong results when they report earnings in the coming weeks.

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