American Airlines is one of the biggest airlines in The United States. As unpredictability is an inherent nature of the airline industry, American Airlines is no exception. Talking about finances, this company has seen it all, starting from bankruptcy in 2011 to a peak of almost 55$ per share in 2018.
Timeline of the company
In 2001 after the pension scandal, where the airline routed pension funds to increase the bonuses for their executives, American airlines were just recovering when 9/11 occurred, where 2 American Airlines were involved in the crashes. AAL stock price at https://www.webull.com/quote/nasdaq-aal plummeted to an all-time7$ per share in 2012, after which they filed for bankruptcy in 2013. They survived the bankruptcy by merging with US Airways to become the biggest Airline in The United States.
Things took off after the merger. The airline had the most number of routes and the largest fleet, profits were flowing in, and in 2018 their stocks reached their peak of 55$ per share. Their total profits stood at almost 10 billion dollars in 2016 from 3 billion in 2014. After this, they started investing in their fleet. They bought new aircraft and refurbished their entire fleet to attract more passengers. They were flying more than 2.5 million passengers a day. In 2019 their stock prices took a nosedive after their fleet of Boeing 737 Max aircraft were grounded after two fatal crashes involving the aircraft in Asia, and the future of the aircraft they had on the order was not making things easy. Many flights had to be canceled sometimes. There were as many as 70 flights in a day.
Pandemic Setbacks
As they were slowly recovering from that setback, the global pandemic hit them in 2020. As Covid 19 pandemic brought the entire world to a standstill, the airline industry has been the worst, and being the biggest airline in America did not help American Airlines. All flights except for essential flights were cancelled, American Airlines had to dish out almost 70 million dollars a day in operational costs alone. AAL stock price reached as low as 9$ per share in May. Things did not improve much after that; currently, their stocks are valued at 12 $ per share.
They have been in survival mode ever since they have cut as many as 19000 jobs this year. They have about 62 billion dollars in liabilities, and their assets amounted to 50 billion dollars that put their outstanding liabilities at 13 billion dollars. This is after putting their entire fleet as collateral. This means that the company’s future will be ridden with debt, and their main focus will be on keeping the company afloat. If you want to buy this stock, you can check its cash flow at https://www.webull.com/cash-flow/nasdaq-aal.
Sum up
The stocks are not expected to bounce back anytime soon amid a crisis. Maybe in 2021, as the global economy gains momentum, things may turn out for American Airlines.
Disclaimer: The analysis information is for reference only and does not constitute an investment recommendation.