American Airlines shares surge on carrier’s second-quarter forecast

American Airlines shares surge on carrier’s better second-quarter forecast

American Airlines shares rose after the carrier forecast better revenue and a narrower loss than previously estimated for the second quarter, the latest sign that airlines are recovering from the coronavirus pandemic’s toll on travel.

The Fort Worth, Texas-based carrier said Tuesday that it expects to post a “slight” pretax profit for the second quarter. It said it will likely report results ranging from a net loss of $35 million to a net profit of $25 million for the three months ended June 30. Excluding net special items, it expects a net loss of up to $1.2 billion and an adjusted per-share loss of between $1.67 and $1.76. That compares with analysts estimates of $2.44 a share.

“We are clearly moving in the right direction,” CEO Doug Parker and President Robert Isom said in a staff note.

American’s stock was up more than 3% in morning trading Wednesday.

Air travel has bounced back sharply since the spring, when Covid-19 vaccines rolled out widely around the U.S. and officials lifted restrictions that shuttered attractions from indoor dining to theme parks.

American said it flew 44 million passengers in the second quarter, an 82% increase from the first three months of 2021, though still below 2019 levels.

Revenue for the quarter ended last month likely came in 37.5% below the same period of 2019, when it generated $11.96 billion, compared with an earlier estimate of a 40% drop.

CNBC

By News784

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