United (UAL) Up 5.4% Since Last Earnings Report: Can It Continue?

Core Viewpoint - United Airlines has shown a positive trend in its stock performance, with shares increasing by 5.4% since the last earnings report, outperforming the S&P 500. Investors are curious whether this trend will continue leading up to the next earnings release [1]. Financial Performance - In Q4 2025, United Airlines reported adjusted earnings per share of $3.10, exceeding the Zacks Consensus Estimate of $2.98, but reflecting a year-over-year decline of 4.9%. The earnings fell within the guided range of $3.00-$3.50 [2]. - Operating revenues reached $15.4 billion, slightly surpassing the Zacks Consensus Estimate by 0.1% and increasing by 4.8% year over year. Passenger revenues, which constituted 90.4% of total revenues, rose by 4.9% year over year to $13.9 billion [3]. - The airline transported 45,679 passengers in Q4, marking a 3% increase year over year. However, cargo revenues decreased by 6% year over year to $490 million [3]. Revenue Sources - Diverse revenue streams contributed positively to the fourth-quarter results, including premium cabin revenues (up 9% year over year), Basic Economy revenues (up 7% year over year), and loyalty revenues (up 10%) [4]. Traffic and Capacity - Airline traffic, measured in revenue passenger miles, grew by 5.9%, while capacity, measured in available seat miles, expanded by 6.5%. Despite the increase in traffic, it did not outpace capacity growth, leading to a consolidated load factor decline of 0.4 points year over year to 81.9% [5]. Revenue Metrics - Consolidated passenger revenue per available seat mile decreased by 1.4% year over year, and total revenue per available seat mile fell by 1.6% year over year. The average yield per revenue passenger mile dropped by 0.9% year over year to 20.41 cents [6]. Operating Expenses - Operating expenses increased by 6.2% year over year to $14 billion. The consolidated unit cost, excluding fuel and other specific expenses, inched up by 0.4% year over year to 12.94 cents [7]. Cash Position and Share Repurchase - At the end of Q4, United Airlines had cash and cash equivalents of $5.94 billion, down from $6.73 billion in the previous quarter. Long-term debt and financial liabilities were $20.5 billion, slightly down from $20.8 billion [8]. Future Outlook - For Q1 2026, United Airlines anticipates adjusted EPS between $1.00 and $1.50, and for the full year 2026, adjusted EPS is expected to be between $12.00 and $14.00. Total capital expenditures for 2026 are projected to be less than $8 billion [9]. Estimate Trends - There has been an upward trend in estimates for United Airlines over the past month, with the consensus estimate shifting by 29.28% [10][11]. VGM Scores - United Airlines currently holds an average Growth Score of C and a similar score for momentum, but has an A score for value, placing it in the top 20% for this investment strategy. The overall aggregate VGM Score is B [12]. Industry Performance - United Airlines is part of the Zacks Transportation - Airline industry. Delta Air Lines, a competitor, reported revenues of $16 billion for the quarter ended December 2025, reflecting a year-over-year change of +2.9% [14].