Core Viewpoint - American Airlines (AAL) stock experienced a decline of up to 10% despite exceeding Q2 earnings expectations, as the company provided a cautious outlook and narrowed its full-year EPS guidance amid ongoing travel demand uncertainty [1][7]. Financial Performance - In Q2, American Airlines reported sales of $14.39 billion, slightly up from $14.33 billion year-over-year and above estimates of $14.28 billion [3]. - The company's Q2 earnings per share (EPS) were $0.95, surpassing expectations of $0.79 by 20%, although this was a decrease from $1.09 EPS a year ago [3]. - The company reinstated but lowered its full-year EPS guidance to a range of a loss of $0.20 to a profit of $0.80, with a midpoint of $0.30, significantly lower than the previous forecast of $1.70 to $2.70 per share [7]. Market Dynamics - American Airlines benefited from strong international and premium cabin demand, particularly in the Atlantic markets, where passenger unit revenue increased by 5% year-over-year [4]. - The airline's loyalty program saw a 7% increase in Active AAdvantage accounts and a 6% rise in spending on co-branded credit cards, contributing to margin growth [5]. Valuation Metrics - Currently, American Airlines stock trades at 17.4 times forward earnings, which is a discount compared to the S&P 500's 24.5 times but higher than the Zacks Transportation-Airline Industry average of 14.5 times [9]. - The price-to-sales ratio for American Airlines is notably low at $0.15 for every dollar earned, compared to Delta and United Airlines, which are at $0.50 or more [10]. Outlook - The company anticipates an adjusted loss of $0.10 to $0.60 per share in Q3, citing weak domestic demand in July [8]. - Despite being the largest airline globally in terms of passengers and daily flights, the cautious outlook regarding EPS guidance suggests that better buying opportunities may arise in the future [12][14].

FORT WORTH, Texas, July 24, 2025 (GLOBE NEWSWIRE) -- American Airlines Group Inc. (NASDAQ: AAL) today reported its second-quarter 2025 financial results, including: "American delivered record revenue in an evolving demand environment in the second quarter thanks to the hard work and dedication of our team," said American's CEO Robert Isom. "We remain confident that the actions we have taken over the past several years to refresh our fleet, manage costs and strengthen our balance sheet position us well for t ...