AAL Stock - American Airlines Group Inc.Fundamentals & Analysis

Air Transportation, Scheduled

American Airlines Group Inc. is a large U.S. network carrier providing passenger and cargo air transportation, with a financial profile characterized by volatile profitability and cash flows alongside pockets of stronger operating performance. Strengths The company shows clear strengths in margin recovery and cash generation: gross margin improved to 40.8% and operating margin reached 12.5% in the

American Airlines Group Inc.

Air Transportation, Scheduled
Stock Price
$14.87
$-0.08 (-0.54%)
Jul 28, 2026
Debt to Equity
96.7%
ROE
0.8%
PE Ratio
37.52
EPS (Diluted)
-$0.17

American Airlines Group Inc (AAL) Fundamental Analysis

American Airlines Group Inc. is a large U.S. network carrier providing passenger and cargo air transportation, with a financial profile characterized by volatile profitability and cash flows alongside pockets of stronger operating performance.

Strengths

The company shows clear strengths in margin recovery and cash generation: gross margin improved to 40.8% and operating margin reached 12.5% in the most recent observations Profit Margin Trends, and trailing twelve‑month operating cash flow was $2.65B versus trailing net income of $202.0M, indicating operating cash generation materially above accounting earnings Earnings Quality Analysis. Leverage on a simple balance basis is moderate with debt-to-equity at 0.97, under the 1.0 threshold cited in recent metrics, suggesting a manageable headline debt ratio even as financing activity has been a net outflow recently Strategic Capital Allocation.

Weaknesses

There are also notable weaknesses. Profitability and per‑share performance remain highly volatile: diluted EPS 1‑year growth turned deeply negative (−82.9%) and revenue per share fell −87.9% year over year in the latest reported period, with split‑adjusted revenue per share sliding from $74.75 (EPS Diluted & Revenue per Share) to $9.08 (Revenue & EPS Growth) and most recent diluted EPS of $0.29 (EPS Diluted & Revenue per Share). Liquidity is a secondary concern: the current ratio is 0.54, below 1.0, while quarterly net income continues to alternate between sizable profits and losses (−$382.0M for the period ending Revenue & Net Income) and trailing twelve‑month net income has been modest at $202.0M.

Key Metrics & Outlook

Key fundamentals to watch going forward include trends in operating cash flow versus net income (current OCF TTM $2.65B and NI TTM $202.0M) and whether gross margin and operating margin sustain recent levels (40.8% and 12.5%) Earnings Quality Analysis Profit Margin Trends. Also monitor per‑share metrics—revenue per share ($9.08 most recently) and diluted EPS growth (−82.9% in the most recent year)—along with ROE (0.8%) and near‑term liquidity (current ratio 0.54) and any moves in the company’s P/E ratio, most recently 37.5x, as indicators of earnings stability and capital structure dynamics Return on Equity (ROE) Price-to-Earnings (PE) Ratio Trend Revenue & Net Income.

Revenue and Growth

Revenue Trend

Revenue & Net Income

The foundation of business quality and long-term value creation

Revenue & Net Income Growth

Net Income Volatility

American Airlines Group Inc.'s quarterly net income series shows pronounced volatility in the most recent quarters. From a loss of -$312.0M in 2024-Q1, the company posted a positive $717.0M in 2024-Q2, then returned to a loss of -$149.0M in 2024-Q3 and a larger loss of -$473.0M in 2025-Q1. The pattern continued with a rebound to $599.0M in 2025-Q2, smaller losses in 2025-Q3 (-$114.0M) and a modest profit in 2025-Q4 ($99.0M), followed by a decline to a loss of -$382.0M in 2026-Q1, indicating alternating swings between profitability and losses in recent quarters.

Revenue Trends

Revenue entries in the provided dataset include large annual figures earlier in the series and a more recent reported amount for the period ending 2024-12-31. The data shows $52.75B for the period ending 2023-12-31 and $48.97B for 2022-12-31, with a later reported value of $6.41B for the period ending 2024-12-31. The most recent reported revenue is $6.41B (period end 2024-12-31) and the most recent net income is a loss of $382.0M (period end 2026-03-31).

Why Growth Matters

Consistent revenue and earnings growth are the lifeblood of successful long-term investments. Companies that can grow their top line (revenue) and bottom line (net income) over many years demonstrate they have products or services customers value and are willing to pay for repeatedly.

Revenue Growth shows whether the company is expanding its market reach, gaining market share, or successfully launching new products.Net Income Growth demonstrates the company can convert that revenue into actual profits while managing costs effectively.

Look for steady, sustainable growth rather than erratic spikes. The best businesses compound earnings year after year, creating tremendous value for shareholders over time. Companies that can grow earnings faster than revenue are improving their profitability—a sign of operational excellence and competitive strength.

American Airlines Group Inc. (AAL) quarterly revenue and net income trend analysis showing historical financial performance over multiple years. Interactive chart displaying revenue growth, net income trends, and profitability patterns for AAL stock with quarterly and annual data points.

EPS Diluted & Revenue per Share

Per-share earnings and revenue — the shareholder's view of growth

Why Per-Share Metrics Matter

Total revenue and net income can grow simply because a company issues more shares or makes acquisitions. Per-share metrics cut through that noise — they show how much value each single share of stock is generating, which is what actually matters to shareholders.

Revenue per Share (split-adjusted) tells you how much revenue the business generates for every share outstanding. Growing revenue per share means the company is either expanding the business or shrinking the share count — both shareholder-friendly signals.EPS Diluted (split-adjusted) captures bottom-line earnings per share after accounting for all dilutive instruments such as stock options and convertible debt.

The most powerful signal is when both lines rise together over many years. If revenue per share grows but EPS lags, margins are being squeezed. If EPS grows faster than revenue per share, the company is becoming more profitable — a hallmark of businesses with durable competitive advantages. Watch for share buybacks, which can mechanically lift EPS even if total earnings are flat.

American Airlines Group Inc. (AAL) EPS diluted and revenue per share trend showing historical per-share earnings and revenue performance over time.

Revenue & EPS Growth

Year-over-year growth rates for revenue and earnings per share

Reading the Growth Rate Chart

This chart converts the absolute per-share figures into year-over-year percentage changes, making it easy to see whether growth is accelerating, decelerating, or reverting to trend — regardless of the company's absolute size.

Revenue per Share Growth (1-year, split-adjusted) measures how quickly the top line is expanding on a per-share basis. Sustained positive growth signals that the company continues to win customers and grow its addressable market.EPS Diluted Growth (1-year, split-adjusted) measures how quickly earnings are compounding for each shareholder. When EPS growth consistently outpaces revenue growth, operating leverage and margin expansion are at work.

Look for consistency, not just magnitude. A company that reliably grows EPS 10–15% per year is far more valuable than one that alternates between 50% spikes and deep contractions. Negative EPS growth during a period of positive revenue growth is a red flag — costs are rising faster than sales. Quarters where both lines converge near zero or go negative deserve close scrutiny.

American Airlines Group Inc. (AAL) year-over-year revenue per share and EPS diluted growth rate trend analysis showing historical growth performance.

Revenue Analysis

Revenue Waterfall Analysis

How revenue converts to net income for the most recent annual period

American Airlines Group Inc. (AAL) revenue waterfall chart showing the breakdown from total revenue to net income. Displays cost of goods sold, operating expenses, selling and administrative costs, research and development expenses, tax expenses, and final net income for AAL. Annual financial statement waterfall analysis showing profit margin components and expense structure.

Period Information

Report Type: Annual (10-K)

Period: Jan 2024 to Dec 2024

Profitability

Profit Margins

Earnings Quality

Earnings Quality Analysis

Comparing reported earnings to actual cash generation

Earnings Quality Analysis — Net Income vs Operating Cash Flow (TTM)

American Airlines Group Inc.'s trailing twelve-month net income showed a pronounced peak in 2023, reaching $2.63B in the period ending 2023-06-30, then declined through late 2023 and 2024 with an interim loss of -$121.0M in the period ending 2024-06-30 and subsequent smaller positive results. In the most recent reported quarters net income has moderated to the low hundreds of millions, with the latest TTM net income at $202.0M (period ended 2026-03-31).

Operating cash flow (TTM) has trended lower from a high of $4.32B (period ended 2023-03-31) to $3.80B at 2023-12-31 and $2.65B at 2024-03-31. Across the most recent overlapping periods in the dataset, operating cash flow remains materially higher than net income. The most recent Net Income (TTM) was $202.0M (period ended 2026-03-31) and the most recent Operating Cash Flow (TTM) was $2.65B (period ended 2024-03-31).

The Earnings vs. Cash Flow Gap

Reported earnings (Net Income) doesn't always reflect actual cash generation. Companies use accrual accounting, which recognizes revenue when earned and expenses when incurred—not when cash actually changes hands. This creates timing differences and opportunities for accounting discretion that can mask underlying business health.

Net Income (the "earnings" number) can be influenced by non-cash items like depreciation, stock-based compensation, and changes in accounting estimates.Operating Cash Flow, however, shows the actual cash the business generates from its core operations—a harder number to manipulate.

What to Look For

  • Consistent Alignment: High-quality earnings show operating cash flow tracking closely with or exceeding net income over time. This indicates the company is actually collecting cash from its reported profits.
  • Warning Sign - Divergence: If net income consistently exceeds cash flow, the company may be reporting earnings that aren't translating to cash. This could indicate aggressive revenue recognition, growing receivables that may not be collected, or inventory building up.
  • Positive Sign - Cash Exceeds Earnings: When cash flow exceeds net income, it often reflects conservative accounting (like accelerated depreciation) or strong working capital management. This is generally a sign of high earnings quality.
  • Quarterly Volatility is Normal: Some variation is expected due to timing of collections, seasonal factors, and one-time items. Focus on the trend over multiple quarters rather than any single period.

Key Insight: Companies with durable competitive advantages typically show operating cash flow that meets or exceeds net income over time, demonstrating they convert accounting profits into actual cash that can be returned to shareholders or reinvested in the business.

Return on Equity

Return on Equity (ROE)

Measuring management's efficiency at generating profits from shareholder capital

Return on Equity (ROE) — American Airlines Group Inc.

American Airlines Group Inc.'s ROE moved from a positive recovery in early 2023 into a steady decline through 2024–2025. ROE peaked at 9.4% in the quarter ending 2023-03, then fell to 4.9% (2023-12), 2.6% (2024-03), 1.3% (2024-09), and reached 0.5% in 2025-12 before a small uptick to 0.8% in 2026-03. The most recent quarters show ROE near zero after the post-pandemic rebound.

Historical Inflection Points

Notable earlier inflection points include deeply negative ROE during the pandemic (for example −32.3% in 2021-03, −18.4% in 2022-03, and −13.4% in 2022-06) and historic outliers in 2014–2015 (ROE above 100% in several quarters). The most recent trailing twelve-month Return on Equity (ROE) was 0.8% (period ending 2026-03-31).

The Gold Standard of Profitability

Return on Equity (ROE) is a powerful measure of how effectively a company's management is using the money shareholders have invested. Calculated by dividing Net Income by Shareholders' Equity, it reveals how much profit is generated for every dollar of equity capital.

A consistently high ROE (typically above 15-20%) is often the signature of a "quality" business with a durable competitive advantage. It indicates that the company can generate high returns on its own capital, which it can then reinvest at these high rates to compound value over time.

What to Look For:

  • Consistency: Look for an ROE that is stable or rising over time. Erratic ROE can signal cyclicality or inconsistent management.
  • Quality vs. Leverage: While a high ROE is generally positive, it can sometimes be artificially inflated by high debt (leverage). Always cross-reference ROE with the company's Debt-to-Equity ratio to ensure the profitability is coming from operational excellence rather than excessive borrowing.
  • Comparison: ROE is most meaningful when compared against industry peers or the company's own historical average.
American Airlines Group Inc. (AAL) Return on Equity (ROE) historical trend analysis. Quarterly chart showing the company's return on equity over time, reflecting management's efficiency in using shareholder capital.

Capital Allocation & Cash Flow

Capital Strategy

Strategic Capital Allocation

How the company generates and deploys its cash

Strategic Capital Allocation — Cash Flow Allocation Trend (TTM)

American Airlines Group Inc.'s trailing twelve-month operating cash flow has declined over the most recent year. Operating cash flow was $4.32B at the 2023-03-31 TTM, fell to $3.80B at the 2023-12-31 TTM, and most recently was $2.65B at the 2024-03-31 TTM, indicating a downward trajectory in cash generated from operations across those reporting periods.

Investing Cash Flow

Investing cash flow has been negative in recent TTM snapshots after a positive reading at the end of 2022. It was $636.0M at 2022-12-31 TTM, moved to -$1.39B at 2023-03-31 TTM, improved to -$502.0M at 2023-12-31 TTM, and most recently was -$968.0M at 2024-12-31 TTM.

Financing Cash Flow

Financing cash flow shifted from large inflows in 2020–2021 to net outflows more recently, with financing cash flow at -$2.63B for 2022-12-31 TTM and -$3.21B for 2023-12-31 TTM. The most recent observed values are:

  • Operating Cash Flow (TTM) $2.65B
  • Investing Cash Flow (TTM) -$968.0M
  • Financing Cash Flow (TTM) -$3.21B

Understanding Company Strategy

Capital allocation refers to how management decides to spend and invest the company's cash. Analyzing the three primary categories of cash flow reveals a company's true operational strategy:

  • Operating Cash Flow: The engine of the business. This shows how much cash is generated from core operations. Sustainable businesses should ideally fund their growth and shareholder returns primarily from this source.
  • Investing Cash Flow: The future of the business. This includes spending on new equipment, R&D, and acquisitions. Consistent negative values are normal for growing companies as they reinvest in their future.
  • Financing Cash Flow: The funding of the business. This reflects capital raising (issuing stock or debt) versus returning capital to shareholders (dividends and buybacks) or repaying debt.

What to look for: Is the company bootstrapping (funding growth solely from operating cash)? Are they borrowing to fund aggressive expansion or dividends? Or are they capital raising by issuing new shares, potentially diluting your ownership? A healthy, mature company typically generates strong operating cash, moderately invests in growth, and returns the surplus to shareholders through financing activities.

American Airlines Group Inc. (AAL) cash flow allocation analysis. Quarterly chart displaying the three pillars of cash flow: net cash from operating activities, investing activities, and financing activities, providing insight into the company's capital allocation strategy.

Balance Sheet

Book Value per Share

Book Value per Share

Net assets attributable to each share — the accounting floor of intrinsic value

Why Book Value per Share Matters

Book value per share is the net worth of the company — total assets minus total liabilities — divided by shares outstanding (split-adjusted). It represents the theoretical liquidation value per share if every asset were sold and every liability repaid at balance-sheet carrying values. It is the accounting foundation upon which much of equity valuation is built.

A steadily rising book value per share is one of the most reliable signals of compounding wealth creation. It means the company is retaining earnings and building net worth faster than it is returning capital or eroding it. Warren Buffett famously tracked Berkshire Hathaway's book value per share for decades as his primary measure of intrinsic value growth.

Context is essential. Asset-heavy businesses (banks, manufacturers, utilities) should be judged by book value more directly than asset-light businesses (software, consumer brands), where intangible assets like intellectual property and customer loyalty may far exceed their balance-sheet carrying values. A company trading at a large premium to book value is not necessarily overvalued — it may simply possess competitive advantages that accounting rules do not capture. Conversely, a declining book value per share — especially over multiple years — is a serious warning sign of capital destruction.

American Airlines Group Inc. (AAL) book value per share trend showing historical net asset value per share over time, split-adjusted.

Debt to Equity

Debt-to-Equity Ratio

How much of the company is financed by debt versus shareholders' equity

Reading the Debt-to-Equity Ratio

The debt-to-equity (D/E) ratio compares total financial debt to shareholders' equity. A ratio of 1.0 means the company has borrowed one dollar for every dollar of equity; a ratio of 2.0 means it has borrowed twice as much as it owns. Financial leverage amplifies both returns and risk: in good times, debt turbocharges equity returns; in bad times, it accelerates losses and can threaten solvency.

Trends matter more than a single number. A rising D/E ratio can mean the company is taking on debt to fund growth — potentially value-creating if returns exceed the cost of capital. But it can also mean equity is being eroded through losses or that the business is borrowing simply to sustain operations. A falling D/E ratio generally reflects strengthening financial health: earnings are being retained, debt maturities are being paid down, or both.

Industry norms vary enormously. Capital-intensive sectors (utilities, real estate, financials) routinely carry high D/E ratios that would be alarming in, say, a technology company. Always compare against sector peers. As a rough rule of thumb, a D/E above 2× in a cyclical business warrants careful scrutiny of interest coverage and refinancing risk.

American Airlines Group Inc. (AAL) debt-to-equity ratio trend showing the historical balance between financial leverage and shareholders' equity.

Current Ratio

Current Ratio

Short-term liquidity — can the company cover its near-term obligations?

Liquidity: Can the Business Pay Its Bills?

The current ratio is calculated as current assets divided by current liabilities. A ratio of 1.5 means the company has $1.50 of short-term assets — cash, receivables, inventory — for every $1.00 of obligations due within the next twelve months. It is the most direct measure of near-term financial resilience: can the business meet its obligations without needing to raise new capital or sell long-term assets at a discount?

A ratio above 1.0 is generally healthy, meaning current assets exceed current liabilities. A ratio consistently above 2.0 may indicate the company is holding excess cash or inventory that could be deployed more productively. A ratio below 1.0 is a warning sign — the company is relying on future cash generation or external financing to cover its near-term obligations, which is manageable in normal conditions but dangerous during a downturn.

Trends and context matter.A declining current ratio isn't always alarming — highly efficient businesses (e.g., large retailers with reliable daily cash flows) often run leaner balance sheets intentionally. Conversely, a rapidly rising current ratio can signal slowing sales causing inventory to build, or customers taking longer to pay. Always compare the trend against industry peers and cross-reference with the cash flow statement to assess whether the business is genuinely liquid or just holding non-cash current assets.

American Airlines Group Inc. (AAL) current ratio trend showing the ratio of current assets to current liabilities over time, a measure of short-term liquidity.

Valuation

PE Ratio

Price-to-Earnings (PE) Ratio Trend

How much the market is paying for each dollar of company earnings

Price-to-Earnings (PE) Ratio

American Airlines Group Inc.'s trailing twelve-month Price-to-Earnings ratio displays pronounced volatility across the available quarters. Notable inflection points include a high of 70.8x at 2022-12-31 followed by a sharp trough through mid-2023 (5.9x on 2023-03-31, 4.8x on 2023-06-30, 5.6x on 2023-09-30). The P/E then climbed through late 2023 and 2024 (11.5x on 2023-12-31, 21.7x on 2024-03-31, 28.8x on 2024-09-30) before spiking to 97.5x at 2025-12-31.

In the most recent quarter the ratio declined from that peak to 37.5x for the period ending 2026-03-31. Several quarters in the series have no P/E reported in the dataset. The most recent Price-to-Earnings (P/E) ratio for American Airlines Group Inc. was 37.5x.

What Is the PE Ratio?

The Price-to-Earnings (PE) ratio is one of the most widely used valuation metrics in investing. It divides the current stock price by the company's earnings per share (EPS), revealing how much investors are willing to pay for each dollar of earnings. A high PE can signal that the market expects strong future growth, while a low PE may suggest undervaluation—or reflect genuine concerns about the company's prospects.

Context matters:PE ratios vary significantly across industries. High-growth technology companies routinely trade at PE ratios above 30x or 40x, while mature, low-growth sectors like utilities or financials often trade closer to 10–15x. Always compare a company's PE to its own history and its industry peers, not just an absolute number.

What to Look For:

  • Expanding PE (Re-rating):If the PE is rising while earnings are also growing, the market is assigning increasing confidence in the company's future. If PE rises while earnings stagnate, it may signal speculative excess.
  • Contracting PE (De-rating): A falling PE can indicate the market is losing confidence in growth prospects. If earnings grow but the PE shrinks, total returns may be muted.
  • Negative PE: When a company is loss-making, the PE ratio is negative or undefined. In these cases, investors typically use other metrics such as Price-to-Sales (P/S) or EV/EBITDA.
  • Spikes and Troughs: Sudden PE spikes often occur when earnings temporarily collapse (making the divisor small) rather than when the stock price surges. Context is key.

Key Insight:The PE ratio is a snapshot of market sentiment and expectations. Tracking it over time alongside earnings trends reveals whether the market's valuation has expanded or contracted—and whether that change is justified by fundamentals.

American Airlines Group Inc. (AAL) Price-to-Earnings (PE) ratio historical trend analysis. Quarterly chart showing how the market has valued the company's earnings over time.