StockStory Flags Demand and Debt Risks at American Airlines
StockStory points to passenger-mile growth, declining returns and leverage as reasons for caution on the airline.
Key takeaways
- American Airlines reported 68.12 billion revenue passenger miles in its latest quarter, StockStory said.
- StockStory cited $35.73 billion in debt and a 9× net-debt-to-EBITDA ratio.
StockStory warned that American Airlines faces demand and balance-sheet risks, citing passenger-mile growth, declining returns on invested capital and high debt.
The publisher said revenue passenger miles reached 68.12 billion in the latest quarter. Over the previous two years, the measure averaged 9.5% year-on-year growth, which StockStory described as underwhelming.
StockStory also said the airline’s debt was $35.73 billion, compared with $7.77 billion in cash. It cited a net-debt-to-EBITDA ratio of 9 times, based on $2.97 billion of EBITDA over the last 12 months, and argued that weaker profitability could add pressure.
This article was produced with the help of AI technology. Source: Yahoo Finance
