# American Airlines Group (AAL.US)

Canonical: https://gigainvestors.com/s/AAL

Analysis as of: 2026-10-16T07:26:05.529Z. Financial observations: FY1996–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $12.28 per share; close as of 2026-10-15.

Estimated value: low $14.29 per share, central $14.89 per share, high $15.68 per share. Buy at or below the central value $14.89 per share. Valuation as of 2026-10-16T07:26:05.529Z; scenarios are not confidence intervals.

Expected annual return: 18.4% at the stated quote. About 18.4% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 1 revenue decline in the last 10 years (informational)

- more than 2 net loss years

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 1

- Years with a net loss: 3

- Operating margin variation: 8.58×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.10×

- FY2018: 0.06×

- FY2019: 0.07×

- FY2020: -0.60×

- FY2021: -0.04×

- FY2022: 0.03×

- FY2023: 0.06×

- FY2024: 0.05×

- FY2025: 0.03×

- LTM to Jun 2026: 0.02×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 6.2%

- ROIC, second-lowest year: -3.7%

- Typical minus recent gross margin: 0.1 pp

- Typical gross margin (annual median): 21.1%

- Recent gross margin (lower of latest and 3-year median): 21.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 7.0%

- ROIC including acquisitions, ten-year median: 0.5%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: 18.2%

- FY2018: 8.0%

- FY2019: 9.0%

- FY2020: -35.5%

- FY2021: -3.7%

- FY2022: 4.4%

- FY2023: 9.4%

- FY2024: 8.5%

- FY2025: 4.4%

- LTM to Jun 2026: 4.0%

### economics: fail

- incremental invested capital return below threshold

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $591M

- Net income, five-year total: -$87M

- Return on incremental invested capital: -36.7%

- Working capital / revenue, annual change: 0.1 pp

- Working capital / revenue, change between three-year averages: 0.8 pp

- Working capital / revenue, final three-year average: 3.9%

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: $134M

- FY2022: $127M

- FY2023: $822M

- FY2024: $846M

- FY2025: -$1.3B

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 18.2% vs 8.5%

- Per-share earnings: 4.65 to 1.14 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.4%

- Ordinary dilution, 5-year annual growth: 6.4%

- Market cap gain: -$14B

- Cumulative retained earnings: -$8.4B

- Diluted shares, 10-year annual growth: -0.4%

- Diluted shares, 5-year annual growth: 6.4%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -16.1%

- Per-share value change: -$3.50

- Per-share value, starting three-year median: $4.65

- Per-share value, ending three-year median: $1.14

- Buybacks concentrated in cheaper years (correlation): 0.82

- Average buyback yield: 6.0%

- Buyback history: 7 years

- Debt-funded buybacks: Yes

- Acquisition spending: $123M

- Cumulative net income, 10 years: -$2.0B

- ROIC, first three-year median: 18.2%

- ROIC, last three-year median: 8.5%

Chart: Earnings per share; fiscal year observations.

- FY2016: $4.65

- FY2017: $2.61

- FY2018: $3.03

- FY2019: $3.79

- FY2020: -$18.36

- FY2021: -$3.09

- FY2022: $0.19

- FY2023: $1.14

- FY2024: $1.17

- FY2025: $0.17

### accounting: pass

- Sloan accruals: -4.8%

- Receivables to sales index (DSRI): 1.03×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 1.8%

- Earnings backed by cash: Yes

- Operating cash / earnings: 27.92×

- Accounting red flags: 0

Chart: Sloan accruals; fiscal year observations.

- FY2016: -7.7%

- FY2017: -6.6%

- FY2018: -3.5%

- FY2019: -3.5%

- FY2020: -3.8%

- FY2021: -4.1%

- FY2022: -3.2%

- FY2023: -4.7%

- FY2024: -5.1%

- FY2025: -4.8%

## Holders

- [David Tepper](https://gigainvestors.com/AM): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Harry Burn](https://gigainvestors.com/SSHFX): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 36% since Oct 2021 · "American Airlines Group (AAL) Is Down 13.1% After Record Revenue But Weaker Profit Outlook" (finance.yahoo.com, Jul 2026) · sales +6.8%

Story as of 2026-10-16T09:58:12.317Z; price observation 2026-10-15.

Price needs cash profits to shrink 8.7% a year for ten years

- 2025-05-12: AAL Q1 Earnings Call: Revenue in Line, Cost Pressures and Uncertain Demand Cloud Outlook ([finance.yahoo.com](https://finance.yahoo.com/news/aal-q1-earnings-call-revenue-102945575.html))

- 2025-08-13: American Airlines (AAL) Flies 12% Higher on Lower Fuel Price, Airfare Jump ([finance.yahoo.com](https://finance.yahoo.com/news/american-airlines-aal-flies-12-165424772.html))

- 2025-10-23: AAL Incurs Narrower-Than-Expected Q3 Loss, Expects Profitability in Q4 ([finance.yahoo.com](https://finance.yahoo.com/news/aal-incurs-narrower-expected-q3-151500358.html))

- 2026-03-25: How Fuel Inflation Forced a Reset in Wall Street’s View of American Airlines (AAL) ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/fuel-inflation-forced-reset-wall-195622156.html))

- 2026-05-26: American Airlines stock jumps as the airline picks Starlink for in-flight Wi-Fi service ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/article/american-airlines-stock-jumps-as-the-airline-picks-starlink-for-in-flight-wi-fi-service-170454812.html))

- 2026-07-24: American Airlines Group (AAL) Is Down 13.1% After Record Revenue But Weaker Profit Outlook ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/american-airlines-group-aal-down-141453063.html))

### Sales · FY2025–2026

sales +6.8%; source https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm; observed 2026-02-18.

- FY2017: $43B 

- FY2018: $45B 

- FY2019: $46B 

- FY2020: $17B 

- FY2021: $30B 

- FY2022: $49B 

- FY2023: $53B 

- FY2024: $54B 

- FY2025: $55B 

- FY2026: $58B 

### Gross margin · FY2026

gross margin 21%; source https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm; observed 2026-02-18.

- FY2017: 26.6% 

- FY2018: 22.6% 

- FY2019: 24.3% 

- FY2021: 0.1% 

- FY2022: 18.5% 

- FY2023: 22.4% 

- FY2024: 21.1% 

- FY2025: 19.2% 

- FY2026: 21.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in airlines; annual sales are USD 54.6 billion.

- Source: https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm (filed 2026-02-18); FY2025: revenue 54633000000; grossProfit 10471000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AAL.US: American Airlines Group Inc., through its subsidiaries, operates as a network air carrier in the United States, Latin America, Atlantic, and Pacific. The company provides scheduled air transportation services for passengers and cargo through its hubs in Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York, Philadelphia, Phoenix, and Washington, D.C., as well as through partner gateways in London, Doha, Madrid, Seattle/Tacoma, Sydney, and Tokyo. It also operates a mainline fleet of 1,013 aircraft. The company was formerly known as AMR Corporation and changed its name to American Airlines Group Inc. in December 2013. American Airlines Group Inc. was founded in 1926 and is headquartered in Fort Worth, Texas.

### Why customers stay

Margins ranged from 19.2% to 22.4% during 2023–25; it earns 6.2% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2023: grossProfit / revenue = 22.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2024: grossProfit / revenue = 21.1%.

- Source: https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm (filed 2026-02-18); FY2025: grossProfit / revenue = 19.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); 10-year return on capital observations [[2017,0.18179204124801693],[2018,0.07959495515796904],[2019,0.09014909694420556],[2020,-0.3548683132893659],[2021,-0.03749092538651132],[2022,0.04418704446569117],[2023,0.09350844398105017],[2024,0.08520048414672222],[2025,0.0441846995041935],[2026,0.04002412545235223]]; median 0.061890999811830105. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 7 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2018: growth capex 1443458212.8368006; upkeep 2301541787.1631994; owner earnings 1267458212.8368006. Growth capex / owner earnings = 1.1388605937596004.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2019: growth capex 1024603085.0879946; upkeep 3243396914.9120054; owner earnings 760603085.0879946. Growth capex / owner earnings = 1.34709299130631.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2021: growth capex 0; upkeep 208000000; owner earnings 134000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2022: growth capex 929000000; upkeep 1977000000; owner earnings 127000000. Growth capex / owner earnings = 7.31496062992126.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2023: growth capex 660000000; upkeep 1936000000; owner earnings 822000000. Growth capex / owner earnings = 0.8029197080291971.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); FY2024: growth capex 757000000; upkeep 1926000000; owner earnings 846000000. Growth capex / owner earnings = 0.8947990543735225.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); Dividend observations: [[2016,224000000],[2017,198000000],[2018,186000000],[2019,178000000],[2020,43000000],[2021,12190000000],[2022,3549000000],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 1.5% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); AAL.US SharesStats.PercentInsiders = 1.514 percentage points; cache date 2026-10-16.

### What could break it

US import tariffs could raise product costs.

- Source: https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm (filed 2026-02-18); ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

2025 Financial Overview

Business and Macroeconomic Conditions

Starting in the first quarter of 2025, the U.S. Government has promoted and implemented plans to place additional tariffs on goods imported into the U.S. from numerous countries and has pursued other trade policies intended to restrict imports and, in response, multiple nations have countered with reciprocal tariffs and other actions.

These or additional changes in U.S. or international trade policies, along with continued uncertainty surrounding such policies, could lead to further weakened business conditions for the transportation industry, which may adversely impact our operations through increased supply chain challenges, commodity price volatility and a decline in discretionary spending and consumer confidence, among others. We continue to monitor the situation.

Many aspects of our airline operations depend on the U.S. Government, and in the fourth quarter of 2025, the prolonged government shutdown led to mandated schedule reductions, strained air traffic control and security screening resources, reduced air traffic capacity at key U.S. airports, and increased delays and cancellations. Additionally, the government shutdown-related uncertainty temporarily impacted customer bookings in the fourth quarter of 2025 and negatively impacted our revenue by approximately $325 million.

AAG’s 2025 Financial Results

The selected financial data presented below is derived from AAG’s audited consolidated financial statements included in Part II, Item 8A of this report and should be read in conjunction with those financial statements and the related notes thereto.

Year Ended December 31, Increase

(Decrease) Percent

Increase

(Decrease)

2025 2024

(In millions, except percentage changes)

Passenger revenue $ 49,643 $ 49,586 $ 57 0.1

Cargo revenue 839 804 35 4.3

Other operating revenue 4,151 3,821 330 8.7

Total operating revenues 54,633 54,211 422 0.8

Aircraft fuel and related taxes 10,718 11,418 (700) (6.1)

Salaries, wages and benefits 17,566 16,021 1,545 9.6

Total operating expenses 53,166 51,597 1,569 3.0

Operating income 1,467 2,614 (1,147) (43.9)

Pre-tax income 190 1,154 (964) (83.6)

Income tax provision 79 308 (229) (74.7)

Net income 111 846 (735) (86.8)

Pre-tax income – GAAP $ 190 $ 1,154 $ (964) (83.6)

Adjusted for: pre-tax net special items (1)

162 667 (505) (75.7)

Pre-tax income excluding net special items $ 352 $ 1,821 $ (1,469) (80.7)

(1)See Part II

### What the price says

The price assumes cash profits shrink 8.7% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-18); Ten-year compound average after fade. Initial solved rate -0.13409300686103592. Price 12.28; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 4.463486844498112 → FY2025 -2.0246850781837287. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $40.60 per share

- 2016-11: $46.44 per share

- 2016-12: $46.69 per share

- 2017-01: $44.25 per share

- 2017-02: $46.36 per share

- 2017-03: $42.30 per share

- 2017-04: $42.62 per share

- 2017-05: $48.41 per share

- 2017-06: $50.32 per share

- 2017-07: $50.44 per share

- 2017-08: $44.74 per share

- 2017-09: $47.49 per share

- 2017-10: $46.82 per share

- 2017-11: $50.49 per share

- 2017-12: $52.03 per share

- 2018-01: $54.32 per share

- 2018-02: $54.25 per share

- 2018-03: $51.96 per share

- 2018-04: $42.93 per share

- 2018-05: $43.54 per share

- 2018-06: $37.96 per share

- 2018-07: $39.54 per share

- 2018-08: $40.48 per share

- 2018-09: $41.33 per share

- 2018-10: $35.08 per share

- 2018-11: $40.16 per share

- 2018-12: $32.11 per share

- 2019-01: $35.77 per share

- 2019-02: $35.63 per share

- 2019-03: $31.76 per share

- 2019-04: $34.18 per share

- 2019-05: $27.23 per share

- 2019-06: $32.61 per share

- 2019-07: $30.51 per share

- 2019-08: $26.31 per share

- 2019-09: $26.97 per share

- 2019-10: $30.06 per share

- 2019-11: $28.74 per share

- 2019-12: $28.68 per share

- 2020-01: $26.84 per share

- 2020-02: $19.05 per share

- 2020-03: $12.19 per share

- 2020-04: $12.01 per share

- 2020-05: $10.50 per share

- 2020-06: $13.07 per share

- 2020-07: $11.12 per share

- 2020-08: $13.05 per share

- 2020-09: $12.29 per share

- 2020-10: $11.28 per share

- 2020-11: $14.13 per share

- 2020-12: $15.77 per share

- 2021-01: $17.17 per share

- 2021-02: $20.94 per share

- 2021-03: $23.90 per share

- 2021-04: $21.72 per share

- 2021-05: $24.24 per share

- 2021-06: $21.21 per share

- 2021-07: $20.38 per share

- 2021-08: $19.94 per share

- 2021-09: $20.52 per share

- 2021-10: $19.20 per share

- 2021-11: $17.69 per share

- 2021-12: $17.96 per share

- 2022-01: $16.47 per share

- 2022-02: $17.25 per share

- 2022-03: $18.25 per share

- 2022-04: $18.77 per share

- 2022-05: $17.87 per share

- 2022-06: $12.68 per share

- 2022-07: $13.71 per share

- 2022-08: $12.99 per share

- 2022-09: $12.04 per share

- 2022-10: $14.18 per share

- 2022-11: $14.43 per share

- 2022-12: $12.72 per share

- 2023-01: $16.14 per share

- 2023-02: $15.98 per share

- 2023-03: $14.75 per share

- 2023-04: $13.64 per share

- 2023-05: $14.78 per share

- 2023-06: $17.94 per share

- 2023-07: $16.75 per share

- 2023-08: $14.73 per share

- 2023-09: $12.81 per share

- 2023-10: $11.15 per share

- 2023-11: $12.43 per share

- 2023-12: $13.74 per share

- 2024-01: $14.23 per share

- 2024-02: $15.68 per share

- 2024-03: $15.35 per share

- 2024-04: $13.51 per share

- 2024-05: $11.50 per share

- 2024-06: $11.33 per share

- 2024-07: $10.64 per share

- 2024-08: $10.62 per share

- 2024-09: $11.24 per share

- 2024-10: $13.40 per share

- 2024-11: $14.52 per share

- 2024-12: $17.43 per share

- 2025-01: $16.92 per share

- 2025-02: $14.35 per share

- 2025-03: $10.55 per share

- 2025-04: $9.95 per share

- 2025-05: $11.41 per share

- 2025-06: $11.22 per share

- 2025-07: $11.49 per share

- 2025-08: $13.37 per share

- 2025-09: $11.24 per share

- 2025-10: $13.13 per share

- 2025-11: $14.05 per share

- 2025-12: $15.33 per share

- 2026-01: $13.30 per share

- 2026-02: $13.07 per share

- 2026-03: $10.74 per share

- 2026-04: $11.71 per share

- 2026-05: $14.64 per share

- 2026-06: $18.07 per share

- 2026-07: $15.27 per share

- 2026-08: $13.43 per share

- 2026-09: $13.37 per share

- 2026-10: $12.50 per share

## Annual estimated value (USD per share)

- FY2018: low $38.06 per share, central $42.16 per share, high $47.62 per share

- FY2019: low $25.26 per share, central $27.84 per share, high $31.28 per share

- FY2021: low $20.65 per share, central $20.96 per share, high $21.38 per share

- FY2022: low $15.85 per share, central $16.36 per share, high $17.03 per share

- FY2023: low $12.66 per share, central $13.15 per share, high $13.81 per share

- FY2024: low $11.86 per share, central $12.37 per share, high $13.05 per share

- FY2025: low $12.34 per share, central $12.90 per share, high $13.64 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/6201/000000620126000014/aal-20251231.htm); period 2025-12-31, filed 2026-02-18.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.