Are Smart Investors Making the Right Decision? United Airlines Holdings Inc. (UAL)

United Airlines Holdings Inc. (NASDAQ: UAL) stock jumped 0.04% on Tuesday to $49.30 against a previous-day closing price of $49.28. With 5.4 million shares changed hands, the volume of the stock remained lighter than its average volume of 8.69 million shares. During the session, the Airlines company that operates in wider Industrials sector, reached to the highest price of $50.28 whereas the lowest price it dropped to was $48.87. The 52-week range on UAL shows that it touched its highest point at $53.26 and its lowest point at $30.54 during that stretch. It currently has a 1-year price target of $55.76. Beta for the stock currently stands at 1.39.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of UAL was down-trending over the past week, with a drop of -3.71%, but this was up by 26.41% over a month. Three-month performance surged to 21.91% while six-month performance rose 35.66%. The stock gained 18.37% in the past year, while it has gained 30.77% so far this year. A look at the trailing 12-month EPS for UAL yields 2.17 with Next year EPS estimates of 9.52. For the next quarter, that number is 0.79. This implies an EPS growth rate of 75.90% for this year and 22.21% for next year.

Float and Shares Shorts:

At present, 326.80 million UAL shares are outstanding with a float of 325.89 million shares on hand for trading. On Oct 13, 2022, short shares totaled 15.45 million, which was 4.72% higher than short shares on Sep 14, 2022. In addition to Mr. J. Scott Kirby as the firm’s CEO & Director, Mr. Brett J. Hart serves as its Pres.


Institutional Ownership:

Through their ownership of 63.00% of UAL’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 5.78% of UAL, in contrast to 37.69% held by mutual funds. Shares owned by individuals account for 22.69%. As the largest shareholder in UAL with 10.66% of the stake, The Vanguard Group, Inc. holds 34,860,537 shares worth 34,860,537. A second-largest stockholder of UAL, PRIMECAP Management Co., holds 24,482,858 shares, controlling over 7.49% of the firm’s shares. BlackRock Fund Advisors is the third largest shareholder in UAL, holding 14,197,340 shares or 4.34% stake. With a 3.79% stake in UAL, the Vanguard PRIMECAP Fund is the largest stakeholder. A total of 12,391,583 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 3.03% of UAL stock, is the second-largest Mutual Fund holder. It holds 9,919,904 shares valued at 373.98 million. Vanguard Mid Cap Index Fund holds 2.32% of the stake in UAL, owning 7,597,457 shares worth 286.42 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for UAL since 22 analysts follow the stock currently. There are 10 analysts who recommend BUY ratings, while 2 suggest SELL ratings. Of the remaining analysts, 7 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 1 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With UAL analysts setting a high price target of $81.00 and a low target of $36.00, the average target price over the next 12 months is $56.59. Based on these targets, UAL could surge 64.3% to reach the target high and fall by -26.98% to reach the target low. Reaching the average price target will result in a growth of 14.79% from current levels.


EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. UAL will report FY 2023 earnings on 01/16/2024. Analysts have provided yearly estimates in a range of $10.90 being high and $4.24 being low. For UAL, this leads to a yearly average estimate of $7.81. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. United Airlines Holdings Inc. surprised analysts by $0.35 when it reported $2.46 EPS against a consensus estimate of $2.11. The surprise factor in the prior quarter was $0.53. Based on analyst estimates, the high estimate for the next quarter is $0.98 and the low estimate is $0.30. The average estimate for the next quarter is thus $0.69.

Summary of Insider Activity:

Insiders traded UAL stock several times over the past three months with 3 Buys and 0 Sells. In these transactions, 30,000 shares were bought while 0 shares were sold. The number of buy transactions has increased to 77 while that of sell transactions has risen to 42 over the past year. The total number of shares bought during that period was 1,024,798 while 403,921 shares were sold.

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