American Airlines Group (AAL) is back in the spotlight after Appaloosa Management, the hedge fund founded by David Tepper and Jack Walton, took a new position in the airline. According to Appaloosa’s latest 13F filing, the firm purchased 7.5 million shares of American Airlines during the second quarter of 2026, signaling renewed interest in a stock that has had a turbulent ride so far this year.
American Airlines has continued to see strong demand, posting record-breaking revenue in its latest quarterly report, but that momentum has been overshadowed by a sharp squeeze on profits. Soaring global jet fuel prices, combined with broader macroeconomic pressures, have weighed heavily on the company’s bottom line and kept the stock volatile throughout 2026.
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While American Airlines has managed to push fares higher to offset some of the fuel-cost pressure, persistently elevated fuel prices remain a major obstacle for the company and the broader airline industry. That makes Appaloosa’s new position particularly notable and could signal that the hedge fund sees value in AAL despite the near-term challenges. So here’s a closer look at AAL stock and the conditions that could shape its next move.
About American Airlines Stock
American Airlines is a major global carrier connecting the United States with destinations around the world. Its roots date back to 1926, when it began as an air mail carrier in the Midwestern U.S. Today, American Airlines operates more than 6,000 daily flights to over 350 destinations across more than 60 countries, serving more than 200 million customers each year. Its operations are supported by a workforce of approximately 130,000 aviation professionals.
In 2026, American Airlines is marking its centennial year, a milestone that reflects a century of changes and innovation across the airline industry. Over the decades, the company introduced the first scheduled air cargo service, the first airport lounge and the first airline loyalty program, while continuing to evolve its customer experience. American Airlines is also a founding member of the oneworld alliance, whose member airlines collectively serve more than 900 destinations worldwide.
With a market capitalization of $9.55 billion, American Airlines stock has had a bumpy ride and continues to lag the broader market. AAL has managed a modest 7.33% gain over the past year, but the stock is down 7.8% so far in 2026. By comparison, the S&P 500 Index ($SPX) has climbed an impressive 19.44% over the past year and gained another 12.5% in 2026. The recent pullback has been even sharper. American Airlines shares reached a 52-week high of $18.79 in early July but have since fallen 25.1% from that peak.
www.barchart.com Inside American Airlines’ Q2 Earnings Report
American Airlines delivered a quarter that looked impressive on the surface but became much harder to digest once costs came into focus. In its fiscal 2026 second-quarter earnings report released on July 23, American Airlines posted a record $16.74 billion in revenue, up 16.3% year-over-year (YOY) and marking the highest quarterly revenue in the airline’s history. The strong top-line performance reflected solid demand across all four of American Airlines’ commercial pillars and came in slightly above Wall Street’s $16.71 billion consensus estimate.
A closer look at the numbers shows that strong demand remained. Premium travel continued to lead the way, with passenger unit revenue rising 13.4% YOY, while Main Cabin passenger unit revenue increased 8.8%. Domestic demand also rebounded strongly, with passenger unit revenue climbing 10.6%. International operations delivered another bright spot, with passenger unit revenue increasing 8.9% in the Atlantic, 15.1% in the Pacific and 6.6% in Latin America.
Business travel was particularly resilient, with American Airlines’ managed corporate revenue jumping 26% from a year earlier. But there was a major catch. Higher revenue did not translate into stronger profits. American Airlines’ fuel expense surged by more than $2.2 billion, or 83%, YOY, creating a significant drag on earnings. The airline managed to offset nearly half of that fuel-cost headwind through higher fares and strong demand, but the remaining pressure still hit the bottom line hard.
GAAP EPS plunged to $0.11 from $0.91 in the year-ago quarter, while adjusted EPS fell to $0.15 from $0.95. Still, the adjusted figure comfortably beat Wall Street’s $0.05 consensus estimate. American Airlines also ended the quarter with $11.3 billion in total available liquidity, giving the carrier a stronger financial cushion as it navigates elevated costs and a challenging operating environment.
However, investors were far less impressed by the headline revenue growth. American Airlines shares fell 8.35% following the earnings release, as attention quickly shifted toward the company’s cautious third-quarter outlook. American Airlines expects Q3 adjusted EPS to range from a loss of $0.70 to a loss of $0.10, significantly below Wall Street expectations, even as revenue is projected to rise 16% to 19% year over year.
How Do Analysts View American Airlines Stock?
Wall Street remains largely bullish on American Airlines, with AAL carrying a consensus “Moderate Buy” rating. Of the 24 analysts covering the stock, 12 recommend a “Strong Buy,” 11 favor a “Moderate Buy,” and just one rates it a “Strong Sell.” The optimism is reflected in the price targets, too. The $18.93 average target implies 34.5% upside, while the Street-high target of $25 points to a potential 77.7% gain from current levels.
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www.barchart.com On the date of publication, Anushka Mukherji did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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