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While some cruise line stocks recently surged to new all-time highs, airlines like United Airlines Holdings, Inc. (NASDAQ:UAL) are still stuck with stocks going nowhere. The airline industry survived the Covid lockdowns better than the cruise lines, but the sector remains hated despite massive cash flows and profits. My investment thesis is ultra Bullish on the business heading to new heights and the stock being dragged higher.
Source: Finviz
Profit Machine
No matter what one thinks about the airline sector, the major legacy players have been profit machines going back years before Covid. United Airlines earned an EPS of $12 in 2019 and guided to a midpoint of $12 in 2020 when reporting in January, before the global shutdowns occurred.
The legacy airline just returned in Q4 to an EPS of $10.05 in 2023 and forecast strong earnings again in 2024. Management forecast an EPS of $9 to $11 for a stock currently trading at only $45.
Source: United Airlines Q4’23 investor…
