The security received an upgrade, as well as two price-target cuts
The shares of American Airlines Group Inc (NASDAQ:AAL) are up 3.2% to trade at $20.72 this morning, after the security received an upgrade from Raymond James to "market perform" from "underperform." The firm highlighted the airliner's risk-reward profile, which has become more balanced since the latest market selloff. Meanwhile, both J.P. Morgan Securities and Stifel cut their price objectives to $14 and $19, respectively.
Though the security has been descending from a March 18, annual high of $26.09, the supportive 80-day moving average has recently stepped in as a landing pad, containing this pullback. American Airlines stock is now attempting to overcome overhead pressure at the $21.50 mark, and sports an impressive 103.4% year-over-year lead.
Analysts were pessimistic towards the equity coming into today, with 12 of the 13 in question carrying a tepid "hold" or worse rating, while only one said "strong buy." Plus, the 12-month consensus price target of $17.69 is a 15.2% discount to current levels.
A short squeeze could create additional tailwinds for American Airlines stock going forward. Short interest added 6.7% in the most recent reporting period, and the 78.77 million shares sold short make up a whopping 17.7% of the security's available float.
Lastly, now could be the right opportunity to weigh in on AAL's next move with options. The security's Schaeffer's Volatility Index (SVI) of 46% sits at the bottom percentile of its annual range. To put it simply, the equity currently sports affordably priced premiums.