Monthly Scorecard: perfect storm of low capacity, falling fuel, strong demand

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Monthly Scorecard: perfect storm of low capacity, falling fuel, strong demand

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Airlines

Monthly Scorecard: perfect storm of low

capacity, falling fuel, strong demand

Price Objective Change

A look at Airline supply, demand, valuations, and returns 22 June 2026

As 2Q26 earnings approach, the fundamental backdrop for airlines has improved over Equity

the past several weeks. Brent is down 28% over the past month, domestic capacity United States

growth is now flattish from June through September, and real-time demand indicators Airlines

remain firm through mid-June. Airline equities have responded, rallying 26% over the Andrew G. Didora, CFA

same period with broad-based strength across the group. With pricing strength driven by Research Analyst

strong demand and airlines pricing through higher fuel, the key question is how much of BofAS+1 646 855 2924

that pricing can be retained as fuel declines. We believe the answer will ultimately andrew.didora@bofa.com

depend on capacity discipline, particularly whether lower fuel costs result in incremental John Gellene, CFA

Research Analyst

supply post-summer. Given strong demand and market performance, we raise our price BofAS

objectives on Buy-rated DAL ($93 from $78), Buy-rated UAL ($145 from $140), and +1 646 855 5193

john.gellene@bofa.com

Neutral-rated AAL ($16 from $14) on slightly higher multiples (see Exhibit 1).

Inside we present a monthly scorecard, charts, and tables of Airline industry key supply and

Recent research reportsdemand metrics, valuations, and recent market returns. See Page 3 for real-time indicators.

Latest BofA Seat Tracker

Pricing indicators continue to accelerate

Leisure: Leisure spend slows to flat,Pricing momentum has continued to build, with indicators accelerating both year-over-