United Airlines Holdings Inc: Solid Print; Conservative Guidance Leaves Room for Upside

研报英文原文证据摘录

United Airlines Holdings Inc: Solid Print; Conservative Guidance Leaves Room for Upside

Forecast returns

Forecast price appreciation 28.8%

Forecast dividend yield 0.0%

Forecast stock return 28.8%

Market return assumption 9.1%

Forecast excess return 19.6%

Company Description

United Airlines Holdings, Inc., through its subsidiaries, provides air transportation services in

North America, Asia, Europe, Africa, the Pacific, the Middle East, and Latin America. The

company transports people and cargo through its mainline and regional fleets. It also offers

catering, ground handling, flight academy, and maintenance services for third parties. The

company was formerly known as United Continental Holdings, Inc. and changed its name to

United Airlines Holdings, Inc. in June 2019. United Airlines Holdings, Inc. was incorporated in

1968 and is headquartered in Chicago, IL.

Valuation Method and Risk Statement

Valuation: We use an P/E multiple to determine our price target for UAL. Our price target is

based on multiples analysis. We take into account where the stock is currently trading at vs. its

historical average as well as relative to peers.

Risk statement: Airlines are highly dependent on consumer leisure and business travel

spending both of which provide minimum visibility. Taken with fuel price volatility, high labor

costs and large capital expenditures, the company's earnings and cash flow can swing

meaningfully. Additionally, competitive dynamics can also weigh on profitability as airlines

looks to fend off existing competitors as well as new comers which often bring some form of

new competitive operating model (LCCs initially and now ULCCs). Although, airlines are

generally better positioned today vs. history given the consolidated nature of the industry and