While United Airlines Holdings Inc.’s UAL guidance came in line with expectations, its cost commentary for 2022 is a key differentiator, according to BofA Securities.
The United Airlines Holdings Analyst: Andrew Didora maintained an Underperform rating for United Airlines Holdings while keeping the price target unchanged at $40.
The United Airlines Holdings Thesis: The company reiterated its 2022 unit cost goal of being below the 2019 levels, which is the key differentiator, Didora said in the note to clients.
Delta Air Lines, Inc DAL pushed this goal to the back half of 2022, “increasing concerns that other airlines would be unable to hit this milestone,” the analyst wrote.
“UAL appears bullish on an international demand recovery as the airline plans 2022 international capacity to be up +10% vs. 2019. This plan seems aggressive, especially given expectations for the international recovery to be slower than the US, but UAL does have more widebody aircraft today than at the end of 2019 given deliveries in the pandemic coupled with zero retirements,” Didora said,
“With cost pressures across most airline operating cost items, this international growth is likely the driver of the cost plan,” he added.
UAL Price Action: Shares of United Airlines Holdings had declined by 0.58% to $45.95 at the time of publication Wednesday.
Photo: United Airlines
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