United Airlines (NASDAQ: UAL) stock jumped over 5% in intraday trading Thursday after Citi issued a bullish EPS forecast and raised its price target.
Stephen Trent, the analyst at Citi, gave United Airlines (UAL) a significant vote of confidence by maintaining a Buy rating on the stock and raising its price target from $73.00 to $80.00. This upgrade reflects the firm’s anticipation of a better revenue per available seat mile (RASM) and a slight decrease in the airline’s capital expenditures for 2024. The revised model also incorporates the first-quarter results of 2024.
Citi’s updated financial model reflects a change in earnings per share (EPS) estimates for United Airlines. Citi has adjusted the forecasts for the carrier’s EPS from $10.39 for the current year, $12.09 for the next year, and $14.26 for 2026 to new estimates of $10.68, $13.07, and $15.50, respectively. The firm has incorporated the latest financial data and outlook for these revisions.
Citi’s decision to raise the target price also reflects an increase in the price-to-earnings (P/E) target multiple, rising from 7 times to 7.5 times. With this revised multiple applied to the slightly higher estimated EPS for 2024, the result is an elevated target price for United Airlines’ shares.
United Airlines (NASDAQ: UAL) Stock Movement
At the time of publication, UAL stock has risen to $51.42, showing a 5.50% increase compared to the previous trading session. Traders have exchanged 37,271,742 (37.27 million) shares, surpassing the average daily trading volume of 9.81 million.
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