Evercore ISI has reiterated an In Line rating and maintained a $17.00 price target on American Airlines Group Inc. (NASDAQ:AAL) after the company released fourth-quarter 2025 financial results. The stock traded at $13.55 and had declined more than 10.5% over the prior week, while analyst price targets cited in reports span a range from $11 to $21. InvestingPro data indicates the shares are trading close to the platform's Fair Value estimate.
American reported a fourth-quarter pre-tax margin of 1%, down from 6% in the same quarter of 2024. The quarter saw unit revenue decline 2% year-over-year while total unit costs rose 4%, compressing operating profitability. On a per-share basis the company posted adjusted EPS of $0.16, below Evercore's internal projection of $0.20 and beneath the broader Street consensus cited at $0.36. Over the last twelve months the carrier was profitable on a diluted EPS basis, reporting $0.90, though InvestingPro data flagged an expectation for net income to fall in the current year.
Management and analysts identified the recent federal government shutdown as a meaningful headwind to results. American said the disruption trimmed approximately $325 million from revenue in the period; absent that event, the firm's total revenue growth for the quarter would have been roughly 5%, rather than the reported 2.5%.
On a trailing-twelve-month basis the company generated $54.29 billion in revenue and $4.61 billion of EBITDA. These figures provide context for the profitability and cash-flow profile referenced in quarterly commentary and analyst notes.
Looking to the first quarter of 2026, American projects revenue growth of 7-10% with capacity rising 3-5%. Management provided a first-quarter loss-per-share outlook in a range of $0.10 to $0.50 per share, a midpoint that aligns with Evercore's prior estimate of a $0.31 loss for the period. Investors are also being asked to monitor the company's liquidity metrics; American's current ratio stood at 0.54, indicating short-term liabilities exceed liquid assets as it heads into Q1.
For full-year 2026 the carrier issued earnings guidance of $1.70 to $2.70 per share, a range that is above both Evercore's previous forecasts and the broader Wall Street estimates referenced in analyst coverage. In response to that guidance, Evercore raised its fiscal 2026 EPS estimate to $2.00 from $1.80. At the reported market capitalization of $8.95 billion and a PEG ratio of 0.14, analysts noted valuation metrics that could be viewed as inexpensive relative to prospective growth assumptions.
In separate market reporting of the quarter's results, American's adjusted EPS figure of $0.16 represented a 57.89% negative surprise versus an expected $0.38. Revenue for the quarter came in at $14.00 billion, marginally below the consensus projection of $14.04 billion. Following the release, the stock registered a modest pre-market uptick. There were no reported mergers, acquisitions, analyst upgrades or downgrades accompanying the earnings disclosure.
Key points
- Evercore ISI maintained an In Line rating and a $17.00 price target on American Airlines after Q4 2025 results; the stock was trading near InvestingPro's Fair Value estimate.
- Q4 showed a sharp decline in pre-tax margin to 1% from 6% a year earlier, driven by a 2% drop in unit revenue and a 4% rise in unit costs; adjusted EPS of $0.16 missed analyst expectations.
- Guidance calls for Q1 2026 revenue growth of 7-10% with capacity up 3-5%, and full-year 2026 EPS guidance of $1.70-2.70, leading Evercore to raise its FY2026 EPS estimate to $2.00 from $1.80.
Risks and uncertainties
- Operational and macro shocks - The government shutdown reduced quarter revenue by roughly $325 million, illustrating sensitivity to external disruptions that can materially alter near-term top-line results. (Impacted sectors: Airlines, Travel)
- Liquidity and short-term obligations - A current ratio of 0.54 signals that current liabilities exceed liquid assets, a balance-sheet consideration that bears watching as the company moves through a projected first-quarter loss season. (Impacted sectors: Financials, Airlines)
- Earnings execution - The company missed consensus EPS and revenue forecasts for Q4 2025, creating uncertainty around near-term earnings momentum and market expectations. (Impacted sectors: Markets, Investment analysts)
These developments will be relevant to investors monitoring airline and travel-sector fundamentals, as well as those assessing valuation versus expected earnings recovery in 2026. For stakeholders, the items to track next include actual Q1 revenue and capacity execution, progress toward the full-year outlook, and any further liquidity developments.