United Airlines Earnings: Strong 2024 Results and 2025 Outlook
We’ve raised our fair value estimate of United stock.
Key Morningstar Metrics for United Airlines Holdings
- Fair Value Estimate: $39.00
- Morningstar Rating: ★
- Morningstar Economic Moat Rating: None
- Morningstar Uncertainty Rating: High
What We Thought of United Airlines Holdings’ Earnings
United Airlines Holdings UAL booked a $1.5 billion operating profit on $14.7 billion of revenue in the final quarter of 2024, topping a 10% margin due to strong demand in the winter holiday travel rush and a 19% dip in quarterly fuel costs compared with 2023.
Why it matters: Airlines don’t usually have as good operating margins in the final quarter of the year compared with the peak summer quarters, but a dip in fuel costs buoyed United’s profitability in late 2024. Every other major operating expense at the global airline grew by double-digit percentages.
The bottom line: We have raised our fair value estimate for the no-moat-rated airline from $36 per share to $39, mostly due to its expanded near-term profit margin. We continue to see the stock as meaningfully overvalued and believe investors overestimate the durability and repeatability of recent results.
Coming up: We anticipate some further cost growth to offset cheaper fuel in 2025, since the firm anticipates higher costs from a renewed labor agreement with flight attendants sometime soon.
United Airlines Holdings Stock vs. Morningstar Fair Value Estimate
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