American Airlines Group Inc. (AAL) shares soared over 5% in pre-market trading on Tuesday, following a confluence of positive developments that boosted investor sentiment towards the airline.
The primary catalyst for the rally was American Airlines' announcement of a renewed multi-year technology partnership with Sabre Corp. (SABR). The deal includes continued use of Sabre's SabreSonic passenger service system and the corporate travel management tool PRISM, ensuring operational efficiency for American Airlines.
Additionally, American Airlines received an upgrade from Bernstein, which raised its rating on the stock to "Outperform" from "Market Perform". Bernstein cited a favorable industry backdrop, better pricing power, lower fuel costs, and a lucrative co-branded credit card deal with Citigroup Inc. (C) as key factors driving the upgrade. The credit card deal is expected to generate substantial cash flow for American Airlines, aiding its deleveraging efforts.
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