Zacks Investment Research Downgrades United Continental (UAL) to Hold
United Continental (NYSE:UAL) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a report issued on Monday.
According to Zacks, “United Continental’s fourth-quarter 2017 earnings (on an adjusted basis) of $1.40 per share surpassed the Zacks Consensus Estimate by 6 cents. However, the bottom line declined 21.4% on a year-over-year basis due to higher costs.Operating revenues of $9, 438 million were marginally ahead of the Zacks Consensus Estimate of $9,427.9 million. The top line also increased 4.3% on a year-over-year basis. Strong demand for air travel aided the top line. The company also recorded PRASM growth in the quarter. The company expects consolidated PRASM growth in the band of 0% to 2% (year over year) for the first quarter of 2018. Apart from high costs, we are concerned about the capacity overexpansion at United Continental. In fact, shares of the company have underperformed its industry over the past year. “
UAL has been the subject of a number of other research reports. Imperial Capital cut their price objective on shares of United Continental from $63.00 to $57.00 and set an “in-line” rating for the company in a research report on Friday, October 20th. Buckingham Research upped their price objective on shares of United Continental from $83.00 to $88.00 and gave the company a “buy” rating in a research report on Wednesday, January 24th. Evercore ISI lowered shares of United Continental from an “outperform” rating to an “in-line” rating in a research report on Wednesday, January 24th. TheStreet raised shares of United Continental from a “c+” rating to a “b” rating in a research report on Thursday, December 7th. Finally, ValuEngine raised shares of United Continental from a “buy” rating to a “strong-buy” rating in a research report on Friday, December 1st. Two equities research analysts have rated the stock with a sell rating, eight have issued a hold rating and eleven have issued a buy rating to the company’s stock. United Continental currently has an average rating of “Hold” and an average price target of $82.87.
United Continental (NYSE:UAL) last announced its quarterly earnings data on Tuesday, January 23rd. The transportation company reported $1.40 EPS for the quarter, beating the Zacks’ consensus estimate of $0.95 by $0.45. The business had revenue of $9.44 billion during the quarter, compared to analyst estimates of $9.41 billion. United Continental had a net margin of 5.65% and a return on equity of 23.43%. The firm’s revenue for the quarter was up 4.3% on a year-over-year basis. During the same quarter in the prior year, the business earned $1.78 earnings per share. sell-side analysts forecast that United Continental will post 7.43 EPS for the current fiscal year.
United Continental announced that its board has authorized a share buyback plan on Thursday, December 7th that allows the company to repurchase $3.00 billion in outstanding shares. This repurchase authorization allows the transportation company to buy shares of its stock through open market purchases. Shares repurchase plans are usually an indication that the company’s leadership believes its stock is undervalued.
A number of hedge funds and other institutional investors have recently bought and sold shares of the stock. Partners Capital Investment Group LLP bought a new stake in United Continental in the fourth quarter valued at about $1,332,000. Focused Wealth Management Inc bought a new stake in United Continental in the fourth quarter valued at about $135,000. Koch Industries Inc. bought a new stake in United Continental in the fourth quarter valued at about $453,000. Amundi Pioneer Asset Management Inc. increased its stake in United Continental by 51.0% in the fourth quarter. Amundi Pioneer Asset Management Inc. now owns 1,013,009 shares of the transportation company’s stock valued at $68,276,000 after acquiring an additional 341,989 shares during the period. Finally, 180 Wealth Advisors LLC bought a new stake in United Continental during the fourth quarter worth about $365,000. 94.21% of the stock is currently owned by institutional investors and hedge funds.
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About United Continental
United Continental Holdings, Inc (UAL) is a holding company and its principal subsidiary is United Air Lines, Inc (United). The Company transports people and cargo through its mainline operations. It has global air rights in North America, Asia-Pacific, Europe, Middle East, Africa and Latin America. The Company, through United and its regional carriers, operates flights from its hubs at Newark Liberty International Airport (Newark Liberty), Chicago O’Hare International Airport (Chicago O’Hare), Denver International Airport (Denver), George Bush Intercontinental Airport (Houston Bush), Los Angeles International Airport (LAX), A.B.
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