AMR - American Airlines Inc.

[AMR] American Airlines Inc. - Hot Stocks to Buy Entry Price $5.75 - $6.25

• Risk level: 6
• Profit potential: 9
• Price Target 6 months: $11 - $12
• Price Target 12 months: $16 - $18
• We expect AMR to outperform the market in the short and long term.

AMR Corp, owns and operates in the airline industry.  Through American Airlines Inc., AMR provides scheduled jet service to approximately 150 destinations throughout North America, South Ameria, Europe and Asia.  AMR also owns AMR Eagle Holding Corp, which operates two regional airlines that provides service throughout North America.

The airline industry has been decimated by many factors ranging from the economy, oil’s onetime $150 price to the recent swine flu outbreak in Mexico.  We feel that all the negative news for the airline sector has reached it’s peak and the bleeding of the stock price should be coming to an end.  AMR’s stock fell from it’s Jan. 8th, 2009 price of $12.29 to a recent 52 week low of $2.40 on March 6th.  Since then it has more than doubled in price over the last month and a half.  We feel the recovery in AMR and airline stocks is still in the early stages and expect the stocks to continue moving higher.  We list a few highlights as to why we have added AMR to our Hot Stocks to Buy list.

Swine flu pandemic is turning out to be a bust and consumers will begin to travel again

Travel loads shows signs of improvement as April’s travel data shows fuller planes (MarketWatch)

Increases in miscellaneous fees and additional services (Expected addition of Wi-Fi service in the near future (Wall Street Journal) will add to the bottom line

Oil’s recent price increases are showing very little effect on AMR’s stock price

Summer travel months are approaching

Possible buyout canidate as consolidation in the industry continues

In our opinion the risk level for AMR is moderate with high growth potential.  A  medium size holding would be appropriate for AMR stock.  A good entry price for AMR is anything below $6.5 in the near term.  The stock may continue to fall another 5% in the short term.

We wish you luck on your investments and as always do your own research prior to purchasing or selling a stock. We make recommendations based on our own research and this site is solely for the purpose of entertainment reading. Thank you for visiting Hot Stocks to Buy.