United Airlines stock has soared in recent months and the carrier’s fourth-quarter earnings late Tuesday could send the shares flying even higher.
Delta Air Lines set the tone for earnings season earlier this month with a big revenue and earnings beat. But it was Delta’s outlook that really buoyed investors as the carrier signaled strong demand continuing in 2025, guiding for revenue growth of 7-9% in the first quarter.
On closer inspection, the reasons behind Delta’s positive guidance — robust demand for premium travel and improving corporate sales — are good news for United, which has strong exposure to both.
United is the “biggest beneficiary” of Delta’s outlook, BofA analysts said in a note last week. They hiked earnings estimates as a result, and increased their price target on the Buy-rated stock to $120 from $100, implying 12% upside to Friday’s closing price.
However, they also downgraded low-cost airlines JetBlue Airways and Southwest Airlines to Underperform from Neutral, noting that they have “less exposure to premium, corporate and international” travel while both trading at a premium.
Analysts are expecting United to report earnings of $3.03 per share on revenue of $14.4 billion in the fourth quarter, according to FactSet estimates. For the full-year 2025 they expect EPS of $12.80, while in the first quarter, they are looking for EPS of 57 cents.
It would be the airline’s first quarterly profit in the first three months of a year since 2019.
The stock has been on a great run, climbing 124% over the past six months and 11% so far in 2025. Wall Street has an average price target of $128.19 on the stock, pointing to a 19% jump from current levels.
Deutsche Bank analyst Jamie Baker is more bullish than most, with a price target of $133. “Delta afforded an unexpectedly robust start to earnings season, with clear positive indications for American and United, ” he said.
Baker noted that the constructive backdrop for the sector rests on five factors — “the premium phenomenon, international momentum, loyalty returns, aircraft supply constraints, and the impairment of the discount sector.”
“In our view, these five tailwinds explain the sector’s torrid post-July rally and can continue to blow with equal, if not great intensity as 2025 is getting under way,” he added.
So everything is on course for a strong earnings report by United. It just needs to deliver.