United Air shares close lower on Monday, Credit Suisse initiates coverage on the stock with “Outperform” rating

November 20, 2018 11:10 am

Credit Suisse initiated coverage on United Continental Holdings Inc (UAL) with an “Outperform” rating and also assigned a price target of $113 on the stock. The price target represents 11 times the 2019 earnings per share estimate.

United Air shares closed lower for the fourth time in the past thirteen trading sessions on NASDAQ on Monday. The stock edged down 0.18% ($0.17) to $92.09, after touching an intraday high at $92.95, or a price level not seen since November 14th ($93.47).

Shares of United Continental Holdings Inc have risen 36.63% so far in 2018 compared with a 0.64% gain for the benchmark index, S&P 500 (SPX).

In 2017, United Air’s stock retreated 7.52%, thus, it underperformed the S&P 500, which registered a 19.42% return.

“United is effectively leveraging a domestic growth strategy to realize its network potential by driving higher connectivity in its midcontinent hubs and therefore higher network profitability,” Credit Suisse analyst Jose Caiado wrote in a research note.

According to Caiado, the turnaround plan at the airline is in full swing, while its fuel recapture is “best-in-class”.

The analyst said there was no evidence of momentum slowdown at the company. He also noted that market players should “resist the temptation to rotate into a laggard for a catch-up trade.”

According to CNN Money, the 15 analysts, offering 12-month forecasts regarding United Air’s stock price, have a median target of $98.00, with a high estimate of $130.00 and a low estimate of $87.00. The median estimate represents a 6.42% upside compared to the closing price of $92.09 on November 19th.

The same media also reported that 8 out of 18 surveyed investment analysts had rated United Air’s stock as “Buy”, while other 8 – as “Hold”.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for United Continental Holdings Inc (UAL) are presented as follows:

Central Pivot Point – $91.58
R1 – $94.15
R2 – $96.03
R3 – $98.60
R4 – $101.16

S1 – $89.70
S2 – $87.13
S3 – $85.25
S4 – $83.36

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