American Airlines Group Inc. (AAL): fair value, margin of safety and Wheel Score

Is AAL undervalued?

American Airlines Group Inc. (AAL) closed at 12.28 on 16 Oct 2026. The GLS average fair value - the simple average of the 2 valuation models that produced a positive number - is 165.90, which puts the price 93% below it. 2 of the 2 models value the shares above the current price. A gap this wide is rare in our universe of ~7,400 US stocks and is exactly what the Value part of the Wheel Score rewards; it is also where the question "why is it this cheap?" matters most.

Only 2 of the nine models produced a value (DCF, 10 Cap); the others need a dividend, positive free cash flow or positive book value the company does not have yet, so the average rests on a narrow base.

The nightly engine files AAL under Speculative / Distressed - negative earnings or a Piotroski score of 3 or less - which caps its Wheel Score at 45 and keeps it out of the Sunday Scan.

Nine valuation models for AAL

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Financial health is weak: AAL passes 3 of the nine Piotroski tests. Our screens drop the stock at the health rule; a low score is often the reason a stock looks cheap on the valuation models. The GLS Moat score is low at 0.8 out of 10, which says the ten-year record of revenue, earnings, margins and returns on capital has been inconsistent - growth and shocks rather than steady compounding.

Returns on capital are thin or negative - ROIC 0.3%, ROE -3.0%, ROA 0.2% - with debt at -9.65 times equity and a free-cash-flow yield of 3.5%.

American Airlines Group Inc. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Passenger 49%, Passenger Travel 46%, Product and Service, Other 4% (quarter Q2 FY2026).

Institutional ownership scores 10/10, insider activity 1/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 45: Weak

AAL scores 45 out of 100 on the Wheel Score, in the Weak band (under 50), capped at 45 because the engine files it as Speculative / Distressed. Value 25/25, Health 7/20, Moat 1/15, Premium 20/20, Stability 19/20. The score is not a judgement on the company; it says the price, quality and premium do not line up for selling puts on it today.

Implied volatility is 47% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. The option chain is deep: 1,986,502 contracts of open interest across all expiries, which means tight fills at most strikes.

Volume runs at 71.1M shares a day on a market cap of $8.1B, with a beta of 1.38 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 19 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

American Airlines Group Inc. reports earnings on 22 Oct 2026 (before the open) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Airlines, Airports & Air Services

The 12 companies below are the closest to American Airlines Group Inc. by market cap within the Airlines, Airports & Air Services industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

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