American Airlines Group (AAL-Q)

He can't recommend the airlines now. Fuel costs are too high.

He prefers Delta, but he likes airlines, a business which is in flux. AAL shares are not expensive.

Travel industry recovering after Covid-19 pandemic. 
Sales stronger than the past few years.
Would wait to buy shares in October.
Seasonality - not a great time to buy shares.

Not worried, because AA actually increased their estimates last month. The problem is that street's estimates got ahead of itself.

Bank of America reports there's an 8% increase in travel vs. 2019 (not 2020 during Covid). This trend will benefit American Airlines and Delta (his favourite airline), especially when international travel returns. True, shares have run up, but he feels there's still plenty of runway left.

It's moved up too much and had to do an equity raise. Doesn't know how much money they're losing. Buy Boeing instead.

An $11 stock, but he prefers LUV because it doesn't lose money and has a better long-term outlook.

WJA-T vs. AAL-Q. On AAL-Q, the industry has consolidated so the airlines have pricing power. 10 years ago all these airlines were losing money. There are ultra low cost carriers coming in and undercutting the others and there is a bit of a price war going on. This is not happening in Canada. He would stay out of the US. WJA-T is safer than AC-T.