Here's the Reason American Airlines (AAL) Shows Powerful Momentum

Maximizing Your Stock Market Potential with Zacks Premium

Whether you're just starting out or have years of investing experience, making the most of the stock market and investing with assurance are universal objectives. Zacks Premium offers a variety of resources to help you achieve both.

This comprehensive service delivers daily updates on the Zacks Rank and Industry Rank, full access to the exclusive Zacks #1 Rank List, in-depth equity research reports, and advanced stock screening tools. These features are designed to empower you to make smarter, more confident investment decisions.

Subscribers also benefit from the Zacks Style Scores, which provide additional insights for evaluating stocks.

Understanding Zacks Style Scores

Developed to complement the Zacks Rank, the Zacks Style Scores are unique indicators that assess stocks using three popular investment strategies. These scores help investors identify stocks with the highest likelihood of outperforming the market in the next month.

Each stock receives a letter grade—A, B, C, D, or F—based on its value, growth, and momentum characteristics. An "A" rating signals a stronger potential than a "B," and so on, indicating that higher scores suggest a greater chance of outperformance.

The Style Scores are divided into four main categories:

Value Score

Value-oriented investors seek quality stocks trading below their intrinsic worth, often before the broader market recognizes their potential. The Value Score uses metrics such as price-to-earnings, PEG, price-to-sales, and price-to-cash flow ratios to highlight the most attractively priced stocks.

Growth Score

Growth-focused investors prioritize a company's future prospects and financial strength. The Growth Score evaluates factors like projected and historical earnings, revenue, and cash flow to pinpoint companies poised for sustained expansion.

Momentum Score

Momentum investors believe in capitalizing on prevailing trends. This score considers variables like short-term price changes and recent shifts in earnings estimates to identify stocks experiencing strong upward or downward momentum, signaling optimal times to invest.

VGM Score

If you prefer a well-rounded approach, the VGM Score combines value, growth, and momentum metrics into a single rating. This comprehensive score helps investors zero in on stocks that excel across all three styles, making it a powerful tool when used alongside the Zacks Rank.

Integrating Style Scores with the Zacks Rank

The Zacks Rank is a proprietary system that leverages changes in earnings estimates to help investors build winning portfolios.

Since 1988, stocks rated #1 (Strong Buy) have delivered an impressive average annual return of +23.86%, more than doubling the S&P 500's performance over the same period. However, with over 200 companies often holding a Strong Buy rating and another 600 rated #2 (Buy), narrowing down your choices can be challenging.

With more than 800 highly rated stocks to consider, selecting the right ones for your portfolio can feel overwhelming.

This is where Style Scores become invaluable.

To enhance your investment results, focus on stocks with a Zacks Rank of #1 or #2 and Style Scores of A or B. If you're considering stocks rated #3 (Hold), prioritize those with top Style Scores to maximize potential gains.

Because Style Scores are designed to work in tandem with the Zacks Rank, any updates to a company's earnings outlook should influence your investment decisions.

For example, a stock with a #4 (Sell) or #5 (Strong Sell) rating—even if it boasts high Style Scores—likely faces declining earnings expectations and a higher risk of price drops.

Owning more stocks with a #1 or #2 Rank and A or B Style Scores increases your chances of success.

Featured Stock: American Airlines (AAL)

American Airlines Group Inc. emerged from the 2013 merger of AMR (the parent company of American Airlines, established in 1934) and U.S. Airways. This merger, which followed American Airlines' bankruptcy, created the world's largest airline. Headquartered in Fort Worth, Texas, American Airlines primarily offers passenger and cargo transportation. As of 2024, the company operated 977 mainline aircraft, with regional subsidiaries and partners flying an additional 585 regional jets. The regional division, American Eagle, encompasses six airlines, three of which—Envoy Air, Piedmont Airlines, and PSA Airlines—are wholly owned by the group. Major hubs include Charlotte, Chicago, Dallas/Fort Worth, London Heathrow, Los Angeles, Miami, New York, Philadelphia, Phoenix, and Washington, D.C. Domestically, American Airlines competes with carriers like Alaska Airlines, Delta, JetBlue, Southwest, and United, while its international network spans Canada, Mexico, the Caribbean, Central and South America, Asia, Europe, Australia, and New Zealand.

Currently, AAL holds a #3 (Hold) Zacks Rank and a VGM Score of B.

Momentum investors may find AAL particularly appealing. The stock has earned an A for its Momentum Style Score and has climbed 3.2% in the past month.

For fiscal year 2026, six analysts have raised their earnings projections in the past two months, pushing the Zacks Consensus Estimate up by $0.20 to $2.18 per share. The company has also delivered an average earnings surprise of +3.5%.

With a solid Zacks Rank and strong Momentum and VGM Scores, AAL deserves a spot on investors' watchlists.

Top Analyst’s Pick for Potential Doubling

Out of thousands of stocks, five Zacks experts have each selected their top choice for a possible 100%+ surge in the coming months. From these, Director of Research Sheraz Mian has identified one standout with the greatest potential for explosive growth.

This company, which targets millennial and Gen Z consumers, generated nearly $1 billion in revenue last quarter. A recent dip in its share price presents an attractive entry point. While not every top pick is a guaranteed winner, this selection could outperform previous Zacks picks like Nano-X Imaging, which soared over 129% in just nine months.