There's a single reason why American is the least attractive of US legacy carriers (in terms of investing, anyway): its balance sheet.

If most airlines and certainly those in the US are loaded up to the hilt with debt, American goes so far as to boost negative equity - any startup would go belly-up with a balance sheet such as this one.

Now, you can survive and even generate decent returns with a precarious capital structure, but of course you're super sensitive to any shock on the demand side of your business, hitting both revenues and margins - and that is where the clouds gather on American.

After the industry's recent warnings re falling travel demand, the already cut-throat competition for market share will get yet more intensive, while margins will inevitably come under pressure.

I fail to see why American might be an attractive investment proposition outside of the rosiest of economic outlooks, which is not what's at hand right now.

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Disclaimer

The user PittTheYounger holds no position in NasdaqGS:AAL. Simply Wall St has no position in any of the companies mentioned. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.