Is There A Hidden Opportunity In UAL Stock?

SectorFinancial Markets
CountryMiddle east

United Airlines Boeing 767-400 ER Extended Range with 2x CF6-80 engines aircraft landing at ... [+] Amsterdam Schiphol International Airport AMS EHAM in The Netherlands, the Dutch capital. The airplane has registration N66057 and its type is exactly Boeing 767-424(ER) . UAL / UA is a major American airline headquartered in Chicago, Illinois connects Amsterdam with ChicagoO'Hare, Houston Intercontinental, Newark, Washington Dulles and seasonal to San Francisco (Photo by Nicolas Economou/NurPhoto via Getty Images) NurPhoto via Getty Images The shares of United Airlines surged 10% in the past week triggered by hopes of a successful vaccine by early next year.

We believe that there is a hidden opportunity in United Airlines’ stock (NASDAQ: UAL), which has lost 53% of its value since the beginning of the year and currently trades near $41. The company observed only $2 billion of operating cash outflow for the first nine months primarily supported by the $3 billion grant under the CARES Act. Considering the average daily cash burn rate of $25 million in the fourth quarter, the company’s net debt is likely to increase by another $2 billion in the fourth quarter. Given the positive results released by more...