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United Airlines (UAL - Free Report) is scheduled to report fourth-quarter 2022 results on Jan 17, after market close.

The Zacks Consensus Estimate for UAL’s fourth-quarter 2022 earnings has been revised upward by 120% in the past 90 days. The company has a solid earnings surprise history, having outperformed the Zacks Consensus Estimate in two of the preceding four quarters, the average beat being 7.77%.

United Airlines Holdings Inc Price and EPS Surprise

United Airlines Holdings Inc price-eps-surprise | United Airlines Holdings Inc Quote

Let’s see how things are shaping up for United Airlines this earnings season.

Q4 Expectations

The Zacks Consensus Estimate for United Airlines’ fourth-quarter 2022 revenues is pegged at $12.25 billion, indicating 49.52% growth year over year. The top line is likely to have been aided by a solid recovery of air-travel demand (post the pandemic-led slump) and an improvement in passenger revenues (which accounts for more than 80% of total revenues). Driven by solid demand, management expects total revenue per available seat mile to increase in the 24%-25% band in the December quarter from fourth-quarter 2019 actuals.

On the flip side, high fuel costs per gallon are likely to have hurt the bottom line in the fourth quarter. UAL forecasts the average aircraft fuel price per gallon to be $3.61 in the fourth quarter, much higher than the reported figure in fourth-quarter 2021.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for United Airlines this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

United Airlines has an Earnings ESP of -0.03% and a Zacks Rank #2.

Highlights of Q3

United Airlines’ third-quarter 2022 earnings of $2.81 per share beat the Zacks Consensus Estimate of $2.21 and our estimate of $2.17. In the year-ago quarter, UAL incurred a loss of $1.02 per share when air-travel demand was not as buoyant as in the current scenario. The third quarter of 2022 was the second consecutive profitable quarter at UAL since the onset of the pandemic.

Operating revenues of $12,877 million beat the Zacks Consensus Estimate of $12,709.5 million and our estimates of $12, 631.6 million. UAL’s revenues increased more than 66% year over year owing to upbeat air-travel demand. The optimistic air-travel demand scenario is also evident from the fact that total operating revenues increased 13.2% from third-quarter 2019 (pre-coronavirus) levels.

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