American Airlines Group Inc (NASDAQ: AAL) is screaming for the top in the market thsi morning, trading on gains of more than 25% in the premarket. However, if you’re looking for press releases or SEC filings from the company, you’ll be hard pressed to find anything. Nonetheless, there is a clear catalyst for the gains with a vaccine signalling to the potential end to the COVID-19 pandemic is coming soon. Here’s what’s going on:
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AAL Stock Rockets On COVID-19 Vaccine Data
As mentioned above, American Airlines hasn’t issued any press releases or filed anything with the SEC, but they didn’t have to. Pfizer and BioNTech announced data from a clinical trial assessing a COVID-19 vaccine this morning. The candidate has shown a 90% effectiveness along with a favorable safety and tolerability profile.
As such, many believe that the vaccine will receive Emergency Use Authorization before the end of November and be available in the United States by the end of the year. Of course, when the vaccine hits the masses, the pandemic will quickly come to an end.
So, what does this have to do with AAL stock? EVERYTHING!
The COVID-19 pandemic has been a very painful experience for the travel industry as a whole. During lock downs, travel was forbidden. Even after the United States began to reopen its economy, the thought of being cramped in an plane for hours with several people who may be infected has been scary, leading to massive declines in air travel, cruises, and more.
Nonetheless, when the COVID-19 pandemic comes to an end, consumers who have been couped up in their homes will want to get out, plan vacations, fly to see family, and more. As such, this vaccine means the world for stocks like AAL, CCL, DIS, DAL, and other big players in the travel and vacation industries.
The Bottom Line
I’ve been pointing to this opportunity for quite some time. In fact, a couple of months ago, my aunt and I discussed the potential dramatic gains that could be ahead for the travel industry, with airlines likely taking the lead. With a vaccine now on the horizon, that prediction seems to be coming to fruition.
The good news is that the gains in American Airlines stock are far from over. With the dramatic declines seen across the stock during the pandemic, AAL has quite a bit of room left for a recovery. With vaccine availability likely just around the corner, this is an opportunity that shouldn’t be ignored.
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