The stock price of American Airlines saw a huge surge after it had made a narrower-than-expected loss recently. It is considered to be the most sold stock with underperforming ratings in S&P 500. According to the chief market strategist and Chantico Global CEO Gina Sanchez, this year American Airlines can see a higher improvement. The recent surge in its stock has drawn the attention of Reddit traders. Reddit traders have recently aimed at AMC and GameStop.
Unloved Stock American Airlines Is Attracting Traders
According to Sanchez, while most of the traders focus on the recovery of stocks, some find attractive opportunities in unloved stock as it can give them a chance to make a profit from the recovering period. For the past year, American Airlines is facing pressure. The reason behind it is of course the pandemic that created a stagnancy in international and domestic travel.
Sanchez explains that going for the unloved stock is cheaper and it will be very beneficial to the traders as the broad sectors like these are going through recovery now. Another shorted stock is Bed, Bath & Beyond which has above-average ratings of sell. Bed, Bath & Beyond’s short interest at 63% has also attracted Reddit traders to make deals on it. This year shares have reportedly risen to 89% as the retail flows are moving short traders to fix the positions.
The stock for American Airlines is still 41% behind its February culmination while it is up for 119% since having a low dip in May.
According to the head of Fairlead Strategies Katie Stockton, the recent surge of stock was influenced by the involvement of the retailers. She expects the increase to continue especially for the unloved stocks.
Western Union, another unloved stock, has shown sideways price action which is being favored by the traders to a great extent. Western Union increased by 32% from the April low but it is still 19% lower than its February high as of now.
Currently, the shares of American Airlines are still swinging but showed an almost 30% increase at a point.