Avoid Wall Street’s “Favorite Stock” At All Costs

It may be the same for you, but when I read financial news, I often need to read it multiple times to fully grasp the complexity of Wall Street.

For example, the current “favorite” stock of Wall Street is not what you might expect. Instead of Nvidia, Microsoft, or Meta, it’s actually United Airlines.

13 analysts on Wall Street cover the stock and 77% of them have buy ratings. The consensus price target in 12 months is $63.46, which implies a 50% increase from current prices.

The reason for this bullish rating is United’s outperformance in the fourth quarter earnings and its positive outlook for 2024, which includes setting new records and surpassing earnings and revenue forecasts.

While United Airlines has shown resilience and strategic restructuring, there are some challenges ahead that may impact its future performance:

1. Challenges with Boeing’s 737 MAX aircraft, which has led to operational disruptions and financial strain.
2. Geopolitical conflicts in Gaza and Ukraine that can affect global travel patterns and operational costs for airlines.
3. The potential threat of a recession, which could lead to a decline in both leisure and business travel.
4. Possible increases in oil prices, which could impact airlines’ profitability due to fuel costs.

Given these challenges, it’s uncertain if United Airlines will rise 50% by next March. However, there are better investment choices available. Check out our updated list of stocks to buy for more promising options.