AMR: AMR looking Up

While the financial sectors remain volatile and send shock waves through the market, American airlines is poised for recovery from its low of $4.41 back in July. Back then AMR was dealing with the grounding of nearly 1000 flights on its workhorse planes, the MD 80, oil prices that seemed to rise without limit, topped off with speculation of an imminent recession. Now in the two months since the near collapse of the world's largest international airlines, AMR's market price has risen 280%. To further strengthen AMR's potential for growth, oil prices have dropped below $100 for the first time in months, and the failure of numerous small carriers has reduced the pressure on airlines to a degree. Though controversial, the charge for first and second bags on AMR flights is not expected to cause a significant drop in bookings but will no doubt offset the amount the ticket price would need to be raised by in order for domestic airlines to keep afloat. Don't expect for AMR to reach its pre 9/11 value any time soon, but things are looking up for this legacy carrier.