Is UAL's Q1 2025 earnings forecast optimistic?

United Airlines' (UAL) Q1 2025 earnings forecast appears to be optimistic, considering the following points:

1. Analyst Upgrades and Increased Estimates:
   • Seaport Res Ptn has boosted its Q1 2025 EPS estimate for United Airlines from $0.60 to $0.75. This increase reflects a more positive outlook on UAL's performance for the period.
   • Morgan Stanley and Susquehanna have also raised their price targets on UAL, indicating a bullish sentiment.
2. Consensus Estimates and Company Guidance:
   • The consensus EPS estimate for Q1 2025 is $0.88, which is higher than Seaport Res Ptn's previous estimate of $0.75. This suggests that analysts are generally expecting a strong performance from UAL in the quarter.
   • UAL's updated earnings guidance for Q1 2025 is $0.75 to $1.25, which is significantly above the consensus estimate. This indicates that UAL is anticipating a stronger performance than what analysts are currently projecting.

3. Recent Performance and Market Sentiment:
   • UAL's stock has surged by over 180% in the past 12 months, outpacing all other U.S. carriers. This strong stock performance suggests that investors are optimistic about UAL's future prospects.
   • The company's robust financial performance in Q4 2024, with EPS of $3.26 exceeding estimates and revenue climbing 8% year-over-year, supports the notion that UAL is on track to deliver strong earnings in 2025.
4. Demand Recovery and Growth Prospects:
   • UAL expects domestic revenue per available seat mile (RASM) to turn solidly positive year-over-year in Q1 2025, alongside continued improvement in international RASM. This indicates that the airline is optimistic about the demand recovery and growth in the upcoming quarter.
   • The airline's focus on capitalizing on global travel recovery trends and its projected adjusted EPS for FY2025 in the range of $11.50 to $13.50 further supports the optimistic outlook.

In conclusion, UAL's Q1 2025 earnings forecast is likely optimistic due to analyst upgrades, increased estimates, strong stock performance, and the company's positive outlook on demand recovery and growth prospects.