Since February 2026, United Airlines has been in a holding pattern, posting a small return of 3.4% while floating around $116.83. The stock also fell short of the S&P 500’s 11.3% gain during that period.
Is now the time to buy United Airlines, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Do We Think United Airlines Will Underperform?
We’re passing on United Airlines for now. Here are three reasons why UAL doesn’t excite us, plus one stock we’d rather own.
1. Weak Growth in Revenue Passenger Miles Points to Soft Demand
Revenue growth can be broken down into changes in price and volume (for companies like United Airlines, our preferred volume metric is revenue passenger miles). While both are important, the latter is the most critical to analyze because prices have a ceiling.
United Airlines’s revenue passenger miles came in at 72.77 billion in the latest quarter, and over the last two years, averaged 5.1% year-on-year growth. This performance was underwhelming and suggests it might have to lower prices or invest in product improvements to accelerate growth, factors that can hinder near-term profitability. 
2. Cash Flow Margin Set to Decline
If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.
Over the next year, analysts predict United Airlines’s cash conversion will fall. Their consensus estimates imply its free cash flow margin of 4% for the last 12 months will decrease to 2.7%.
3. New Investments Bear Fruit as ROIC Jumps
A company’s ROIC, or return on invested capital, shows how much operating profit it makes compared to the money it has raised (debt and equity).
Fortunately, United Airlines’s ROIC averaged 3 percentage point increases each year over the last few years. This is a good sign, and we hope the company can continue improving.
Final Judgment
United Airlines doesn’t pass our quality test. With its shares lagging the market recently, the stock trades at 8.7× forward P/E (or $116.83 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are more exciting stocks to buy at the moment. We’d recommend looking at one of our all-time favorite software stocks.
Stocks We Like More Than United Airlines
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
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