United Airlines (UAL, Financial) has announced a $1.5 billion stock buyback plan following better-than-expected earnings during the summer travel peak. The airline expects strong performance in the last quarter of the year, projecting an adjusted earnings per share of $2.50 to $3. This is a significant increase from the $2 per share in the same quarter last year, and aligns closely with analysts' estimates of $2.68 per share.
This marks United Airlines' first stock repurchase since the onset of the COVID-19 pandemic. During the pandemic, U.S. airlines received over $50 billion in government aid and were prohibited from engaging in stock buybacks and dividend payments. Despite ongoing financial stability challenges, airlines are gradually reintroducing such financial strategies.
United Airlines' CEO, Scott Kirby, emphasized the strategic nature of this buyback decision while reaffirming the commitment to investing in employees and business operations as a priority.
In comparison, Southwest Airlines announced a $2.5 billion stock buyback plan last month.
