Air Canada (TSX:AC) stock rose last week after the company reported its most recent earnings numbers. The airline reported operating revenue of $6.1 million for the third quarter, which was down 4% year over year and its adjusted diluted earnings per share fell from $3.41 to $2.57.
It wasn’t a great quarter but the company is bullish nonetheless and it upgraded its guidance for the year, now projecting adjusted EBITDA of around $3.5 billion. Previously, it was projecting no more than $3.4 billion.
The company is also going to buyback shares, which should give the stock a bit of a boost.
Air Canada stock needs a much-needed boost as over the past five years it has lost more than half of its value due to the challenges it faced as a result of the pandemic. And while the business is in much better shape today, investors are still wary of investing in the company, especially with concerns of a slowdown coming for the economy.
The stock hit a new 52-week high on Friday and there does appear to be some renewed excitement around Air Canada. In recent weeks, the stock’s 20-day moving average has made two crossovers, once to jump higher than the 50-day moving average and more recently it rose above the 200-day moving average. Amid a decline in oil prices, there could be more reason to be optimistic about Air Canada stock in the future.
For long-term investors, this can be a solid stock to own given Air Canada’s leadership in the airline industry. While there will be some uncertainty, its reduced valuation could make it an appealing stock to buy right now.
