What Happened?

Shares of global airline American Airlines (NASDAQ:AAL) fell 5.4% in the morning session after Israel carried out significant strikes on Iranian nuclear and military sites, dramatically escalating fears of a broader conflict in the Middle East. This development has sent crude oil prices surging, as investors fear potential disruptions to global oil supply and a wider regional conflict. The conflict also fueled fears of higher operating costs for airlines and reduced global travel demand.

The shares closed the day at $10.38, down 4.8% from previous close.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy American Airlines? Access our full analysis report here, it’s free.

What The Market Is Telling Us

American Airlines’s shares are quite volatile and have had 19 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 17 days ago when the stock gained 5.1% on the news that the major indices rebounded (Nasdaq +2.0%, S&P 500 +1.5%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025. Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.

American Airlines is down 39% since the beginning of the year, and at $10.37 per share, it is trading 44.4% below its 52-week high of $18.66 from January 2025. Investors who bought $1,000 worth of American Airlines’s shares 5 years ago would now be looking at an investment worth $620.96.

Today’s young investors likely haven’t read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.