United Airlines (UAL) reported better-than-expected fourth-quarter 2022 results earlier this week, delivering its third consecutive profitable quarter. Moreover, revenue surged more than 51% year over year thanks to strong air-travel demand.
The airline’s outlook was upbeat, with management forecasting capacity will improve by 20% year over year in the current quarter, while revenue is expected to grow by almost 50%.
The stock has sold off about 8% since the announcement, but I suspect this has more to do with broader market weakness than the company’s results.
I am recommending we sell a put to take advantage of elevated volatility levels, as I see shares trading higher once the market stabilizes.
Current Stock Price: $47.10
Action: Sell to open UAL Jan Week Four (1/27) 45 Put for around $0.42. You can go as low as $0.36, but please don’t start there and always use limit orders.