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United Airlines Plunges 24% in 3 Months: Buy the Dip?
Shares of Chicago-based airline heavyweight United Airlines (NASDAQ: UAL) have not had a good time on the bourses of late, declining 23.8% in the past 90 days. The disappointing price performance resulted in UAL underperforming its industry's 5.6% decline in three months. It also underperformed the S&P 500, of which the airline is a key member. However, UAL's price performance compares favorably with that of fellow U.S. airline operators American Airlines (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) in the same timeframe.
Three-Month Price Comparison
Image Source: Zacks Investment Research
UAL is currently trading at a 25.8% discount to its 52-week high of $56.18, reached on May 16, 2024. In fact, United Airlines shares have plummeted more than 50% over the past five years and are currently trading at levels significantly below the pre-COVID levels. Additionally, this airline company's stock has slipped below its 50-day moving average, which is an important indicator for gauging market trends and momentum. Falling below this average suggests a bearish trend, often prompting caution to investors.
50-Day Moving Average
Image Source: Zacks Investment Research
Given the significant pullback in UAL's shares currently, investors might be tempted to snap up the stock. But is this the right time ...