Everyone is Bullish on United (UAL) -- are we?

Everyone and their mother, it seems is Bullish on United Airlines (UAL).

We caught wind of improving consumer metrics a little over a year ago, when the stock was trading around $40.

Since then, United's stock value has rocketed higher -- besting its peers and posting triple digit gains.

What's driving United's massive success?

Three items we touched on last January:

• Improving consumer happiness - United is effectively catering to high-and-low class travelers, providing a premium experience for those who want to pay more, and a "no thrills" experience to those who want to travel on a budget. Basic economy tickets were up +20% in Q3.

• Strong business growth - coroporate revenue grew +13% last quarter.

• Premiumization - premium revenue grew +5% in Q3. The chart below shows the opportunity at hand, with United even with British Airways when it comes to upsell opportunity.

  

So where does this leave us ahead of earnings?

Facing a very high bar.

UAL stock is at all time highs ahead of Q4 earnings, riding a strong wave of bullish momentum.

But data suggests some of this growth may be slowing. Check out web visits, down -9% on a YoY basis.

This is a bit concerning related to forward-looking bookings.

We also pose another question:

Has an expected strong report from United already been baked into the stock after a stellar performance by its premium-adjacent peer?

Delta (DAL) posted a strong Q4 report earlier this month, bolstered by high-spending clientele.

DAL has focused heavily on premium offerings, which played a critical role in driving its earnings growth. Premium travel categories, including Delta One, Premium Select, and Comfort+, contributed significantly to revenue as demand for higher-end travel experiences surged.

For 2024, Delta reported that revenue from premium products grew at a faster rate than revenue from standard Main Cabin tickets, with premium products accounting for over 30% of total passenger revenue.

United Airlines is expected to benefit from the same premiumization and corporate travel trends.

We fear this name has no room for error -- Expecting a nice report but not taking the upside bet this time.