American Airlines Group Inc.’s stock gained 3.2% on Monday, after a slew of upgrades that acknowledged the company is coming out of transitory 2024 challenges to a better backdrop in 2025. The big airlines are in better shape than low-cost and ultralow-cost carriers, which are experiencing headwinds in the post-pandemic world.

Shares of American Airlines surged Monday after brokerages Jefferies and TD Cowen upgraded and raised their price targets on the air carrier's stock.

AAL is a chip shot from its Dec. 10 two-year high of $18.20. Since that peak, the shares have consolidated around $17, with their 100-day moving average catching last week's pullback. Year-over-year, the equity is now 30.3% higher.

The upgrades come as American Airlines has seen a substantial improvement in its domestic market, with competitors making cuts and network changes that have led to increased pricing power. Analysts expect this trend to positively affect American's performance, along with the airline's strategic positioning and fleet enhancements.

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Sheila Kahyaoglu, Jefferies aerospace and defense analyst, joins CNBC's The Exchange to discuss why her firm increased the price target on American Airlines to $20 from $12, her take on other airlines,

Fintel reports that on January 6, 2025, Jefferies upgraded their outlook for American Airlines Group (NasdaqGS:AAL) from Hold to Buy. Analyst Price Forecast Suggests 3.00% Upside As of December 22, 2024,