The Fort Worth, Texas, carrier, struggling with the coronavirus shutdown, will end the year with "net debt far exceeding revenue," the analyst, Duane Pfennigwerth, wrote.
Pfennigwerth has an underperform rating on the stock.
Shares of American Air, which on Thursday posted a wider-than-expected first-quarter loss, were down 11% to $10.67.
The analyst said in a note to investors that "American entered this crisis with the weakest relative balance sheet – the result of a long-term heavy capital-expenditure program, keeping up with the Joneses on capital return (despite lack of underlying free cash flow) and company-specific margin degradation."
Airlines have been hit hard by the lengthy economic shutdown as countries try to slow the spread of the disease with travel restrictions and social distancing requirements.
"Parts of American’s earnings call yesterday struck us as out of sync with the severity of this crisis, such as the unwillingness to put a long-term network restructuring on the table (we like every hub)," Pfennigwerth said. "Equity investors may not be the target audience for these earnings calls anymore."
By year-end 2020, the analyst said, "we estimate AAL will be levered about 9.8 times net-debt to [earnings before interest, taxes, depreciation, amortization and rent/restructuring] on our reduced 2021 estimates – with net debt far exceeding revenue."
"This estimated balance-sheet trajectory crowds out the potential for meaningful equity value recovery," Pfennigwerth said.
American Airlines on Thursday reported an adjusted first-quarter loss of $2.56 a share, compared with profit of 41 cents a share in the year-earlier quarter and with a Wall Street consensus forecast of $2.08 a share according to FactSet.
It was the carrier's first quarterly loss since it emerged from bankruptcy protection in 2013.