NEW YORK (TheStreet) -- A prolonged downward period continues for airline stocks, which are struggling due to fears of lacking travel demand, but there may be some optimism for a few companies.

Hunter Keay, Managing Director and Senior Analyst at Wolfe Research, believes that United Continental  (UAL) - Get Report is experiencing a gradual turnaround.

"United went from having the worst board in the industry to having the best board industry within the last three months," Keay said on CNBC's "Power Lunch" on Wednesday. "And governance takes a long time to trickle down into good management."

Keay sees "a lot of potential upside" for United, as they could "potentially close the gaps margins and close the gap on cash flow."

"But it's been a rough road for them," Keay noted. "It's been two steps forward, two steps back for them since the merger with Continental, really over the last four or five years."

Additionally, Keay believes that "the stronger U.S. dollar has more of a negative impact than a positive one" on airlines.

After the Brexit, "it's not really a question of who will be benefited the most but really more of a question who's going to be negatively impacted the least," Keay added.

Shares of United Continental are up by 4.88% to $40.85 on Wednesday afternoon. 

Separately, TheStreet Ratings team rates United Continental as a "buy" with a ratings score of B-. 

This is driven by a number of strengths, which TheStreet Ratings believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks TheStreet Ratings covers. The company's strengths can be seen in multiple areas, such as its notable return on equity and attractive valuation levels. TheStreet Ratings feels its strengths outweigh the fact that the company has had sub par growth in net income.

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: UAL

Image placeholder title