NEW YORK (TheStreet) -- Shares of United Continental Holdings (UAL) are up 2.85% to $64.30 in pre-market trading after Barclays upgraded the airline today to "overweight" from "underweight" and raised its price target to $76 from $52.
"Airlines show 23% average upside potential on an aggressively conservative approach to modeling fuel benefits. Our upside case, which assumes fuel stays low through 2016 with much more limited revenue offset, shows about 65% upside to coverage," analysts said.
"Fundamentally, the U.S. airlines stand to see about $10 billion decline in fuel costs in our 2015 outlook. We can debate how much will flow fully to earnings, but the potential remains substantial put against our $14.5 billion pre-tax earnings estimate for 2014," analysts noted.
"If oil stays low, we think the industry would 'need' to grow fleet," analysts added.
Separately, TheStreet Ratings team rates UNITED CONTINENTAL HLDGS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate UNITED CONTINENTAL HLDGS INC (UAL) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."