October 8, 2007 - AMR's Long-Trm Solution Needs to Gain Some Altitude

Investors should be cautious about AMR (American Airlines) stock despite its recent list in price. The world's largest airline by traffic is setting a slower recovery pace than its competitors. The CEO is adhering to long-term strategy that often eschews short-term, investor pleasing fixes. Now, investments to improve operations for the long haul, including better customer service and new aircraft interiors, are adding to the carrier's high costs. Most airline stocks have been hurt in recent months by soaring energy prices, but shares of MAR have been battered more than others.