American Airlines Group (AAG) is generating strong and improving earnings and cash flow, boosted by synergies from the merger of AMR Corp. and US Airways Group in December 2013. We expect gradual improvement in AAG's credit measures, despite heavy capital expenditures and a recently announced shareholder rewards program. We are revising our rating outlooks on AAG and its subsidiaries American Airlines Inc. and US Airways Inc. to positive from stable and affirming our ratings on the companies, including the 'B' corporate credit ratings. The positive outlook reflects the potential for an upgrade if AAG sustains funds from operations to debt at least in the mid-teens percent area and debt to EBITDA below 4.5x, and the company continues to make progress
