United Airlines' stock experienced a surge recently, reflecting the dynamic and frothy landscape of the travel industry. This boost followed the release of a strong quarterly earnings report coupled with multiple analyst price target increases. By the end of last week, United Airlines' shares had appreciated nearly 19% based on data from S&P Global Market Intelligence. While initially, a less than 3% year-over-year revenue growth and declining non-GAAP profitability might not seem impressive, stock performance is often driven by expectations rather than just raw figures.

United surpassed analyst predictions, prompting investors to eagerly acquire its stock. A contributing factor to this enthusiasm was the announcement of a new stock buyback program, potentially expanding to $1.5 billion. Importantly, many analysts seemed unperturbed by the company's modest financial growth or profit decline. Following the earnings report, several analysts raised their price targets for United. Notably, Helane Becker of TD Cowen revised her fair value assessment of United stock to $100 per share, up from $80, maintaining a buy recommendation.

Her optimism stems from United's recovering corporate business, its growing international presence, and gains in domestic market share. Despite this excitement, there's a note of caution. One might argue United’s recent performance and future outlook aren’t particularly ground-breaking. The airline industry is inherently high-cost and fiercely competitive, which remains a challenge even during prosperous times. Given these factors, investors might consider adopting a careful approach towards United and similar airline stocks amidst the current market enthusiasm.