Just caught something interesting with AAL this morning. The stock popped 2.26% while the broader market only gained around 0.64%, so airline stocks are showing some real strength lately. Over the past month, AAL climbed 4.52%, which actually beat out the transportation sector's 4.41% gain. Not bad for a sector that usually gets beat up.

What caught my eye though is the valuation. Trading at a forward P/E of 7.81 compared to the industry average of 9.3, so there's some discount pricing happening here. The PEG ratio sitting at 0.61 also looks reasonable relative to the sector average of 0.6. Earnings are coming up and they're expecting $0.38 per share, which would be down 55% year-over-year, but revenue is projected at $14.12 billion with a 3.35% bump.

Looking at the bigger picture, the Transportation sector as a whole ranks in the top 43% of industries right now. So while airline stocks down is the narrative you hear sometimes, there's actually some interesting value plays emerging if you dig into the individual names. AAL's sitting on a Hold rating currently, but the recent estimate revisions have been moving in the right direction. Worth keeping on the watchlist if you're looking at cyclical plays.