Billionaire David Tepper’s 5 Small and Midcap Stock Picks with Huge Upside Potential

3. American Airlines Group Inc. (NASDAQ:AAL)

Appaloosa Management LP’s Stake: $217 Million  

American Airlines Group Inc. (NASDAQ:AAL) has had a stop-start relationship with Appaloosa Management LP. The fund first disclosed a stake in the company back in the fourth quarter of 2013. This position comprised nearly 7 million shares and was increased to more than 11.6 million shares by the second quarter of 2014. In the following quarters, this holding was trimmed and sold off completely by early 2015. A new position was opened in the firm in the third quarter of 2025. This holding comprised 9.2 million shares. In the fourth quarter of 2025, the fund increased this by more than 52% to 14.1 million shares.

The most significant driver for institutional interest in American Airlines Group Inc. (NASDAQ:AAL)  stock is the aggressive focus on fixing the balance sheet. The company has committed to reducing its total debt by approximately $15 billion from its peak levels. As of April 2026, it has already cleared a significant portion of this goal. As debt decreases, the equity value of the company typically increases, leading to significant stock price appreciation. Institutional investors are also optimistic about American’s shift toward higher-margin revenue streams. The airline is increasing its premium seating capacity by 20%, aiming to capture higher-paying business and luxury travelers who are less price-sensitive. Management has projected roughly $1 billion in steady-state cost savings, excluding fuel, through operational excellence and better fleet utilization.