If you booked a spring flight and felt like prices were higher than last year, you weren't imagining things. And according to Bank of America, those higher fares aren't going away anytime soon.

BofA analyst Andrew G. Didora has turned more optimistic on U.S. airlines ahead of second-quarter earnings, raising price targets across the sector. The reasoning is straightforward: demand is strong, fares that went up this spring have mostly stuck, and summer capacity looks stable enough to keep unit revenue humming through the third quarter. Oh, and fuel prices are lower, which never hurts.

But before you go all-in on airline stocks, Didora offers a word of caution: fourth-quarter capacity growth could pick up, potentially eating into unit revenue gains later in the year. So the window of opportunity might be more about the near term.

Here's how BofA sees the major carriers shaking out.

Buy-Rated Network Carriers: Delta, United, Alaska

Delta: Pricing Power Supports Buy Rating

BofA reiterated a Buy on Delta Air Lines (DAL) and raised its price target to $100 from $93. The firm sees Delta benefiting from its mix of premium and corporate travelers, strong margins, and solid free cash flow. Third-quarter unit revenue should accelerate as bookings reflect those higher fares.

United's Margin Expansion Path Stands Out

United Airlines (UAL) also gets a Buy, with the price target bumped to $150 from $145. BofA highlights United's strong industry position, healthy margins, and room for further margin expansion. Third-quarter unit revenue and costs are both expected to rise, driven by strong demand and fare increases.

Alaska: Valuation Offsets Hawaii Pressure

Alaska Air Group (ALK) keeps its Buy rating, with the target raised to $65 from $60. Despite near-term fuel pressure, BofA raised its 2026 EPS forecast to $1.04, citing Alaska's premium exposure, international growth, and attractive valuation as support.

Neutral Ratings: American, Allegiant

American: Leverage Keeps Rating Neutral

American Airlines (AAL) stays at Neutral, with the price target raised to $19 from $16. BofA notes that American faces higher earnings volatility due to its leverage. While demand and pricing are improving, lower margins, higher leverage, and weaker free cash flow keep it behind other network carriers.

Allegiant: Demand Strength Meets Deal Risk

Allegiant Travel (ALGT) also remains Neutral, with the target raised to $120 from $100. Stronger demand and lower fuel costs support the outlook, but the risk associated with integrating Sun Country limits upside potential.

Underperform Ratings: Southwest, JetBlue, Frontier

Southwest: Execution Risk Weighs

Southwest Airlines (LUV) gets an Underperform rating, though the price target was raised to $45 from $40. BofA says Southwest should benefit from healthy demand and firm pricing, but its business transformation introduces execution risk as initiatives hit their third-quarter run rate.

JetBlue: Leverage Keeps BofA Cautious

JetBlue Airways (JBLU) is also Underperform, with the target raised to $4 from $3.50. JetBlue should benefit from Spirit's exit and healthy demand, but rising second-half capacity, weak earnings, and high leverage keep the firm cautious.

Frontier: Margin Profile Limits Upside

Frontier Group (ULCC) rounds out the Underperform list, with the target raised to $4 from $3.50. Lower fuel costs and utilization-driven capacity growth are positives, but Frontier's weaker margin profile keeps BofA on the sidelines.

Price Action: At the time of publication Wednesday, DAL shares were trading higher by 0.41% at $94.04, UAL by 0.22% at $136.01, AAL by 1.36% at $18.32, ALGT by 3.29% at $121.47, JBLU by 1.40% at $5.81 and ULCC by 0.06% at $7.92, while ALK slipped 0.48% to $52.18 and LUV fell 1.22% to $50.79.

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