United is doubling down on its business class offerings - and that could be good news for investors

Hollis Johnson/Business Insider

• United is slowly adding to its fleet of business class cabins and lounges.
• The premium upgrade market is huge, and selling more to these customers could be good news for United's stock price, Credit Suisse said Friday.
• United's hubs in premium cities like San Francisco, New York, and Chicago should also help it fill the luxury seats.

United Airlines's business class - branded as Polaris - might be the best in the industry.

It's wowed Business Insider reviewers with everything from its posh airport lounges, to comfortable seats, and even luxury amenity kits. And now, Wall Street appears to be on board too.

In a note to clients Friday, Jose Calado, an analyst at Credit Suisse, said the company's premium push could be good news for the stock.

"With operational reliability on the mend, UAL is now going all-in with its premium push to carve out a greater slice of this highly lucrative market," he said. "Today UAL has an extremely competitive biz-class product (ground & onboard) with its Polaris concept, and is increasing supply to satisfy customer demand."

Read more: United Airlines is retrofitting its fleet for more high-fare travelers in a bid to take down Delta

Calado was already one of the most bullish analysts on the stock, and now he's raised his price target even further, to $113. At Friday's prices of $89 per share, that could reflect a 26% upside for shareholders.

"The focus on premium seating has been a successful strategy for DAL and is an important driver of its current revenue (and margin) premium," Calado said. "Considering that UAL's hub geography is skewed to even bigger premium markets (San Fran, LA, NYC, Chicago, Houston), these moves by United have the potential to close that revenue and margin premium over the long-run "

Credit Suisse isn't the only firm hoping premium offerings can help airlines eke out extra profits on their balance sheets.

Southwest, known for its open seating policy, could bring in an extra $1 of earnings per share per year if it were to change up its seating process. That's according to JPMorgan's Ryan Brinkman, who admitted earlier this month that while Southwest has said no changes are imminent to its famous policy, he's begun to "opine on the feasibility and potential profitability of seat monetization" at Southwest.

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