The upcoming first and second results for North American Airline stocks could draw investor support should the quarterly results suggest point to a bottom forming following recent weakness, Morgan Stanley analysts said in a Monday note.

If the airlines' normalized EPS remain relatively unchanged, the "Q1 and Q2 reset in numbers should be a clearing event that draws a bid for the stocks," the analysts said. However, if Q2 guidance goes beyond "we have no idea" and into "we are seeing active demand destruction even in peak season" territory, the stocks have more room for downside, back to their August lows (at least).

Items to keep under watch include revenue per available seat mile, or RASM, especially in Q2, capacity plans, offsetting cost actions and idiosyncratic updates, Morgan Stanley said.

Investors, who missed out the prior rally in these stocks, are likely waiting for another opportunity to buy on weakness.

"Any investors we spoke with in December/January rued missing the 100%+ rally in the stocks between August-January and see this de-grossing event as an opportunity buy the stocks well below their highs again," the analysts added.

The analysts' outlook on airline stocks have been hurt by severe winter weather in February, multiple high-profile risk events and macro headline uncertainty. This has also been reflected in the messaging from the airlines, which are trying to stop panicked selling of the stocks, the analysts said.

The bank has lowered its price targets on Alaska Air Group Inc (ALK.N) to $85 from $90; Allegiant Travel (ALGT.O) to $93 from $95; American Airlines Group Inc (AAL.O) to $20 from $22; Delta Airlines, Inc. (DAL.N) to $95 from $100; United Airlines Holdings, Inc. (UAL.O) to $130 from $140; Southwest Airlines Co. (LUV.N) to $41 from $42; and Sun Country Airlines Holdings Inc (SNCY.O) to $21 from $22.

Price: 44.03, Change: -0.42, Percent Change: -0.94