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Airline Stock Roundup: Q3 Earnings Results From ALGT, SKYW & SAVE, JBLU in Focus

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·4 min read
In this article:
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  • JBLU
  • SKYW
  • ALGT
  • RYAAY
  • SAVE

In the past week, U.S. carriers, such as SkyWest SKYW, Allegiant Travel Company ALGT and Spirit Airlines SAVE released their respective third-quarter 2021 earnings reports. European low-cost carrier Ryanair Holdings RYAAY also grabbed headlines on the earnings front, releasing its second-quarter fiscal 2022 (ended Sep 30, 2021) earnings report. While the top line benefited from increased traffic at all the above carriers, high fuel price per gallon hurt the bottom line.

We remind investors that the third-quarter earnings reports of the likes of Southwest Airlines LUV and American Airlines AAL were discussed in detail in the previous week’s write up. On the non-earnings front, JetBlue Airways’ JBLU decision to expand its codeshare agreement with Iceland’s Icelandair dominated headlines.

Recap of the Latest Key Events

1. SkyWest’s third-quarter 2021 earnings (excluding $1.26 from non-recurring items) of $1.45 per share surpassed the Zacks Consensus Estimate of 94 cents. The bottom line increased significantly on a year-over-year basis, reflecting the recovery in air-travel demand. Revenues of $744.8 million also outperformed the Zacks Consensus Estimate of $674 million. The top line jumped 63% year over year owing to a 67% increase in block hours on completed flights.

SkyWest currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

2. Spirit Airlines’ third-quarter 2021 loss (excluding 83 cents from non-recurring items) of 69 cents per share was narrower than the Zacks Consensus Estimate of a loss of 95 cents and the year-ago loss of $2.32. Operating revenues of $922.6 million increased in excess of 100% year over year. This massive year-over-year jump reflects improving air-travel demand as COVID-19 cases fall and the threat of the Delta variant recedes in the United States. Revenues increased 7.4%, sequentially. Average fuel cost per gallon in the September quarter rose to $2.14 from $1.27 as oil price shoots up.

3. Allegiant’s third-quarter 2021 earnings (excluding $1.52 from non-recurring items) of 66 cents per share missed the Zacks Consensus Estimate of 70 cents. However, the bottom line surged more than 100% on a year-over-year basis. Sentiments regarding air-travel demand are bullish now (owing to increased inoculation programs) compared with the year-ago quarter when the company reported a loss of $4.28 per share. Operating revenues of $459.5 million beat the Zacks Consensus Estimate of $446.1 million and increased more than 100% on a year-over-year basis. Average fuel cost per gallon (scheduled) surged 66.7% to $2.20 in the quarter.

4. Ryanair reported second-quarter fiscal 2022 (ended Sep 30, 2021) earnings of $1.16 per share, which fell short of the Zacks Consensus Estimate of $1.80. In the year-ago period, the company incurred an adjusted loss of 12 cents per share due to coronavirus-led weakness in air-travel demand. Quarterly revenues of $2,104 million in the second quarter of fiscal 2022 fell shy of the Zacks Consensus Estimate of $2,338.8 million. The top line increased significantly year over year with improvement in traffic, courtesy of the rollout of the EU Digital Covid Certificates. Easing of coronavirus-led travel restrictions also drove traffic. The airline’s fuel and oil expenses increased 67% year over year, partly due to higher jet fuel prices.

5. In a bid to boost connectivity, JetBlue expanded its codeshare deal with Icelandair. The agreement offers customers multiple ways to book and connect their travel between JetBlue and Icelandair’s networks across Europe and North America. A codeshare deal enables flight sharing, by dint of which a passenger has the free will to avail any flight operated by either of the companies under the agreement, irrespective of the flight number. With international travel demand gradually rising as countries reopen their borders to vaccinated travelers, the expanded codeshare agreement should help drive traffic for JetBlue.

Performance

The following table shows the price movement of the major airline players over the past week and during the last six months.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

What's Next in the Airline Space?

Investors will look forward to the October traffic reports of the likes of Gol Linhas GOL in the coming days.


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Ryanair Holdings PLC (RYAAY) : Free Stock Analysis Report

Southwest Airlines Co. (LUV) : Free Stock Analysis Report

JetBlue Airways Corporation (JBLU) : Free Stock Analysis Report

Gol Linhas Aereas Inteligentes S.A. (GOL) : Free Stock Analysis Report

American Airlines Group Inc. (AAL) : Free Stock Analysis Report

Spirit Airlines, Inc. (SAVE) : Free Stock Analysis Report

Allegiant Travel Company (ALGT) : Free Stock Analysis Report

SkyWest, Inc. (SKYW) : Free Stock Analysis Report

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Zacks Investment Research