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Atlas Air (AAWW) to Report Q4 Earnings: What's in Store?

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Zacks Equity Research
·4 min read
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Atlas Air Worldwide Holdings AAWW is scheduled to report fourth-quarter 2020 results on Feb 18, before market open.

The company has a stellar surprise record with its earnings having outshined the Zacks Consensus Estimate in each of the last four quarters, the average being in excess of 100%.

Atlas Air Worldwide Holdings Price and EPS Surprise

Atlas Air Worldwide Holdings Price and EPS Surprise
Atlas Air Worldwide Holdings Price and EPS Surprise

Atlas Air Worldwide Holdings price-eps-surprise | Atlas Air Worldwide Holdings Quote

Moreover, the Zacks Consensus Estimate for fourth-quarter earnings has been stable at $3.29 per share in the past 60 days.

Against this backdrop, let’s take a look at the factors that might have impacted the company’s December-quarter performance.

We expect Atlas Air’s fourth-quarter performance to have been buoyed by upbeat airfreight demand despite the current turbulent scenario. In a bid to match this demand uptick, the company made adjustments to its fleet.

Moreover, fourth-quarter results are likely to benefit from higher commercial charter yields. Notably, the Zacks Consensus Estimate for direct contribution from the charter segment suggests an increase of more than 100% from the figure reported in fourth-quarter 2019.

Additionally, moderate fuel costs are likely to have aided the bottom line in the to-be-reported quarter. Notably, the Zacks Consensus Estimate for aircraft fuel expenses implies a 14.4% decline from the prior-year quarter’s reported number.

However, revenues from the ACMI segment are likely to have been higher from the third quarter of 2020 in the to-be-reported quarter owing to an uptick in the average revenue per block hour and increased flying. Notably, the Zacks Consensus Estimate for ACMI segment’s revenues is pegged at a 3% decrease from the reported figure in third-quarter 2020. Similarly, the same indicates a 14.3% decline from the figure reported in fourth-quarter 2019.

What Does the Zacks Model Say?

Our proven Zacks model does not predict an earnings beat for Atlas Air this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, this is not the case here as illustrated below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Atlas Air has an Earnings ESP of 0.00% as the Most Accurate Estimate of $3.29 is in line with the Zacks Consensus Estimate.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Atlas Air carries a Zacks Rank #3, currently.

Highlights of Q3 Earnings

In the last reported quarter, the company reported earnings per share (excluding 6 cents from non-recurring items) of $2.84, surpassing the Zacks Consensus Estimate of $2.34. Revenues too increased 24.1% to $809.9 million from the year-ago quarter. The top line also surpassed the Zacks Consensus Estimate of $792.1 million.

Stocks to Consider

Investors interested in the broader Transportation sector may consider Golar LNG Limited GLNG, Herc Holdings Inc. HRI and Expeditors International of Washington EXPD as these stocks possess the right combination of elements to beat on earnings this reporting cycle.

Golar LNG has an Earnings ESP of +50.00% and a Zacks Rank of 3 currently. The company will release fourth-quarter earnings on Feb 25.

Herc Holdings has an Earnings ESP of +9.63% and a Zacks Rank #2, presently. The company will announce fourth-quarter results on Feb 18.

Expeditors has an Earnings ESP of +0.32% and is currently Zacks #3 Ranked. The company is set to release fourth-quarter results on Feb 16.

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Expeditors International of Washington, Inc. (EXPD) : Free Stock Analysis Report

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Atlas Air Worldwide Holdings (AAWW) : Free Stock Analysis Report

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