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Is SkyWest, Inc. (NASDAQ:SKYW) Potentially Underrated?

Simply Wall St

SkyWest, Inc. (NASDAQ:SKYW) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of SKYW, it is a dependable dividend-paying company that has been a rockstar for income investors, currently trading at an attractive share price. Below is a brief commentary on these key aspects. For those interested in digging a bit deeper into my commentary, take a look at the report on SkyWest here.

Undervalued average dividend payer

SKYW's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. Investors have the opportunity to buy into the stock to reap capital gains, if SKYW's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the airlines industry, SKYW is also trading below its peers, relative to earnings generated. This further reaffirms that SKYW is potentially undervalued.

NasdaqGS:SKYW Price Estimation Relative to Market, August 16th 2019

SKYW is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.

NasdaqGS:SKYW Historical Dividend Yield, August 16th 2019

Next Steps:

For SkyWest, I've compiled three essential factors you should further research:

  1. Future Outlook: What are well-informed industry analysts predicting for SKYW’s future growth? Take a look at our free research report of analyst consensus for SKYW’s outlook.
  2. Historical Performance: What has SKYW's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of SKYW? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.