A month has gone by since the last earnings report for Hawaiian Holdings (HA Quick QuoteHA - Free Report) . Shares have lost about 8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Hawaiian Holdings due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Wider-Than-Expected Loss in Q1

Hawaiian Holdings first-quarter 2022 loss (excluding 15 cents from non-recurring items) of $2.54 per share was wider than the Zacks Consensus Estimate of a loss of $2.51. HA reported a loss of $3.85 in the year-ago quarter.

Moreover, quarterly revenues of $477.2 million surged more than 100% year over year but missed the Zacks Consensus Estimate of $482.1 million.

Despite omicron-led crisis, passenger revenues (contributing 84.7% to the top line) surged 193.9% year over year to $404 million. Scheduled airline traffic, measured in revenue passenger miles, rose 182.2% year over year to 2,974.35 million in the quarter under review. Scheduled capacity (measured in available seat miles) increased 72% to 4,242.5 million. Load factor (percentage of seats filled by passengers) improved 2740 basis points to 70.1% in the reported quarter as traffic surge outweighed capacity expansion. Passenger revenue per ASM (PRASM) soared 70.9% to 9.52 cents.

Operating revenue per available seat mile (RASM: a key measure of unit revenues) in the quarter rose 52.5% year over year to 11.19 cents for total operations. Average fuel cost per gallon (economic) increased 78% to $2.83 in the first quarter. Gallons of jet fuel consumed surged 78.4% in the March quarter with more flights in operation.

Liquidity

As of Mar 31, 2022, Hawaiian Holdings’ unrestricted cash, cash equivalents and short-term investments totaled $1.6 billion. Outstanding debt and finance lease obligations were $1.9 billion.

Q2 Outlook

Capacity (or ASMs) is projected to decline 11.5-14.5% from second-quarter 2019 levels.  

Total revenues are anticipated to plunge 8-12% from second-quarter 2019 levels.

Costs per ASM (excluding fuel & non-recurring items) are expected to rise 16.5-19.5% from second-quarter 2019 numbers.  

Gallons of jet fuel consumed are expected to fall 14.5-17.5% from second-quarter 2019 level.

Adjusted EBITDA is expected between a negative $50 million and $10 million.

The effective tax rate is anticipated at 21% in the second quarter.

Fuel price per gallon is expected to be $3.59 in second-quarter 2022.

Suspended 2022 Outlook

HA withdrew its full-year guidance due to continued uncertainty surrounding the timing of the full resumption of its international network on account of foreign government travel restrictions.
 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

The consensus estimate has shifted -163.33% due to these changes.

VGM Scores

At this time, Hawaiian Holdings has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Hawaiian Holdings has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.