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Shares of Allegiant Travel Company (ALGT - Free Report) have performed disappointingly so far this year. The stock has declined 20.1% compared to its industry’s gain of 13.8% on a year-to-date basis.
In fact, the stock price received another blow after the company based in Las Vegas, NV, gave a lacklustre performance on the bottom-line front in the reported quarter. Notably, its earnings of $2.94 per share missed the Zacks Consensus Estimate by 2 cents. Moreover, earnings declined 20.11% from the year-ago figure due to higher costs. Consequently, this disappointed investors and shares started losing value. Evidently, the stock declined 7.93% on Jul 27 to close the day’s trading session at $131.85 per share.
Quarterly revenues, however, increased 16.2% year over year to $400.6 million, edging past the Zacks Consensus Estimate of $399.8 million. Network growth aided the top line. During the quarter, Allegiant paid $84 million to shareholders through a combination of dividends and buybacks. Moreover, its board of directors increased the share repurchase authorization to $100 million.
Air traffic (measured in revenue passenger miles) in the reported quarter rose 11% year over year and capacity (measured in available seat miles) grew 12.7%. Load factor (percentage of seats filled by passengers) was 82.6%, down 130 basis points, as capacity expansion outweighed travel growth. Total revenue per available seat miles (TRASM) improved 3.1% aided by the shift of Easter into April.
Cost per available seat miles (CASM), excluding fuel, increased 13.2% in the reported quarter driven by the labor deals inked by the company that led to a spike in labor costs. In fact, the new pilot agreement contributed to the increase in the metric.
Allegiant Travel Company Price, Consensus and EPS Surprise
For the third quarter of 2017, this Zacks Rank #3 (Hold) company expects the metric to grow 16–18%. In fact, Allegiant anticipates the increase in CASM to be primarily driven by the implementation of the new pilot agreement. The metric is still expected to increase in the band of 10% to 12% for full-year 2017. Also, TRASM for the third quarter is anticipated in the band of -0.5%–1.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Investors interested in the broader Transportation space are keenly waiting for second-quarter earnings reports from key players like GOL Linhas , Copa Holdings, S.A. (CPA - Free Report) and Air Lease Corp. (AL - Free Report) . While GOL Linhas and Copa Holdings will report second-quarter results on Aug 9, Air Lease will report the same on Aug 3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Allegiant (ALGT) Misses Q2 Earnings Estimates, Stock Falls
Shares of Allegiant Travel Company (ALGT - Free Report) have performed disappointingly so far this year. The stock has declined 20.1% compared to its industry’s gain of 13.8% on a year-to-date basis.
In fact, the stock price received another blow after the company based in Las Vegas, NV, gave a lacklustre performance on the bottom-line front in the reported quarter. Notably, its earnings of $2.94 per share missed the Zacks Consensus Estimate by 2 cents. Moreover, earnings declined 20.11% from the year-ago figure due to higher costs. Consequently, this disappointed investors and shares started losing value. Evidently, the stock declined 7.93% on Jul 27 to close the day’s trading session at $131.85 per share.
Quarterly revenues, however, increased 16.2% year over year to $400.6 million, edging past the Zacks Consensus Estimate of $399.8 million. Network growth aided the top line. During the quarter, Allegiant paid $84 million to shareholders through a combination of dividends and buybacks. Moreover, its board of directors increased the share repurchase authorization to $100 million.
Air traffic (measured in revenue passenger miles) in the reported quarter rose 11% year over year and capacity (measured in available seat miles) grew 12.7%. Load factor (percentage of seats filled by passengers) was 82.6%, down 130 basis points, as capacity expansion outweighed travel growth. Total revenue per available seat miles (TRASM) improved 3.1% aided by the shift of Easter into April.
Cost per available seat miles (CASM), excluding fuel, increased 13.2% in the reported quarter driven by the labor deals inked by the company that led to a spike in labor costs. In fact, the new pilot agreement contributed to the increase in the metric.
Allegiant Travel Company Price, Consensus and EPS Surprise
Allegiant Travel Company Price, Consensus and EPS Surprise | Allegiant Travel Company Quote
Guidance
For the third quarter of 2017, this Zacks Rank #3 (Hold) company expects the metric to grow 16–18%. In fact, Allegiant anticipates the increase in CASM to be primarily driven by the implementation of the new pilot agreement. The metric is still expected to increase in the band of 10% to 12% for full-year 2017. Also, TRASM for the third quarter is anticipated in the band of -0.5%–1.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Investors interested in the broader Transportation space are keenly waiting for second-quarter earnings reports from key players like GOL Linhas , Copa Holdings, S.A. (CPA - Free Report) and Air Lease Corp. (AL - Free Report) . While GOL Linhas and Copa Holdings will report second-quarter results on Aug 9, Air Lease will report the same on Aug 3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>