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Allegiant (ALGT) Q2 Earnings and Revenues Beat Estimates

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Allegiant Travel Company (ALGT - Free Report) reported second-quarter earnings of $3.10 per share, which beat the Zacks Consensus Estimate of $2.66. The bottom line improved on a year-over-year basis despite high fuel costs.

Quarterly revenues increased 8.7% year over year to $436.8 million, marginally surpassing the Zacks Consensus Estimate of $436.5 million. Moreover, the top line was primarily driven by a 10.4% rise in passenger revenues. However, revenues were adversely affected due to late deliveries in May.

In the first half of 2018, Allegiant rewarded shareholders with dividend worth $22 million. As of Jul 25, 2018, the company has a share repurchase authorization of $100 million.

Furthermore, the company’s board has cleared a dividend of 70 cents per share, payable Aug 31, to shareholders of record as of Aug 17.

Systemwide air traffic (measured in revenue passenger miles) in the quarter under review rose 10.7% and capacity (measured in available seat miles) increased 9.4% year over year. Load factor (percentage of seats filled by passengers) was 83.5%, up 90 basis points, as capacity expansion was outweighed by traffic growth.

Cost per available seat miles (CASM) excluding fuel fell 5%. Total scheduled service revenue per available seat miles (TRASM) also inched up 0.5% to 11.15 cents.

Allegiant Travel Company Price, Consensus and EPS Surprise

 

Allegiant Travel Company Price, Consensus and EPS Surprise | Allegiant Travel Company Quote

Q3 Outlook

Scheduled and system ASMs in the quarter are expected to increase between 13% and 15% compared with the prior-year quarter’s tally.

Revised 2018 Outlook

The company expects fuel cost per gallon of $2.35 for 2018. The previous forecast for the metric was $2.20 per gallon. Additionally, effective tax rate is now anticipated between 21% and 22%, unchanged from the prior guidance. Further, projection for capital expenditures is unchanged at $300 million. System capacity is likely to increase between 9% and 11%. The previous forecast for this metric was 11%-15%.

The company expects earnings per share in the band of $9-$10 for the current year, lower than the previous guidance of $10-$12. The Zacks Consensus Estimate for 2018 bottom line is pegged at $10.56. This Zacks Rank #5 (Strong Sell) company lowered 2018 earnings per share outlook primarily due to rising fuel costs.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Investors interested in the broader Transportation Sector are awaiting second-quarter 2018 earnings reports from key players, namely Genesee & Wyoming Inc. , C.H. Robinson Worldwide, Inc. (CHRW - Free Report) and Expeditors International of Washington, Inc. (EXPD - Free Report) . Genesee & Wyoming will release results on Jul 27. C.H. Robinson and Expeditors will announce the same on Jul 31 and Aug 7, respectively.

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