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Allegiant (ALGT) May 2021 Traffic Up 172% From May 2020

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Allegiant Travel Company (ALGT - Free Report) reported impressive traffic numbers for the month of May as air-travel demand improved in the United States. With more and more Americans getting jabbed, the picture is rosier on a year-over-year basis.

Scheduled traffic (measured in revenue passenger miles) surged 172% from May 2020 levels. Capacity (measured in available seat miles) for scheduled service increased 87.3% from May 2020 readings.

With the traffic surge outweighing capacity expansion, load factor (% of seats filled by passengers) in May expanded 21.4 points to 68.7% from the year-ago period. For the total system (including scheduled service and fixed fee contract), Allegiant carried more passengers in May 2021, up 186.4% from the May 2020 levels.

Compared to May 2019 levels (pre-COVID), both traffic and capacity plunged 18.7% and 1.2%, respectively. Moreover, the load factor also tanked 14.9 points to 68.7% as decline in traffic was more than capacity contraction. For the total system, the airline carried 18.3% less passengers in May 2021 from May 2019 levels.

With oil prices shooting up, Allegiant is witnessing a rise in fuel cost per gallon. The metric, which was $1.90 in April, is estimated to have risen to $2.02 in May.

Besides, Allegiant expects its June loads to be in excess of 75% versus June 2019 levels with capacity increases of approximately 15%. Moreover, the carrier continues to expect its June-end quarters scheduled service revenue (excluding fixed fee and other revenue) to be down by 6-10%, from second-quarter 2019 levels.

Zacks Rank & Stocks to Consider

Allegiant currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Zacks Transportation sector include Landstar System, Inc. (LSTR - Free Report) , Triton International Limited (TRTN - Free Report) and Herc Holdings Inc. (HRI - Free Report) . Herc Holdings sports a Zacks Rank #1 (Strong Buy), while Triton and Landstar carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term (three to five years) expected earnings per share growth rate for Landstar, Triton and Herc Holdings is projected at 12%, 10% and 42.9%, respectively.

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