Back to top

Image: Shutterstock

Atlas Air (AAWW) to Report Q4 Earnings: A Beat in the Offing?

Read MoreHide Full Article

Atlas Air Worldwide Holdings  is scheduled to report fourth-quarter 2021 results on Feb 17, before market open.

Atlas Air has a stellar surprise record with its earnings having topped the Zacks Consensus Estimate in each of the last four quarters, the average being 34.31%. 

The Zacks Consensus Estimate for fourth-quarter 2021 earnings has been revised 2% upward over the past 60 days.

Against this backdrop, let’s discuss the factors that might have impacted Atlas Air’s performance in the December quarter.

We expect Atlas Air’s fourth-quarter 2021 performance to have been aided by the uptick in economic activities, despite the omicron-induced disruptions. Exponential e-commerce growth is likely to have boosted airfreight demand.

Driven by this healthy demand scenario, revenues from airline operations, which contribute to the bulk of the top line, are likely to have increased in the fourth quarter. Evidently, the Zacks Consensus Estimate for revenues from airline operations in fourth-quarter 2021 indicates an 8.3% improvement from the third quarter’s reported figure.

However, escalated fuel costs are likely to have affected the bottom line in the to-be-reported quarter with oil price moving north. The Zacks Consensus Estimate for aircraft fuel expense in fourth-quarter 2021 indicates a 67.2% rise from the fourth-quarter 2020 reported level.

What Does the Zacks Model Say?

Our proven model predicts an earnings beat for Atlas Air this time around. The combination of a positive  Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here as elaborated below. You can see  the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Atlas Air has an Earnings ESP of +3.11% as the Most Accurate Estimate is 19 cents above the Zacks Consensus Estimate of $6.11. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Atlas Air currently sports a Zacks Rank of 1.

Highlights of Q3 Earnings

Atlas Air's third-quarter earnings (excluding 97 cents from non-recurring items) of $4.88 per share surpassed the Zacks Consensus Estimate of $4.12. Total revenues of $1016.1 million surpassed the Zacks Consensus Estimate of $999.7 million

Other Stocks to Consider

Investors interested in the broader Transportation sector may also consider Eagle Bulk Shipping Inc. , Gol Linhas  and Expeditors International of Washington, Inc. (EXPD - Free Report) as these stocks possess the right combination of elements to beat on earnings this reporting cycle.

Eagle Bulk currently has an Earnings ESP of +25.88% and a Zacks Rank #3. Eagle Bulk will report fourth-quarter results on Mar 3.

Eagle Bulk’s shares have gained 90% in a year. EGLE has a trailing four-quarter earnings surprise of 33% (one miss and three beats), on average. Strong trading volumes are likely to have boosted EGLE’s performance in the to-be-reported quarter.

Gol Linhas currently has an Earnings ESP of +8.29% and a Zacks Rank of 3. GOL will report fourth-quarter results on Feb 17.

Gol Linhas’ fourth-quarter results are likely be boosted by improved air-travel demand in Brazil. Load factor (% of seats filled by passengers) is likely to have improved in the fourth quarter owing to upbeat traffic.

Expeditors has an Earnings ESP of +2.97% and is currently a #2 Ranked player. EXPD will release fourth-quarter 2021 results on Feb 22.

Uptick in airfreight revenues is aiding EXPD. Due to the coronavirus-induced imbalance between scheduled capacity and demand, EXPD is using charters to meet customer needs. Revenues from the airfreight services unit increased approximately 54% year over year in the first nine months of 2021.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Expeditors International of Washington, Inc. (EXPD) - free report >>

Published in