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Here's Why You Should Hold SkyWest (SKYW) in Your Portfolio
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SkyWest, Inc. (SKYW - Free Report) performed well in the past year and has the potential to sustain the momentum in the future. If you have not taken advantage of its share price appreciation yet, it’s time to do so.
Against this backdrop, let’s look at the factors why investors should retain this stock now despite headwinds.
We are impressed by SKYW's efforts to reward its shareholders through share buybacks. Per its previously announced share repurchase program authorized by SKYW’s board of directors in May 2023, SKYW repurchased 1.0 million shares for $45 million during fourth-quarter 2023. For 2023, SkyWest repurchased 10.6 million shares for $289 million. As of Dec 31, 2023, SkyWest had $91 million available under its current share repurchase program. Such shareholder-friendly moves instill investor confidence and positively impacts the company's bottom line.
Notably, shares of SKYW have surged 196.9% in the past year, outperforming the industry’s12.7% growth.
Image Source: Zacks Investment Research
Further, SkyWest has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 128.02%.
SkyWest's fleet-modernization efforts are commendable. Concurrent with its fourth-quarter 2023 results, SKYW announced that it has acquired a 25% ownership stake in Contour Airlines, a Part 135 carrier. The Contour deal includes an asset provisioning agreement, per which SKYW will offer CRJ airframes, engines and rotatable parts to Contour. By 2026-end, SKYW is scheduled to operate 258 E175 aircraft.
On the flip side,a rise in operating expenses is likely to weigh on SKYW's bottom line. The company’s fourth-quarter 2023 operating expenses were $724 million, up 1% from the year-ago reported quarter. The upside was owing to an increase in employee compensation, which includes higher labor pay scales and increased maintenance costs, partially offset by lower aircraft rent expenses from the early lease buyouts on aircraft in the first quarter of 2023.
Air Lease has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 20.15%.
The Zacks Consensus Estimate for 2024 earnings has been revised 27.7% upward over the past 90 days. AL has an expected earnings growth rate of 29.96% for 2024. Shares of AL have gained 31.7% in the past year.
KEX has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 5.75%.
KEX has an expected earnings growth rate of 32.80% for 2024. Shares of KEX have gained 41.6% in the past year.
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Here's Why You Should Hold SkyWest (SKYW) in Your Portfolio
SkyWest, Inc. (SKYW - Free Report) performed well in the past year and has the potential to sustain the momentum in the future. If you have not taken advantage of its share price appreciation yet, it’s time to do so.
Against this backdrop, let’s look at the factors why investors should retain this stock now despite headwinds.
We are impressed by SKYW's efforts to reward its shareholders through share buybacks. Per its previously announced share repurchase program authorized by SKYW’s board of directors in May 2023, SKYW repurchased 1.0 million shares for $45 million during fourth-quarter 2023. For 2023, SkyWest repurchased 10.6 million shares for $289 million. As of Dec 31, 2023, SkyWest had $91 million available under its current share repurchase program. Such shareholder-friendly moves instill investor confidence and positively impacts the company's bottom line.
Notably, shares of SKYW have surged 196.9% in the past year, outperforming the industry’s12.7% growth.
Image Source: Zacks Investment Research
Further, SkyWest has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 128.02%.
SkyWest's fleet-modernization efforts are commendable. Concurrent with its fourth-quarter 2023 results, SKYW announced that it has acquired a 25% ownership stake in Contour Airlines, a Part 135 carrier. The Contour deal includes an asset provisioning agreement, per which SKYW will offer CRJ airframes, engines and rotatable parts to Contour. By 2026-end, SKYW is scheduled to operate 258 E175 aircraft.
On the flip side, a rise in operating expenses is likely to weigh on SKYW's bottom line. The company’s fourth-quarter 2023 operating expenses were $724 million, up 1% from the year-ago reported quarter. The upside was owing to an increase in employee compensation, which includes higher labor pay scales and increased maintenance costs, partially offset by lower aircraft rent expenses from the early lease buyouts on aircraft in the first quarter of 2023.
Zacks Rank and Stocks to Consider
SkyWest currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Zacks Transportation sector are Air Lease Corporation (AL - Free Report) and Kirby Corporation (KEX - Free Report) . Each stock presently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Air Lease has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 20.15%.
The Zacks Consensus Estimate for 2024 earnings has been revised 27.7% upward over the past 90 days. AL has an expected earnings growth rate of 29.96% for 2024. Shares of AL have gained 31.7% in the past year.
KEX has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 5.75%.
KEX has an expected earnings growth rate of 32.80% for 2024. Shares of KEX have gained 41.6% in the past year.