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Fleet-Upgrade Efforts and Shareholder-Friendly Moves Aid SkyWest

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Key Takeaways

  • SkyWest expands fleet via agreements with UAL, DAL, ALK and Embraer for new E175 deliveries.
  • By 2028-end, SkyWest is scheduled to have nearly 300 E175 aircraft.
  • Shareholder returns remain key, with $17.3M in Q2 buybacks and $267M still authorized.

SkyWest, Inc. (SKYW - Free Report) is poised to benefit from increased air travel demand and its associated fleet modernization initiatives. A solid balance sheet enables SKYW to consistently reward shareholders with share repurchases.

Let’s delve deeper into the factors favoring SKYW.

SkyWest's fleet-modernization efforts, to cater to the improvement in travel demand, are commendable. In a bid to modernize its fleet, SKYW has fleet-related agreements with major airlines, including United Airlines (UAL - Free Report) ), Delta Air Lines (DAL - Free Report) and Alaska Airlines (ALK - Free Report) .

Per a previously announced agreement with UAL, SkyWest took delivery of two new E175 aircraft during the second quarter of 2025. Further, UAL is scheduled to deliver five E175 planes in the remaining quarters of 2025 and eight in 2026. Alaska Airlines is scheduled to deliver one E175 in 2025.

With Delta Air Lines, SKYW has an inked multi-year flying contract to purchase and operate 16 new E175 aircraft. These 16 new E175 aircraft are anticipated to replace 11 CRJ900s and five CRJ700s, which are currently being flown by SKYW under contract with DAL. Additionally, DAL is scheduled to deliver 10 E175 planes in 2027 and six in 2028. 

Apart from deals with UAL, DAL and ALK, SkyWest is scheduled to purchase 16 E175s from Embraer, with delivery dates in 2027 and 2028. By 2028-end, SkyWest is scheduled to have nearly 300 E175 aircraft. 

Recently, SkyWest has signed a deal with Maeve Aerospace as an equity investor. Per the deal, SkyWest will lend its operations, performance and design expertise to Maeve Aerospace through the development phase. The agreement provides SkyWest with exclusive Maeve launch customer rights and enhances SKYW’s long-term strategy regarding fleet upgrades.

SkyWest’s solid balance sheet increases financial flexibility. The company ended second-quarter 2025 with cash and marketable securities of $727.02 million, higher than the current debt level of $490.53 million. This implies that the company has sufficient cash to meet its current debt obligations. Meanwhile, long-term debt level has decreased to $2.00 billion (which translates into a debt-to-capitalization of 49.2%) at the end of second-quarter 2025 from $2.28 billion (which translates into a debt-to-capitalization of 55.5%) at the end of second-quarter 2024.

A strong balance sheet enables the company to reward shareholders with share repurchases. As a reflection of its shareholder-friendly stance, in May 2025, SKYW's existing repurchase plan was increased by $250 million. SKYW repurchased 195,000 shares of common stock for $17.3 million during the second quarter of 2025. As of June 30, 2025, SkyWest had $267 million available under its current share repurchase program.

Buybacks not only reduce the total outstanding share count, thereby increasing earnings per share, but also signal management's belief in the intrinsic value of the stock.

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