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Alaska Air Group (ALK) Stock Drops Despite Market Gains: Important Facts to Note

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Alaska Air Group (ALK - Free Report) closed the most recent trading day at $50.73, moving -2.39% from the previous trading session. This change lagged the S&P 500's daily gain of 0.62%. At the same time, the Dow added 0.99%, and the tech-heavy Nasdaq gained 0.65%.

The airline's shares have seen an increase of 5.65% over the last month, surpassing the Transportation sector's gain of 2.31% and the S&P 500's gain of 0.59%.

Analysts and investors alike will be keeping a close eye on the performance of Alaska Air Group in its upcoming earnings disclosure. The company is forecasted to report an EPS of $0.14, showcasing a 85.57% downward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $3.64 billion, indicating a 3.07% increase compared to the same quarter of the previous year.

ALK's full-year Zacks Consensus Estimates are calling for earnings of $2.17 per share and revenue of $14.25 billion. These results would represent year-over-year changes of -55.44% and 0%, respectively.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Alaska Air Group. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.69% higher. Currently, Alaska Air Group is carrying a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Alaska Air Group has a Forward P/E ratio of 10.62 right now. This signifies a premium in comparison to the average Forward P/E of 9.77 for its industry.

One should further note that ALK currently holds a PEG ratio of 0.52. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Transportation - Airline stocks are, on average, holding a PEG ratio of 0.64 based on yesterday's closing prices.

The Transportation - Airline industry is part of the Transportation sector. Currently, this industry holds a Zacks Industry Rank of 175, positioning it in the bottom 29% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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