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Allegiant Travel's (ALGT) Q4 Earnings Miss Estimates, Up Y/Y

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Allegiant Travel Company ALGT reported fourth-quarter 2019 earnings of $3.72 per share, which fell short off the Zacks Consensus Estimate of $3.87. However, the bottom line rose 45.3% year over year, driven by lower fuel costs and higher revenues. Total operating revenues increased 11.9% year over year to $461.1 million on the back of a 10.8% rise in passenger revenues. Moreover, the top line surpassed the consensus mark of $460.2 million.

Notably, quarterly earnings (airline operations) increased to $4.04 per share.

Allegiant Travel Company Price, Consensus and EPS Surprise

 

Allegiant Travel Company Price, Consensus and EPS Surprise

Allegiant Travel Company price-consensus-eps-surprise-chart | Allegiant Travel Company Quote

 

Quarter in Details

Air traffic (measured in revenue passenger miles or RPMs) for scheduled service rose 8% in the quarter under review. Capacity (measured in available seat miles or ASMs) increased 8.3% year over year. Load factor (percentage of seats filled by passengers) was 82.1%, down 20 basis points as capacity expansion outweighed traffic growth.

Airline operating cost per available seat miles (CASM) excluding fuel fell 1.5%. Average fuel cost per gallon (scheduled) declined 6.4% to $2.18 in the quarter. Moreover, total scheduled service passenger revenue per available seat miles (TRASM) increased 2.5% to 11.57 cents.

In the quarter under review, Allegiant rewarded shareholders with dividends worth $11 million. Notably, the company has roughly $85 million remaining under its current buyback program. Furthermore, the board of directors has cleared a quarterly dividend of 70 cents per share, which is payable on Mar 12, 2020, to shareholders of record as of Mar 2.

2020 Outlook

The company continues to expect scheduled and system ASMs to increase between 10% and 12% each. Allegiant Travel anticipates non-fuel unit costs (airline) to either remain flat or decline up to 2%.

The company now expects fuel cost per gallon of $2.15 (old guidance: $2.12). Additionally, the effective tax rate is anticipated between 23% and 24%.

This Zacks Rank #3 (Hold) company still expects earnings per share between $16.5 and$19 for the current year.  The mid-point of the guided range ($17.75 per share) is above the Zacks Consensus Estimate of $17.09.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Investors interested in the broader Transportation sector are awaiting fourth-quarter 2019 earnings reports from key players like Air Lease Corporation AL , Expeditors International of Washington EXPD and Hertz Global Holdings .

Air Lease and Expeditors will announce results on Feb 14 and Feb 18, respectively. Hertz will release fourth-quarter earnings on Feb 24.

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