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SkyWest (SKYW) Q1 Earnings Miss Estimates, Load factor Tanks

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SkyWest, Inc.‘s (SKYW - Free Report) first-quarter 2020 earnings of 59 cents per share missed the Zacks Consensus Estimate of 88 cents. Also, the bottom line deteriorated 55.64% on a year-over-year basis primarily due to fall in demand in March 2020 stemming from the COVID-19 outbreak.

Quarterly revenues came in at $729.9 million, which beat the Zacks Consensus Estimate of $690 million. Moreover, the top line increased marginally year over year due to inclusion of 16 E175 aircrafts since first-quarter 2019.

Revenues from flying agreements (contributing 97.2% to the top line) inched up 1.35% from the year-ago quarter’s figure. Total expenses rose 5.8% to $663.6 million due to higher aircraft maintenance, materials and repairs as well as depreciation and amortization costs. The carrier reported a 2.2% increase in block hours (a measure of aircraft utilization) during the reported quarter. Passenger load factor (percentage of seats filled by passengers) deteriorated 111 basis points to 67.5% in the reported quarter due to shrink in air travel demand thanks to the pandemic.

SkyWest Inc Price, Consensus and EPS Surprise


SkyWest Inc Price, Consensus and EPS Surprise

SkyWest Inc price-consensus-eps-surprise-chart | SkyWest Inc Quote



The company, carrying a Zacks Rank #5 (Strong Sell), exited the first quarter with cash and marketable securities of $578 million, up from $520 million at 2019 end.  Long-term debt (net of current maturities) fell 3.8% year over year to $2.5 billion.

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

The company used $20 million to repurchase stock during first-quarter 2020.

Sectorial Snapshot

Unlike SkyWest, there are a few companies in the Zacks Transportation sector like Werner Enterprises, Inc. (WERN - Free Report) , Union Pacific Corporation (UNP - Free Report) and Canadian Pacific Railway Limited (CP - Free Report) that have surpassed earnings estimates in first-quarter 2020.

Werner Enterprises reported first-quarter 2020 earnings per share (excluding 7 cents from non-recurring items) of 40 cents, which surpassed the Zacks Consensus Estimate of 35 cents. However, the bottom line declined 23.1% year over year.

Union Pacific’s first-quarter 2020 earnings of $2.15 per share surpassed the Zacks Consensus Estimate of $1.86. Moreover, the bottom line increased 11.4% on a year-over-year basis.

Canadian Pacific’s first-quarter 2020 earnings (excluding $1.08 from non-recurring items) of $3.3 (C$4.42) per share surpassed the Zacks Consensus Estimate of $2.86. Quarterly earnings surged more than 55% year over year.

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