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Allegiant Travel Company (ALGT)
NASDAQ:ALGT
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Allegiant Travel Company
(NASDAQ:ALGT)
50Neutral
Positive Factors
Fleet Modernization
Allegiant took delivery of its first MAX aircraft, which offers a 26% improvement in fuel efficiency and potential to drive $2mm in incremental annualized EBITDA.
Revenue Growth
Revenue should benefit from growth in the Allegiant Extra product and regained functionality from the Navitaire cutover.
Stock Performance
The stock has rebounded significantly from its August lows, reflecting strong recovery momentum.
Negative Factors
Capacity Growth Concerns
The market may want more evidence to buy into Allegiant Travel's capacity growth despite guidance being ahead of consensus.
Hurricane Impact
Hurricane Helene will negatively impact the airline segment, affecting about 25% of network seats.
Operational Risks
There is risk that their plans to increase utilization do not pan out as intended and that RASM dilution may be worse than management expects.
Allegiant Travel Company (ALGT) vs. S&P 500 (SPY)
Market Cap
$842.09M
Dividend Yield5.67%
Average Volume (3M)531.14K
Price to Earnings (P/E)―
Beta (1Y)1.38
Revenue Growth0.11%
EPS Growth-311.73%
CountryUS
Employees6,691
SectorIndustrials
Sector Strength61
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)-13.38
Shares Outstanding18,338,274
10 Day Avg. Volume453,193
30 Day Avg. Volume531,139
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.40
Price to Cash Flow (P/CF)3.00
P/FCF Ratio2.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$64.33Price Target Upside27.79% Upside
Rating ConsensusHold
Number of Analyst Covering9
Allegiant Travel Company Business Overview & Revenue Model
Company DescriptionAllegiant Travel Company, a leisure travel company, provides travel services and products to residents of under-served cities in the United States. The company offers scheduled air transportation on limited-frequency, nonstop flights between under-served cities and leisure destinations. As of February 14, 2022, it operated a fleet of 110 Airbus A320 series aircraft. The company also provides air-related services and products in conjunction with air transportation, including baggage fees, advance seat assignments, travel protection products, priority boarding, a customer convenience fee, food and beverage purchases on board, and other air-related services, as well as use of its call center for purchases. In addition, it offers third party travel products, such as hotel rooms and ground transportation, such as rental cars and hotel shuttle products; and air transportation services through fixed fee agreements and charter service on a year-round and ad-hoc basis. Further, the company operates a golf course. Allegiant Travel Company was founded in 1997 and is based in Las Vegas, Nevada.
How the Company Makes MoneyAllegiant Travel Company generates revenue through several key streams. The primary source of income is from passenger fares, which are charged for air travel services. Additionally, the company earns significant revenue from ancillary fees, which include charges for baggage, seat selection, priority boarding, and other in-flight services. Allegiant also partners with hotels and car rental agencies to offer vacation packages, earning commissions and fees from these partnerships. By focusing on low-cost operations and targeting leisure travelers from underserved markets, Allegiant maximizes its earnings through a combination of airfare and ancillary revenue streams.
Allegiant Travel Company Financial Statement Overview
Summary
Allegiant Travel Company is facing challenging financial conditions. The income statement shows negative net income and EBIT despite revenue growth, indicating profitability issues. The balance sheet reveals high leverage risks with a substantial debt load, though some stability is maintained by a reasonable equity ratio. Cash flow management is improving, with positive operational cash flow and a shift from negative to positive free cash flow.Income Statement
The company has faced a challenging year with a negative net income and EBIT, reflecting operational difficulties. Despite a slight increase in total revenue, the significant decline in gross profit margin and negative net profit margin highlight profitability concerns. Historical comparisons show inconsistent performance, particularly in profitability metrics.40
Negative
Balance Sheet
The balance sheet reveals moderate financial stability with a substantial amount of debt. The debt-to-equity ratio is high, indicating potential leverage risks. However, the company maintains a reasonable equity ratio, showing some balance between liabilities and equity. The decline in stockholders' equity is a concern, reflecting potential risk in financial structure.55
Neutral
Cash Flow
Cash flow from operations remains positive, indicating operational cash generation despite net losses. The transition from negative to positive free cash flow is a positive sign, though it remains modest. The operating cash flow to net income ratio is not favorable given the negative net income, but cash management shows improvement.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.51B | 2.51B | 2.30B | 1.71B | 990.07M | Gross Profit |
| 1.57B | 664.37M | 340.47M | 231.54M | -4.34M | EBIT |
| -239.98M | 220.98M | -54.91M | 98.06M | -146.75M | EBITDA |
| 60.86M | 490.24M | 305.57M | 446.06M | -128.37M | Net Income Common Stockholders |
| -240.24M | 117.60M | 2.49M | 151.85M | -184.09M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 781.13M | 814.67M | 955.10M | 1.18B | 685.30M | Total Assets |
| 4.43B | 4.87B | 4.51B | 3.99B | 685.30M | Total Debt |
| 2.15B | 2.36B | 2.21B | 1.88B | 1.78B | Net Debt |
| 1.86B | 2.22B | 1.98B | 1.51B | 1.62B | Total Liabilities |
| 3.34B | 3.54B | 2.10B | 2.77B | -14.10M | Stockholders Equity |
| 1.09B | 1.33B | 1.22B | 1.22B | 699.40M |
| Cash Flow | Free Cash Flow | |||
| 38.30M | -447.39M | -131.64M | 232.66M | -45.70M | Operating Cash Flow |
| 338.46M | 423.09M | 303.05M | 488.20M | 234.50M | Investing Cash Flow |
| 5.58M | -721.88M | -491.42M | -593.28M | -365.69M | Financing Cash Flow |
| -201.30M | 212.92M | 33.12M | 285.47M | 164.60M |
Allegiant Travel Company Technical Analysis
Negative
50.34
Price Trends
69.01
Negative
78.79
Negative
64.82
Negative
Market Momentum
-6.09
Negative
28.34
Positive
24.63
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALGT, the sentiment is Negative. The current price of 50.34 is below the 20-day moving average (MA) of 52.28, below the 50-day MA of 69.01, and below the 200-day MA of 64.82, indicating a bearish trend. The MACD of -6.09 indicates Negative momentum. The RSI at 28.34 is Positive, neither overbought nor oversold. The STOCH value of 24.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALGT.
Allegiant Travel Company Risk Analysis
Allegiant Travel Company disclosed 30 risk factors in its most recent earnings report. Allegiant Travel Company reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Allegiant Travel Company Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $7.67B | 13.25 | 3.04% | 3.47% | 3.63% | -13.99% | |
60 Neutral | $549.12M | 10.02 | 9.75% | ― | 2.49% | -22.41% | |
59 Neutral | $590.71M | 4.64 | 41.49% | ― | -3.62% | 1459.83% | |
59 Neutral | $928.92M | 11.06 | 15.12% | ― | 5.18% | ― | |
50 Neutral | $842.09M | ― | -19.93% | 5.67% | 0.11% | -311.73% | |
42 Neutral | $1.44B | ― | -26.60% | ― | -3.50% | -148.99% | |
28 Underperform | $621.99M | ― | -2416.94% | ― | -36.80% | 96.50% |
* Industrials Sector Average
Performance Comparison
ALGT
Allegiant Travel Company
50.34
-11.16
-18.15%
JBLU
JetBlue Airways
4.29
-2.54
-37.19%
VLRS
Controladora Vuela Compania de Aviacion SAB de CV
5.08
-2.60
-33.85%
UP
Wheels Up Experience
0.89
-1.96
-68.77%
SNCY
Sun Country Airlines Holdings
11.65
-2.99
-20.42%
ULCC
Frontier Group Holdings
4.08
-2.86
-41.21%
Allegiant Travel Company Earnings Call Summary
Earnings Call Date: Feb 4, 2025 | % Change Since: -49.21% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with significant achievements in operational efficiency and financial discipline, balanced against challenges such as revenue declines and impairment charges related to Sunseeker. While operational and financial strategies show promise, the impact of certain headwinds, including foreign exchange and exceptional costs like the pilot bonus, were evident.Highlights
Improved Operating Margin
Adjusted airline-only operating margin of over 13% for the December quarter, marking a 6.5 point increase from the previous year.
Capacity and Utilization Growth
16% increase in December capacity with aircraft utilization averaging 9.6 hours per day, reflecting a 21% year-over-year increase.
Successful New Initiatives
Substantial progress in commercial technology upgrades and introduction of new MAX aircraft, with 46% of the fleet equipped with Allegiant Extra product, expected to reach 70% by end of year.
Positive Financial Indicators
Fourth quarter airline revenue of nearly $610 million was up slightly year-over-year, with strong performance in the three-week holiday period growing more than 14% year-over-year.
Debt Reduction and Liquidity
Total debt balances were down nearly $200 million during 2024 with $1.1 billion in available liquidity.
Lowlights
Revenue Decline
2024 airline revenue of $2.44 billion, approximately 2.6% below the prior year.
Sunseeker Impairment
Recorded a total non-cash impairment of $322 million for Sunseeker due to downward revision of earnings estimates.
Pilot Retention Bonus Impact
Fourth quarter CASM mix includes roughly $20 million related to a pilot retention bonus.
Foreign Exchange Pressure
Strengthening U.S. dollar against the Canadian dollar applied pressure on origination cities near the border.
Company Guidance
In the Allegiant Travel Company Fourth Quarter and Full-Year 2024 Earnings Call, the company reported a commendable adjusted airline-only operating margin of over 13% for the December quarter, a 6.5-point increase from the previous year. A significant 16% increase in December capacity was driven by aircraft utilization averaging 9.6 hours per day, marking a 21% year-over-year rise. The company achieved a controllable completion rate of 99.7% during the peak holiday period. Allegiant plans to maintain this momentum into 2025, with expectations of over 15% capacity growth throughout the year. They ended 2024 with $2.44 billion in airline revenue, a slight 2.6% decrease from the prior year, while total ASMs grew 1.1%. Allegiant also highlighted the introduction of four MAX aircraft and anticipates a full-year EPS guidance midpoint of $9, suggesting more than a 50% improvement in earnings compared to 2024. Additionally, the Allegiant Always credit card is expected to generate over $140 million in total remuneration in 2025.Allegiant Travel Company Corporate Events
Business Operations and StrategyFinancial Disclosures
Allegiant Travel Reports Mixed 2024 Financial Results
Neutral
Feb 4, 2025
On February 4, 2025, Allegiant Travel Company reported its financial results for the fourth quarter and full-year 2024. The company experienced a GAAP diluted loss per share of $12.00 for the fourth quarter and $13.49 for the full year, largely due to a one-time impairment charge related to the Sunseeker Resort. Despite this, the adjusted diluted earnings per share for the airline-only operations were $3.00 for the fourth quarter and $5.84 for the year. The report highlights a mixed financial performance with significant losses impacted by special charges, but showcases resilience in its core airline operations.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.