Frontier Group Holdings (ULCC) AI Stock Analysis

• Market Cap: $1.17B
• Dividend Yield: N/A
• Average Volume (3M): 4.33M
• Price to Earnings (P/E): 13.4
• Beta (1Y): 1.66
• Revenue Growth: 4.60%
• EPS Growth: 49.81%
• Country: US
• Employees: 7,906
• Sector: Industrials
• Sector Strength: 72
• Industry: Airlines, Airports & Air Services
• EPS (TTM): -0.31
• Shares Outstanding: 228,155,460
• 10 Day Avg. Volume: 3,563,435
• 30 Day Avg. Volume: 4,333,801
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 4.38
• Enterprise Value/Revenue: 1.36
• Enterprise Value/Gross Profit: 6.52
• Enterprise Value/Ebitda: 119.41
• 1Y Price Target: $4.71
• Price Target Upside: -8.37% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 8

• Rating: 54 Neutral
• Price Target: $5.50 ▲(7.00% Upside)

The overall stock score of 54 reflects significant financial challenges, including negative profitability and high leverage, which are partially offset by positive technical indicators suggesting bullish momentum. The valuation remains unattractive due to the negative P/E ratio and lack of dividend yield.

Positive Factors

Loyalty Revenue Growth

The significant increase in loyalty revenue indicates strong customer engagement and provides a stable, recurring revenue stream, enhancing long-term financial stability.

Fleet Expansion

Expanding the fleet with efficient aircraft enhances operational capacity and cost-effectiveness, supporting growth and competitive positioning in the airline market.

Introduction of First-Class Seating

Adding first-class seating aligns with premiumization strategies, potentially increasing revenue per passenger and attracting higher-spending customers.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, especially in downturns, impacting long-term financial health and strategic options.

Negative Profitability Margins

Negative profitability margins indicate operational inefficiencies and challenges in sustaining profitability, which could hinder future investments and growth.

Negative Cash Flow

Negative cash flow signals potential liquidity issues, limiting the company's ability to invest in growth opportunities and manage debt obligations effectively.

Frontier Group Holdings Business Overview & Revenue Model

Company Description

Frontier Group Holdings, Inc., a low-fare airline company, provides air transportation for passengers. The company operates an airline that serves approximately 120 airports throughout the United States and international destinations in the Americas. It offers its services through direct distribution channels, including its website, mobile app, and call center. As of December 31, 2021, the company had a fleet of 110 Airbus single-aisle aircraft comprising, 16 A320ceos, 73 A320neos, and 21 A321ceos. Frontier Group Holdings, Inc. was incorporated in 2013 and is headquartered in Denver, Colorado.

How the Company Makes Money

Frontier Group Holdings generates revenue primarily through its passenger ticket sales, which are offered at low base fares with additional fees for optional services. Key revenue streams include ancillary revenues from baggage fees, seat selection, and onboard food and beverage sales. The company also benefits from partnerships with various travel-related services, including car rental and hotel bookings, which provide additional income opportunities. The focus on operational efficiency and cost control further enhances profitability, allowing Frontier to maintain competitive pricing while maximizing earnings from add-on services.

Frontier Group Holdings Financial Statement Overview

Summary

Frontier Group Holdings faces significant financial challenges, with declining revenue growth, negative profitability margins, and high leverage. The company's cash flow position is weak, with negative operating and free cash flows. These factors indicate potential financial instability and highlight the need for strategic improvements to enhance profitability and reduce financial risk.

Income Statement

Frontier Group Holdings has experienced fluctuating revenue growth, with a recent decline in the TTM period. Gross profit margins have decreased significantly from the previous year, and net profit margins have turned negative. The EBIT and EBITDA margins are also weak, indicating challenges in operational efficiency and profitability.

Balance Sheet

The company has a high debt-to-equity ratio, which has increased in the TTM period, indicating significant leverage and potential financial risk. Return on equity is negative, reflecting poor profitability relative to shareholder equity. The equity ratio is low, suggesting a heavy reliance on debt financing.

Cash Flow

Operating cash flow and free cash flow are both negative, with a declining trend in free cash flow growth. The operating cash flow to net income ratio is negative, indicating cash flow challenges. The free cash flow to net income ratio is high, but this is due to negative net income, which is not a positive indicator.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.78B	3.77B	3.59B	3.33B	2.06B	1.25B
Gross Profit	787.00M	1.94B	302.00M	282.00M	-202.00M	-390.00M
EBITDA	43.00M	122.00M	83.00M	10.00M	-99.00M	-327.00M
Net Income	-33.00M	85.00M	-11.00M	-37.00M	-102.00M	-225.00M
Balance Sheet
Total Assets	6.52B	6.15B	4.99B	4.50B	4.24B	3.55B
Cash, Cash Equivalents and Short-Term Investments	563.00M	740.00M	609.00M	761.00M	918.00M	378.00M
Total Debt	4.87B	4.47B	3.46B	2.93B	2.85B	2.61B
Total Liabilities	6.02B	5.55B	4.49B	3.99B	3.71B	3.24B
Stockholders Equity	506.00M	604.00M	507.00M	509.00M	530.00M	310.00M
Cash Flow
Free Cash Flow	-210.00M	-158.00M	-348.00M	-230.00M	153.00M	-573.00M
Operating Cash Flow	-69.00M	-82.00M	-261.00M	-78.00M	216.00M	-557.00M
Investing Cash Flow	-154.00M	-75.00M	-90.00M	-154.00M	-67.00M	11.00M
Financing Cash Flow	347.00M	288.00M	199.00M	75.00M	391.00M	156.00M

Frontier Group Holdings Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.14
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ULCC, the sentiment is Neutral. The current price of 5.14 is below the 20-day moving average (MA) of 5.22, above the 50-day MA of 4.63, and below the 200-day MA of 5.31, indicating a neutral trend. The MACD of 0.14 indicates Positive momentum. The RSI at 45.28 is Neutral, neither overbought nor oversold. The STOCH value of 12.79 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ULCC.

Frontier Group Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNCY	73 Outperform	658.46M	11.15	9606.85%	―	3.76%	17.44%
SKYW	68 Neutral	4.16B	10.35	15.80%	―	20.45%	131.25%
VLRS	64 Neutral	778.37M	-23.72	-12.20%	―	-7.05%	-128.03%
ULCC	54 Neutral	$1.17B	13.43	-6.63%	―	4.60%	49.81%
ALGT	52 Neutral	1.12B	-3.72	-27.09%	―	3.17%	-1689.03%
JBLU	48 Neutral	1.85B	-4.54	-16.03%	―	-1.90%	61.06%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Frontier Group Holdings Corporate Events

Frontier Group Holdings Reaffirms Q2 2025 Loss Guidance

Frontier Group Holdings reaffirmed its adjusted loss per share guidance for Q2 2025, initially disclosed on May 1, 2025, ahead of an investor conference on May 22, 2025. The company noted stable travel demand following earlier disruptions and expects positive revenue per available seat mile, despite lower capacity compared to the previous year. CEO Barry Biffle highlighted stabilized booking trends for May and early summer, with load factors slightly higher and RASM up in low single-digits. The company aims for profitability in the second half of 2025, leveraging commercial investments and cost management, with unchanged capacity plans for the rest of 2025.