Allegiant Travel Company Earnings Preview

Motley Fool Staff
Updated

Investors hope Allegiant Travel Company (NAS: ALGT) will top analyst estimates once again after beating predictions by one cent in the previous quarter. The company will unveil its latest earnings on Monday, August 1. A leisure travel company, which is focused on transporting travelers in small cities to leisure destinations such as Las Vegas, Nevada, Phoenix, Arizona, Orlando, Florida, Tampa/St. Petersburg, Florida and Ft. Lauderdale, Florida.

What analysts say:

  • Buy, sell, or hold?: The majority of analysts back Allegiant Travel Company as a buy. But with 54.5% of analysts rating it a buy, Allegiant Travel Company is still below the mean analyst rating of its nearest 10 competitors, which average 58.8% buys. Analysts like Allegiant Travel Company better than competitor SkyWest overall. Two out of six analysts rate SkyWest a buy compared to six of 11 for Allegiant Travel Company.

  • Revenue Forecasts: On average, analysts predict $193.3 million in revenue this quarter. That would represent a rise of 14.9% from the year-ago quarter.

  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.59 per share. Estimates range from $0.50 to $0.66.

What our community says:
CAPS All-Stars are solidly behind the stock with 79.6% awarding it an "outperform" rating. The community at large concurs with the All-Stars with 79.1% granting it a rating of "outperform." Fools are bullish on Allegiant Travel, though the message boards have been quiet lately with only 94 posts in the past 30 days. Allegiant Travel's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Allegiant Travel's income has fallen year over year by an average of 9.4%. The company's gross margin shrank by 7.2 percentage points in the last quarter. Revenue rose 13.9% while cost of sales rose 30% to $112.2 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

41.9%

42.4%

41.3%

44.8%

Operating Margin

18.1%

12.9%

11.9%

21.5%

Net Margin

8.9%

7.6%

8%

10.4%

One final thing: If you want to keep tabs on Allegiant Travel movements, and for more analysis on the company, make sure you add it to your Watchlist.

The Motley Fool owns shares of Allegiant Travel.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

At the time thisarticle was published

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