Alaska Air Group, Inc. Price and EPS Surprise

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Alaska Air Group, Inc. ALK is scheduled to report third-quarter 2022 results on Oct 20, before market open.

The Zacks Consensus Estimate for ALK’s third-quarter 2022 earnings has been revised upward by 26.2% in the past 90 days. The company also has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 20.9%.

Alaska Air Group, Inc. Price and EPS Surprise

Alaska Air Group, Inc. price-eps-surprise | Alaska Air Group, Inc. Quote

Let’s see how things are shaping up for Alaska Air this earnings season.

Q3 Expectations

The Zacks Consensus Estimate for Alaska Air’s third-quarter 2022 revenues is pegged at $2.83 billion, indicating 44.8% growth year over year. Our estimate of $2.82 billion of revenues indicates growth of 44.2% from the year-ago reported figure. The top line is likely to have been aided by the continued recovery in air-travel demand and an improvement in passenger revenues.

Moreover, ALK’s top-line guidance is also encouraging. Alaska Air expects total revenues to increase 16-19% from the third quarter of 2019 actuals. The passenger load factor is expected to be in the range of 85-88%.

On the flip side, escalating operating expenses, primarily due to rising fuel prices, continue to remain an overhang on Alaska Air’s bottom line. The carrier expects its third-quarter economic fuel cost to be in the $3.79-$3.89 range. The Zacks Consensus Estimate for economic fuel cost per gallon is pegged at $3.81, indicating 85.8% growth year over year.Our estimate of $3.78 billion indicates growth of 86.3% from the year-ago reported figure.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Alaska Air this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Alaska Air has an Earnings ESP of -0.73% and a Zacks Rank #3.

Highlights of Q2

Alaska Air’s second-quarter 2022 earnings of $2.19 per share (excluding $1.10 from non-recurring items) beat the Zacks Consensus Estimate of $1.94. The bottom line surged more than 100% year over year.

Operating revenues of $2,658 million outperformed the Zacks Consensus Estimate of $2,590.3 million. The top line surged 74% year over year with passenger revenues accounting for 90.9% of the top line and soaring 79% owing to the continued recovery in air-travel demand.

Stocks to Consider

Here are a few stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on third-quarter 2022 earnings:

Copa Holdings CPA has an Earnings ESP of +7.28% and a Zacks Rank #2. CPA will release results on Nov 16. You can see the complete list of today’s Zacks #1 Rank stocks here.

CPA has an expected earnings growth rate of more than 100% for the current year. CPA delivered a trailing four-quarter earnings surprise of 174.22%, on average.

JetBlue Airways JBLU has an Earnings ESP of +1.67% and a Zacks Rank #3. JBLU will release results on Oct 25.

JBLU has an expected earnings growth rate of 67.73% for the current year.

Shares of JBLU have lost 55.5% over the past year.

United Airlines UAL has an Earnings ESP of +5.29% and a Zacks Rank #3. UAL will release results on Oct 18.

UAL has an expected earnings growth rate of 103.3% for the current year. UAL delivered a trailing four-quarter earnings surprise of 10.53%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

5 Stocks Set to Double

Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>

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United Airlines Holdings Inc (UAL): Free Stock Analysis Report
 
JetBlue Airways Corporation (JBLU): Free Stock Analysis Report
 
Copa Holdings, S.A. (CPA): Free Stock Analysis Report
 
Alaska Air Group, Inc. (ALK): Free Stock Analysis Report
 
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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