Airline Stock Roundup: ALGT Q3 Revenue Down, September Traffic Up at RYAAY

Last week, Allegiant Travel ALGT updated its projections for the September quarter, taking into account the likely impact of Hurricane Ian. With air travel demand rebounding from pandemic lows, Ryanair Holdings RYAAY carried 13% more passengers in September than three years ago.

Again, due to the favorable air travel demand scenario, consolidated traffic at Gol Linhas The GOL rose 41.4% in September from the level a year ago. The proposed merger between Jet Blue Airways JBLU and Spirit Airlines SAVE has secured the support of two leading proxy companies.

Read the latest airline roundup here

Summary of the latest Top Stories

1. ALGT now expects third quarter 2022 operating revenue to grow 27.5% over third quarter 2019 actuals (previous outlook was for 29% growth). Per Drew Wells, Senior Vice President, Revenue at Allegiant, “The impacts of Hurricane Ian have resulted in the cancellation of the majority of our flights affecting Florida over the next few days. While the situation continues to evolve, we believe Ian’s impacts will reduce our revenue guide by 1.5 percentage points a few years ago (previous outlook was for roughly 16% growth).Scheduled capacity for the September quarter is now expected to increase by around 17% compared to the actual figures for the third quarter of 2019 (the previous outlook had predicted growth of almost 18%).

Cost per available seat mile (excluding fuel) is now expected to increase 13-14% compared to actuals in Q3 2019 (previous guidance called for a 10% increase). Fuel cost per gallon is now expected to be $3.87 per gallon (previous forecast: $3.80).

2. In September, RYAAY’s passenger volume was 15.9 million, compared to 10.6 million a year ago. The load factor (% of seats occupied by passengers) was 94% in September 2022 compared to 81% a year ago. Ryanair is aiming to increase its traffic in the 2023 financial year to 165 million, indicating an 11% growth on pre-COVID traffic figures.

3. In September, Gol Linhas’ consolidated load factor improved by 2.6 percentage points to 81.7%, with traffic growth outpacing capacity expansion of 36.9% by one year to the next. The dynamism of traffic on its domestic markets leads to an optimistic scenario on a consolidated basis. In September, domestic traffic and capacity improved by 27% and 23% respectively. On the domestic front, 27.9% more passengers boarded GOL flights in September 2022. The domestic load factor was 81.7%. The volume of departures and seats increased by 24.5% and 24% respectively.

4. The impending takeover of Spirit Airlines by JetBlue for $3.8 billion was supported by two independent proxy advisory firms, namely Institutional Shareholder Services and Glass, Lewis & Company. The companies recommended that SAVE shareholders vote in favor of the deal at its Oct. 19 special meeting. Expressing his delight to have secured their support, SAVE President and CEO Ted Christie said, “We appreciate the recognition of the merger by both leading proxy advisory firms. The agreement with JetBlue is the best way forward for Spirit, creating significant value for our shareholders and enhancing our ability to grow and compete with dominant US carriers.


The following table shows the price development of the major airline players over the past week and over the past six months.

Image source: Zacks Investment Research

The chart above shows that almost all airline stocks traded in the green over the five trading days. The NYSE ARCA Airline Index rose 8.6% to $54.53. Over the past six months, the NYSE ARCA Airline Index has fallen 27.7%.

What’s next in airspace?

Investors would be eagerly awaiting third quarter 2022 results from Delta Airlines DAL, which is scheduled for release on October 13. We expect strong air travel demand to have contributed to DAL’s performance. However, high fuel costs are likely to have undermined its results.

Our proven model does not predict an earnings beat for Delta this time around. The combination of a positive Earnings ESP and a Zacks rank of #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of beating Earnings. However, that is not the case here. Delta currently has a Gains ESP of -2.50% (Zacks consensus estimate is set at $1.57 while the most accurate estimate is currently 4 cents lower) and a Zacks rank of no. 3. You can see the Full list of today’s Zacks #1 Rank stocks here.

You can discover the best stocks to buy or sell before they’re flagged with our earnings ESP filter.

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Ryanair Holdings PLC (RYAAY): Free Stock Analysis Report

Delta Air Lines, Inc. (DAL): Free Inventory Analysis Report

JetBlue Airways Corporation (JBLU): Free Inventory Analysis Report

Gol Linhas Aereas Inteligentes SA (GOL): Free Stock Analysis Report

Spirit Airlines, Inc. (SAVE): Free Stock Analysis Report

Allegiant Travel Company (ALGT): Free Inventory Analysis Report

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