Alaska Air Q4 Earnings & Revenues Surpass Estimates, Rise Y/Y

Alaska Air Group, Inc. (ALK) reported solid fourth-quarter 2024 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate. Quarterly earnings per share (EPS) of 97 cents outpaced the Zacks Consensus Estimate of 47 cents and improved more than 100% on a year-over-year basis. The reported figure exceeded the guided range of 40-50 cents.The bottom line benefited from solid revenue growth, cost and operational performance throughout the quarter and holiday travel periods. ALK also benefited from a renegotiation of certain interest payments and favorability in its fourth-quarter tax rate.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Operating revenues of $3.53 billion beat the Zacks Consensus Estimate of $3.51 billion. The top line jumped 38.4% year over year, with passenger revenues accounting for 89.9% of the top line and increasing 37% owing to the continued recovery in air-travel demand.Passenger revenues totaled $3.17 billion in the reported quarter. On a year-over-year basis, cargo and other revenues of $132 million grew 113% year over year. Mileage plan other revenues grew 36% to $224 million.Fourth-quarter revenues were stronger than expected across Alaska and Hawaiian, backed by sustained leisure demand and an uptick in corporate travel, which improved close in demand. ALK delivered reliable operational performance for its guests throughout the holiday travel period, with higher-than-expected completion rate and load factor.Alaska Air Group, Inc. Price, Consensus and EPS Surprise Alaska Air Group, Inc. price-consensus-eps-surprise-chart | Alaska Air Group, Inc. QuoteAlaska Airlines’ chief executive officer, Ben Minicucci, stated, "This was a transformational year as we brought Hawaiian Airlines into Alaska Air Group and began our journey to unlock $1 billion in incremental pretax profit over the next three years. We're proud that our incentive plan will reward Alaska Airlines and Horizon Air employees with nearly six weeks of pay, which we believe will lead the industry. Looking forward, our vision is clear and we're focused on executing our strategic plan – leveraging the strengths of our combined network, enhancing the end-to-end travel experience for our guests, and delivering value for everyone who depends on us."Other Details of ALK’s Q4 EarningsAll comparisons have been presented on a year-over-year basis unless mentioned otherwise.Revenue per available seat mile (RASM: a key measure of unit revenues) grew 4% to 15.54 cents. Yield increased 1% to 16.67 cents.Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) grew 35% to 19.06 billion. To cater to this increased demand, capacity (measured in average seat miles) rose 33% to 22.74 billion. As traffic outpaced capacity expansion, the consolidated load factor (percentage of seat occupancy) rose 0.9 percentage points to 83.8%. Our estimate is pegged at 84.3%.In the fourth quarter, total operating expenses (on a reported basis) increased 37% to $3.46 billion.Economic fuel price per gallon fell 26% to $2.54. The reported figure lies below the guided range of $2.55-$2.65. Our estimate is pegged at $2.63.Consolidated operating costs per available seat mile (excluding fuel and special items) grew 8.6% as disciplined non-fuel cost performance offset higher performance-based pay accruals and better completion rates drove higher capacity.LiquidityAs of Dec. 31, 2024, Alaska Air had $1.20 billion of cash and cash equivalents compared with $1.01 billion at the end of the prior quarter. ALK exited the fourth quarter of 2024 with long-term debt (net of current portion) of $4.49 billion compared with $4.15 billion at the prior-quarter end. Debt-to-capitalization ratio was 45%.During the fourth quarter, ALK repurchased 3.9 million shares for $250 million, bringing the total repurchases to 5.5 million shares for $312 million in 2024.ALK authorized a new $1 billion dollar share repurchase plan to be executed over the next four years, with repurchases starting in January 2025ALK’s OutlookALK anticipates first-quarter 2025 adjusted loss per share in the range of 50-70 cents. The Zacks Consensus Estimate is currently pegged at a loss of 20 cents per share.The company expects available seat miles (a measure of capacity) to increase in the range of 2.5%-3.5% in the first quarter of 2025 from the first quarter of 2024 actuals. CASM is expected to increase in the range of low-single digits to mid-single digits, and RASM is expected to grow in the high single digits.For 2025, EPS is anticipated to remain above $5.75.The Zacks Consensus Estimate is pegged at $5.93.For 2025, capacity is expected to be up 2% to 3% year over year.ALK’s Zacks Rank and Price PerformanceCurrently, ALK sports a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.ALK’s encouraging price performance is not limited to the post-fourth-quarter earnings release. Over the past six months, shares of ALK have gained 86.3%, outperforming the industry’s surge of 25.9%.Six-Month Price ComparisonImage Source: Zacks Investment ResearchPerformances of Other Transportation CompaniesDelta Air Lines DAL reported fourth-quarter 2024 earnings (excluding 56 cents from non-recurring items) of $1.85 per share, which surpassed the Zacks Consensus Estimate of $1.76. Earnings increased 44.5% on a year-over-year basis due to low fuel costs.DAL’srevenues of $15.56 billion surpassed the Zacks Consensus Estimate of $14.99 billion and increased 9.4% on a year-over-year basis, driven by strong holiday travel demand. Adjusted operating revenues (excluding third-party refinery sales) totaled $14.44 billion, up 5.7% year over year. Passenger revenues, which accounted for 82.4% of total revenues, increased 5% year over year at $12.82 billion.J.B. Hunt Transport Services (JBHT) reported fourth-quarter 2024 earnings per share of $1.53, which fell short of the Zacks Consensus Estimate of $1.62. However, the bottom line increased 4.1% on a year-over-year basis.  JBHT’s total operating revenues of $3.15 billion narrowly beat the Zacks Consensus Estimate of $3.13 billion but declined 4.8% year over year. The decline was mainly due to lower fuel surcharge revenues and yield pressure in its Intermodal segment.JBHT’s fourth-quarter 2024 operating revenues of $2.78 billion, excluding fuel surcharge revenue, decreased 2% from the year-ago reported quarter. Total operating income for the reported quarter increased 2% year over year to $207 million.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Delta Air Lines, Inc. (DAL): Free Stock Analysis Report J.B. Hunt Transport Services, Inc. (JBHT): Free Stock Analysis Report Alaska Air Group, Inc. (ALK): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks