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Why Is Spirit (SAVE) Down 25.4% Since Last Earnings Report?
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A month has gone by since the last earnings report for Spirit (SAVE - Free Report) . Shares have lost about 25.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Spirit due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Spirit Airlines Incurs Narrower Than Expected Loss in Q4
Spirit Airlines’ loss (excluding 16 cents from non-recurring items) of 64 cents per share was narrower than the Zacks Consensus Estimate of a loss of 89 cents and the year-ago quarter’s loss of $1.63. In fourth-quarter 2019 (pre-coronavirus era), the carrier had reported earnings of $1.20 per share.
In fourth-quarter 2021, operating revenues of $987.6 million increased 98.1% year over year. The upside reflects improving air-travel demand as Omicron-led COVIDb-19 cases fell in the United States. Revenues were also, higher than the Zacks Consensus Estimate of $961.8 million.
In fourth-quarter 2021, passenger revenues, which accounted for the bulk of the top line (98.4%), increased 99% year over year (when the impact of coronavirus on air-travel demand was severe) to $971.7 million. Passenger revenues were up 2.1% from the fourth-quarter 2019 actuals. Other revenues surged 57.2% year over year to $15.8 million.
Other Details
All comparisons (in %) are presented below on a year-over-year basis.
Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) at Spirit skyrocketed 63.7% in the reported quarter. To cater to this increased demand, capacity (measured in available seat miles) expanded to 46.7%. Load factor (percentage of seats filled by passengers) increased 8.3 points to 79.8% in the fourth quarter of 2021. Total operating revenue per available seat miles (TRASM) soared 35% to 8.6 cents in the reported quarter. The average yield surged 21% to 10.78 cents.
Adjusted operating expenses (excluding fuel) escalated 34.5% to $751.1 million. Average fuel cost per gallon in the reported quarter rose to $2.41 from $1.32 as oil prices shot up. Fuel gallons consumed skyrocketed 57.6% to $123.3 million, reflecting the usage of more planes to cater to upbeat air-travel demand. Adjusted cost per available seat miles (CASM) excluding fuel decreased 8.3% in the reported quarter, reflecting the expanded capacity. Spirit took the delivery of five new A320neo aircraft during fourth-quarter 2021.
Spirit Airlines ended the quarter with unrestricted cash, cash equivalents and short-term investments, and the liquidity available under the carrier’s revolving credit facility of $1.7 billion. Capital expenditures for full-year 2021 were approximately $333.1 million. The expenditures were primarily related to pre-delivery deposits associated with future aircraft deliveries and the purchase of four aircraft and two engines off lease.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -43.33% due to these changes.
VGM Scores
At this time, Spirit has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Spirit has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Spirit (SAVE) Down 25.4% Since Last Earnings Report?
A month has gone by since the last earnings report for Spirit (SAVE - Free Report) . Shares have lost about 25.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Spirit due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Spirit Airlines Incurs Narrower Than Expected Loss in Q4
Spirit Airlines’ loss (excluding 16 cents from non-recurring items) of 64 cents per share was narrower than the Zacks Consensus Estimate of a loss of 89 cents and the year-ago quarter’s loss of $1.63. In fourth-quarter 2019 (pre-coronavirus era), the carrier had reported earnings of $1.20 per share.
In fourth-quarter 2021, operating revenues of $987.6 million increased 98.1% year over year. The upside reflects improving air-travel demand as Omicron-led COVIDb-19 cases fell in the United States. Revenues were also, higher than the Zacks Consensus Estimate of $961.8 million.
In fourth-quarter 2021, passenger revenues, which accounted for the bulk of the top line (98.4%), increased 99% year over year (when the impact of coronavirus on air-travel demand was severe) to $971.7 million. Passenger revenues were up 2.1% from the fourth-quarter 2019 actuals. Other revenues surged 57.2% year over year to $15.8 million.
Other Details
All comparisons (in %) are presented below on a year-over-year basis.
Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) at Spirit skyrocketed 63.7% in the reported quarter. To cater to this increased demand, capacity (measured in available seat miles) expanded to 46.7%. Load factor (percentage of seats filled by passengers) increased 8.3 points to 79.8% in the fourth quarter of 2021. Total operating revenue per available seat miles (TRASM) soared 35% to 8.6 cents in the reported quarter. The average yield surged 21% to 10.78 cents.
Adjusted operating expenses (excluding fuel) escalated 34.5% to $751.1 million. Average fuel cost per gallon in the reported quarter rose to $2.41 from $1.32 as oil prices shot up. Fuel gallons consumed skyrocketed 57.6% to $123.3 million, reflecting the usage of more planes to cater to upbeat air-travel demand. Adjusted cost per available seat miles (CASM) excluding fuel decreased 8.3% in the reported quarter, reflecting the expanded capacity. Spirit took the delivery of five new A320neo aircraft during fourth-quarter 2021.
Spirit Airlines ended the quarter with unrestricted cash, cash equivalents and short-term investments, and the liquidity available under the carrier’s revolving credit facility of $1.7 billion. Capital expenditures for full-year 2021 were approximately $333.1 million. The expenditures were primarily related to pre-delivery deposits associated with future aircraft deliveries and the purchase of four aircraft and two engines off lease.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -43.33% due to these changes.
VGM Scores
At this time, Spirit has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Spirit has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.