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Allegiant Travel (ALGT) Soars 5.3%: Is Further Upside Left in the Stock?

Zacks Equity Research
·2-min read

Allegiant Travel (ALGT) shares soared 5.3% in the last trading session to close at $123.49. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 19.8% loss over the past four weeks.

The uptick is owing to the upbeat air-travel demand despite high airfares. Owing to the uptick in air-travel demand, ALGT carried 40% more passengers in May 2022, system-wide, than a year ago.

This travel services company is expected to post quarterly earnings of $2.44 per share in its upcoming report, which represents a year-over-year change of -29.5%. Revenues are expected to be $646.02 million, up 36.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

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For Allegiant Travel, the consensus EPS estimate for the quarter has been revised 10% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on ALGT going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Allegiant Travel is a member of the Zacks Transportation - Airline industry. One other stock in the same industry, International Consolidated Airlines Group SA (ICAGY), finished the last trading session 1.1% higher at $2.81. ICAGY has returned -13.9% over the past month.

For International Consolidated Airlines Group SA , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.03. This represents a change of +102.4% from what the company reported a year ago. International Consolidated Airlines Group SA currently has a Zacks Rank of #4 (Sell).


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Zacks Investment Research