Air Canada (OTCMKTS:ACDVF) Shares Gap Down Following Weak Earnings

Key Points

• Air Canada shares gapped down from $15.98 to $14.71 prior to trading on Tuesday, indicating a significant drop in stock price.
• Analysts have mixed opinions, with Royal Bank of Canada upgrading the stock to "moderate buy," while Jefferies Financial Group downgraded it to "underperform."
• The company's latest earnings report showed a loss of ($0.31) EPS, which was better than the expected ($0.38), but revenue fell short at $3.61 billion against expectations of $5.35 billion.

Air Canada (OTCMKTS:ACDVF - Get Free Report)'s stock price gapped down prior to trading on Tuesday following a weaker than expected earnings announcement. The stock had previously closed at $15.98, but opened at $14.71. Air Canada shares last traded at $14.70, with a volume of 31,030 shares trading hands.

The company reported $0.43 EPS for the quarter, missing analysts' consensus estimates of $0.50 by ($0.07). Air Canada had a return on equity of 45.69% and a net margin of 6.83%. The company had revenue of $4.14 billion during the quarter, compared to the consensus estimate of $5.55 billion.

Wall Street Analyst Weigh In

Several equities research analysts have recently commented on ACDVF shares. Royal Bank Of Canada raised Air Canada from a "hold" rating to a "moderate buy" rating in a research note on Monday, May 12th. Scotiabank reiterated an "outperform" rating on shares of Air Canada in a research note on Wednesday.

Air Canada Stock Performance

The firm has a market capitalization of $4.51 billion, a price-to-earnings ratio of 5.10 and a beta of 1.93. The company has a debt-to-equity ratio of 5.38, a quick ratio of 0.67 and a current ratio of 0.70. The firm's 50 day simple moving average is $14.81 and its 200 day simple moving average is $12.72.

Air Canada Company Profile

Air Canada provides domestic, U.S. transborder, and international airline services. The company provides scheduled passenger services under the Air Canada Vacations and Air Canada Rouge brand names in the Canadian market, the Canada-U.S. transborder market, and in the international market to and from Canada, as well as through capacity purchase agreements on other regional carriers.