Alaska Air Group (NYSE:ALK) Stock Gets Price Target Reduction from Susquehanna

Key Points

• Susquehanna cut Alaska Air Group’s price target from $50 to $43 while maintaining a positive rating, implying roughly 28% upside from the stock’s $33.56 price. Analysts overall hold a “Moderate Buy” consensus with an average target of $56.85.
• Alaska Air reported quarterly revenue of $4.31 billion, up 14.4% year over year, but earnings of $0.36 per share missed the $0.39 consensus estimate and the company remained unprofitable on a GAAP basis.
• Fuel costs and worsening earnings expectations remain key risks: management forecast a fourth-quarter adjusted loss of $2.00–$2.50 per share, substantially worse than analysts’ expected $1.14 loss, despite growth in premium and diversified revenue.

Alaska Air Group (NYSE:ALK - Get Free Report) had its target price decreased by investment analysts at Susquehanna from $50.00 to $43.00 in a note issued to investors on Thursday, Benzinga reports. The brokerage presently has a "positive" rating on the transportation company's stock. Susquehanna's target price would indicate a potential upside of 28.14% from the company's current price.

A number of other brokerages have also weighed in on ALK. Bank of America increased their target price on Alaska Air Group from $60.00 to $65.00 and gave the stock a "buy" rating in a research note on Wednesday, July 1st. Barclays set a $52.00 price target on Alaska Air Group and gave the company an "overweight" rating in a research note on Friday, September 11th. The Goldman Sachs Group reaffirmed a "buy" rating and issued a $69.00 price objective (up from $58.00) on shares of Alaska Air Group in a report on Thursday, July 2nd. Wall Street Zen lowered Alaska Air Group from a "sell" rating to a "strong sell" rating in a report on Monday, October 5th. Finally, JPMorgan Chase & Co. lowered their price objective on Alaska Air Group from $94.00 to $92.00 and set an "overweight" rating on the stock in a research report on Friday, July 24th. Ten investment analysts have rated the stock with a Buy rating, one has issued a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus price target of $56.85.

Alaska Air Group Stock Performance

Shares of ALK stock opened at $33.56 on Thursday. The company has a market capitalization of $3.74 billion, a price-to-earnings ratio of -9.56 and a beta of 1.33. The company has a debt-to-equity ratio of 1.58, a quick ratio of 0.51 and a current ratio of 0.55. The company has a 50-day simple moving average of $40.23 and a 200 day simple moving average of $43.20. Alaska Air Group has a 52 week low of $33.03 and a 52 week high of $60.63.

Alaska Air Group (NYSE:ALK - Get Free Report) last announced its quarterly earnings results on Tuesday, October 20th. The transportation company reported $0.36 EPS for the quarter, missing analysts' consensus estimates of $0.39 by ($0.03). The company had revenue of $4.31 billion during the quarter, compared to analyst estimates of $4.31 billion. Alaska Air Group had a negative net margin of 2.58% and a negative return on equity of 5.31%. The firm's quarterly revenue was up 14.4% on a year-over-year basis. During the same quarter last year, the company posted $1.05 EPS. On average, sell-side analysts predict that Alaska Air Group will post -3.26 earnings per share for the current year.

Insiders Place Their Bets

In other news, EVP Andrew Harrison sold 5,300 shares of the stock in a transaction on Monday, August 3rd. The stock was sold at an average price of $49.67, for a total transaction of $263,251.00. Following the sale, the executive vice president directly owned 25,528 shares of the company's stock, valued at approximately $1,267,975.76. This represents a 17.19% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Benito Minicucci bought 25,000 shares of Alaska Air Group stock in a transaction dated Thursday, August 20th. The shares were bought at an average cost of $40.06 per share, for a total transaction of $1,001,500.00. Following the completion of the acquisition, the chief executive officer owned 256,582 shares in the company, valued at $10,278,674.92. This represents a 10.80% increase in their position. The SEC filing for this purchase provides additional information. Corporate insiders own 1.00% of the company's stock.

Institutional Investors Weigh In On Alaska Air Group

Several institutional investors and hedge funds have recently bought and sold shares of ALK. Root Financial Partners LLC acquired a new position in Alaska Air Group in the 3rd quarter valued at approximately $48,000. Quadrant Capital Group LLC raised its stake in shares of Alaska Air Group by 15.1% during the third quarter. Quadrant Capital Group LLC now owns 7,979 shares of the transportation company's stock valued at $302,000 after acquiring an additional 1,048 shares during the last quarter. Mosley Wealth Management lifted its holdings in shares of Alaska Air Group by 1,475.0% during the third quarter. Mosley Wealth Management now owns 945 shares of the transportation company's stock worth $34,000 after purchasing an additional 885 shares during the period. Daytona Street Capital LLC lifted its holdings in shares of Alaska Air Group by 1.3% during the third quarter. Daytona Street Capital LLC now owns 91,940 shares of the transportation company's stock worth $3,658,000 after purchasing an additional 1,200 shares during the period. Finally, Assenagon Asset Management S.A. lifted its holdings in shares of Alaska Air Group by 1,065.1% during the third quarter. Assenagon Asset Management S.A. now owns 314,093 shares of the transportation company's stock worth $12,155,000 after purchasing an additional 287,134 shares during the period. Institutional investors own 81.90% of the company's stock.

Alaska Air Group News Roundup

Here are the key news stories impacting Alaska Air Group this week:

• Positive Sentiment: Alaska Air reported third-quarter revenue of approximately $4.31 billion, up 14.4% year over year. Adjusted EPS of $0.36 exceeded the Zacks consensus estimate of $0.35, supported by strong yields and higher premium demand. Alaska Air Group Q3 Earnings Top Estimates
• Positive Sentiment: The airline continues to diversify beyond its traditional passenger business. Diversified revenue reached 54% of the mix, premium traffic increased 24.5% year over year, and Alaska highlighted planned international expansion, including new Seattle service to Osaka and Papeete. Alaska Air: 3 Key Takeaways for Long-Term Investors
• Neutral Sentiment: Analysts’ average price target is reported at $57.38, well above the current trading level, but price targets may not reflect the company’s worsening near-term earnings outlook. Alaska Air Group Analyst Price Target
• Negative Sentiment: Alaska reported a GAAP third-quarter loss of $1.32 per share, or $147 million, compared with $1.05 of EPS a year earlier. Although adjusted EPS was positive, it was below some analyst estimates of $0.39, underscoring margin pressure. Alaska Air Group Reports Third-Quarter Results
• Negative Sentiment: Higher-than-expected fuel expenses more than offset revenue growth. Management now expects a fourth-quarter adjusted loss of $2.00 to $2.50 per share, versus consensus for a loss of $1.14, making the guidance cut the clearest reason for the stock’s decline. Alaska Air Forecasts Larger Fourth-Quarter Loss

Alaska Air Group Company Profile

Alaska Air Group, Inc is an airline holding company headquartered in Seattle, Washington. Its principal subsidiaries include Alaska Airlines and Hawaiian Airlines, which operate under separate brands while serving passengers throughout North America, the Pacific and other international markets.

Alaska Airlines provides scheduled passenger and air cargo services across the United States, Canada, Mexico, Costa Rica and the Bahamas, with a strong presence on the U.S. West Coast and in Alaska.

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