Itau BBA Securities Downgrades Controladora Vuela Compania de Aviacion (NYSE:VLRS) to Underperform

Key Points

• Itau BBA downgraded Controladora Vuela (NYSE:VLRS) from "market perform" to "underperform" and set a $7.40 target, implying about a 7.23% downside from the prior close.
• The company posted a sharp quarterly EPS miss (‑$0.62 vs. ‑$0.06 estimate), remains unprofitable with negative ROE and net margin, and the analyst consensus is a "Hold" with an average price target of $8.86 amid several recent downgrades and target cuts.
• Shares traded around $7.98 with a market cap of about $930 million, a debt-to-equity ratio of 1.90, and roughly 53.3% institutional ownership.

Controladora Vuela Compania de Aviacion (NYSE:VLRS - Get Free Report) was downgraded by analysts at Itau BBA Securities from a "market perform" rating to an "underperform" rating in a research note issued on Thursday, MarketBeat reports. They currently have a $7.40 target price on the transportation company's stock. Itau BBA Securities' target price suggests a potential downside of 7.23% from the stock's previous close.

A number of other analysts have also commented on the company. Zacks Research downgraded shares of Controladora Vuela Compania de Aviacion from a "strong-buy" rating to a "hold" rating in a report on Tuesday, February 24th. Barclays dropped their target price on shares of Controladora Vuela Compania de Aviacion from $10.00 to $9.00 and set an "overweight" rating on the stock in a report on Thursday, April 30th. Weiss Ratings reiterated a "sell (d)" rating on shares of Controladora Vuela Compania de Aviacion in a research note on Monday, April 20th. JPMorgan Chase & Co. dropped their target price on Controladora Vuela Compania de Aviacion from $11.00 to $10.50 and set a "neutral" rating on the stock in a research report on Thursday, March 12th. Finally, The Goldman Sachs Group lowered shares of Controladora Vuela Compania de Aviacion from a "buy" rating to a "neutral" rating and set a $7.60 target price for the company. in a research report on Monday, April 13th. Five research analysts have rated the stock with a Buy rating, four have issued a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat, Controladora Vuela Compania de Aviacion presently has an average rating of "Hold" and an average price target of $8.86.

Controladora Vuela Compania de Aviacion Trading Up 1.6%

NYSE VLRS traded up $0.13 during trading on Thursday, hitting $7.98. The company had a trading volume of 34,600 shares, compared to its average volume of 743,181. The company's fifty day moving average is $7.52 and its 200-day moving average is $8.03. The company has a current ratio of 0.67, a quick ratio of 0.66 and a debt-to-equity ratio of 1.90. The company has a market cap of $930.12 million, a price-to-earnings ratio of -7.47 and a beta of 1.77. Controladora Vuela Compania de Aviacion has a one year low of $3.90 and a one year high of $10.80.

Controladora Vuela Compania de Aviacion (NYSE:VLRS - Get Free Report) last issued its quarterly earnings results on Monday, April 27th. The transportation company reported ($0.62) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.06) by ($0.56). Controladora Vuela Compania de Aviacion had a negative return on equity of 50.26% and a negative net margin of 3.96%.The business had revenue of $770.00 million during the quarter, compared to the consensus estimate of $44.60 million. On average, sell-side analysts predict that Controladora Vuela Compania de Aviacion will post -2.19 earnings per share for the current year.

Institutional Trading of Controladora Vuela Compania de Aviacion

Hedge funds and other institutional investors have recently bought and sold shares of the business. Wellington Management Group LLP increased its position in shares of Controladora Vuela Compania de Aviacion by 2.6% during the fourth quarter. Wellington Management Group LLP now owns 5,053,229 shares of the transportation company's stock worth $44,873,000 after acquiring an additional 128,088 shares during the period. Arrowstreet Capital Limited Partnership grew its position in Controladora Vuela Compania de Aviacion by 48.9% during the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 1,720,522 shares of the transportation company's stock worth $12,353,000 after purchasing an additional 565,250 shares during the last quarter. Thomist Capital Management LP increased its position in shares of Controladora Vuela Compania de Aviacion by 3.9% in the 4th quarter. Thomist Capital Management LP now owns 1,009,652 shares of the transportation company's stock valued at $8,916,000 after acquiring an additional 37,457 shares during the period. Millennium Management LLC boosted its position in Controladora Vuela Compania de Aviacion by 126.5% in the 4th quarter. Millennium Management LLC now owns 990,495 shares of the transportation company's stock worth $8,796,000 after purchasing an additional 553,251 shares in the last quarter. Finally, Fourth Sail Capital LP lifted its position in shares of Controladora Vuela Compania de Aviacion by 0.4% in the fourth quarter. Fourth Sail Capital LP now owns 757,761 shares of the transportation company's stock valued at $6,729,000 after acquiring an additional 3,277 shares in the last quarter. Hedge funds and other institutional investors own 53.32% of the company's stock.

About Controladora Vuela Compania de Aviacion

Controladora Vuela Compañia de Aviacion, SAB de CV NYSE: VLRS is a Mexico-based airline holding company whose primary business is the operation of low-cost scheduled air transportation services. Through its principal operating subsidiary, Volaris, the company provides passenger and cargo flights on domestic and international routes. Its business model emphasizes unbundled ancillary services and point-to-point operations designed to offer competitive fares across its network.

Volaris serves more than 120 routes linking major metropolitan areas and secondary cities in Mexico, the United States and Central America.

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