Alaska Air Group (NYSE:ALK) and SkyWest (NASDAQ:SKYW) are both mid-cap transportation companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, earnings, profitability, institutional ownership and dividends.
Analyst Recommendations
This is a summary of recent ratings and price targets for Alaska Air Group and SkyWest, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Alaska Air Group | 0 | 1 | 12 | 1 | 3.00 |
| SkyWest | 0 | 0 | 3 | 1 | 3.25 |
Alaska Air Group presently has a consensus price target of $67.7692, indicating a potential downside of 2.25%. SkyWest has a consensus price target of $60.00, indicating a potential upside of 15.32%. Given SkyWest's stronger consensus rating and higher possible upside, analysts clearly believe SkyWest is more favorable than Alaska Air Group.
Earnings & Valuation
This table compares Alaska Air Group and SkyWest's revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Alaska Air Group | $8.78 billion | 0.98 | $769 million | $6.42 | 10.80 |
| SkyWest | $2.97 billion | 0.88 | $340.10 million | $6.25 | 8.32 |
Alaska Air Group has higher revenue and earnings than SkyWest. SkyWest is trading at a lower price-to-earnings ratio than Alaska Air Group, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Alaska Air Group has a beta of 1.81, suggesting that its stock price is 81% more volatile than the S&P 500. Comparatively, SkyWest has a beta of 2.1, suggesting that its stock price is 110% more volatile than the S&P 500.
Profitability
This table compares Alaska Air Group and SkyWest's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Alaska Air Group | -13.96% | -19.39% | -5.51% |
| SkyWest | 4.84% | 5.10% | 1.65% |
Insider and Institutional Ownership
73.1% of Alaska Air Group shares are held by institutional investors. Comparatively, 87.5% of SkyWest shares are held by institutional investors. 0.5% of Alaska Air Group shares are held by insiders. Comparatively, 2.7% of SkyWest shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Summary
SkyWest beats Alaska Air Group on 9 of the 14 factors compared between the two stocks.
