Alaska Air(US:ALK) ZACKS·2025-06-16 23:01Core Viewpoint - Alaska Air Group's stock has shown a recent increase but has underperformed over the past month, with significant earnings expectations for the upcoming report indicating a decline in earnings per share year-over-year while revenue is expected to grow [1][2]. Financial Performance - Alaska Air Group closed at $48.79, reflecting a daily increase of 2.8%, outperforming the S&P 500's gain of 0.94% [1]. - The airline's shares have decreased by 11.54% over the past month, contrasting with the Transportation sector's loss of 1.61% and the S&P 500's gain of 1.67% [1]. - Analysts expect earnings of $1.57 per share for the upcoming earnings report, representing a year-over-year decline of 38.43% [2]. - Revenue is forecasted to be $3.66 billion, indicating a growth of 26.26% compared to the same quarter last year [2]. Annual Estimates - For the entire year, earnings are projected at $3.65 per share, reflecting a decline of 25.05%, while revenue is expected to reach $14.21 billion, indicating a growth of 21.09% compared to the previous year [3]. - Recent changes in analyst estimates suggest evolving short-term business trends, with positive revisions indicating a favorable business outlook [3]. Stock Performance and Valuation - The Zacks Rank system, which evaluates estimate changes, currently ranks Alaska Air Group at 3 (Hold) [5]. - The company is trading at a Forward P/E ratio of 13, which is a premium compared to the industry average of 9.2 [6]. - Alaska Air Group has a PEG ratio of 0.48, lower than the Transportation - Airline industry's average PEG ratio of 0.85 [6]. Industry Context - The Transportation - Airline industry holds a Zacks Industry Rank of 41, placing it in the top 17% of over 250 industries [7]. - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7].