ALASKA AIR GROUP INC (ALK) Stock Fundamental Analysis
USA - NYSE:ALK - US0116591092 - Common Stock
47.31 USD
-0.47 (-0.98%)
47.48 USD
+0.17 (+0.36%)
Taking everything into account, ALK scores 4 out of 10 in our fundamental rating. ALK was compared to 21 industry peers in the Passenger Airlines industry. While ALK is still in line with the averages on profitability rating, there are concerns on its financial health. ALK has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
ALK had positive earnings in the past year.
In the past year ALK had a positive cash flow from operations.
Of the past 5 years ALK 4 years were profitable.
ALK had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of ALK (1.57%) is better than 66.67% of its industry peers.
ALK has a better Return On Equity (7.94%) than 66.67% of its industry peers.
ALK has a Return On Invested Capital (4.44%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for ALK is significantly below the industry average of 14.46%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.57% | ||
| ROE | 7.94% | ||
| ROIC | 4.44% |
ROA(3y)1.34%
ROA(5y)-0.4%
ROE(3y)5.42%
ROE(5y)-3.09%
ROIC(3y)5.24%
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 2.33%, ALK is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
In the last couple of years the Profit Margin of ALK has declined.
ALK has a Operating Margin (5.99%) which is in line with its industry peers.
ALK's Operating Margin has declined in the last couple of years.
ALK's Gross Margin of 56.32% is fine compared to the rest of the industry. ALK outperforms 61.90% of its industry peers.
ALK's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.99% | ||
| PM (TTM) | 2.33% | ||
| GM | 56.32% |
OM growth 3YN/A
OM growth 5Y-9.13%
PM growth 3Y-24.24%
PM growth 5Y-17.41%
GM growth 3Y3.86%
GM growth 5Y0.81%
2. Health
2.1 Basic Checks
ALK has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, ALK has less shares outstanding
ALK has about the same amout of shares outstanding than it did 5 years ago.
Compared to 1 year ago, ALK has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.17, we must say that ALK is in the distress zone and has some risk of bankruptcy.
ALK has a Altman-Z score (1.17) which is comparable to the rest of the industry.
ALK has a Debt/Equity ratio of 1.14. This is a high value indicating a heavy dependency on external financing.
ALK has a better Debt to Equity ratio (1.14) than 61.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.17 |
ROIC/WACC0.55
WACC8.08%
2.3 Liquidity
ALK has a Current Ratio of 0.52. This is a bad value and indicates that ALK is not financially healthy enough and could expect problems in meeting its short term obligations.
ALK has a Current ratio of 0.52. This is in the lower half of the industry: ALK underperforms 66.67% of its industry peers.
A Quick Ratio of 0.49 indicates that ALK may have some problems paying its short term obligations.
With a Quick ratio value of 0.49, ALK perfoms like the industry average, outperforming 42.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.50% over the past year.
Measured over the past years, ALK shows a decrease in Earnings Per Share. The EPS has been decreasing by -5.48% on average per year.
ALK shows a strong growth in Revenue. In the last year, the Revenue has grown by 27.81%.
The Revenue has been growing slightly by 5.97% on average over the past years.
EPS 1Y (TTM)12.5%
EPS 3Y-6.46%
EPS 5Y-5.48%
EPS Q2Q%-30.2%
Revenue 1Y (TTM)27.81%
Revenue growth 3Y23.86%
Revenue growth 5Y5.97%
Sales Q2Q%27.86%
3.2 Future
Based on estimates for the next years, ALK will show a very strong growth in Earnings Per Share. The EPS will grow by 23.64% on average per year.
The Revenue is expected to grow by 11.47% on average over the next years. This is quite good.
EPS Next Y-32.71%
EPS Next 2Y13.39%
EPS Next 3Y23.64%
EPS Next 5YN/A
Revenue Next Year22%
Revenue Next 2Y14.15%
Revenue Next 3Y11.47%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.18, which indicates a very decent valuation of ALK.
Based on the Price/Earnings ratio, ALK is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
ALK's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.40.
The Price/Forward Earnings ratio is 7.59, which indicates a rather cheap valuation of ALK.
Based on the Price/Forward Earnings ratio, ALK is valued cheaply inside the industry as 80.95% of the companies are valued more expensively.
ALK's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.18 | ||
| Fwd PE | 7.59 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ALK is valued a bit cheaper than 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 4.59 |
4.3 Compensation for Growth
A more expensive valuation may be justified as ALK's earnings are expected to grow with 23.64% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y13.39%
EPS Next 3Y23.64%
5. Dividend
5.1 Amount
ALK does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
47.31
-0.47 (-0.98%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryPassenger Airlines
Earnings (Last)
Earnings (Next)
Inst Owners91.09%
Inst Owner Change-0.63%
Ins Owners0.57%
Ins Owner Change-0.33%
Market Cap5.46B
Analysts82
Price Target69.16 (46.18%)
Short Float %5.79%
Short Ratio2.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.24%
Min EPS beat(2)-1.79%
Max EPS beat(2)14.26%
EPS beat(4)3
Avg EPS beat(4)32.84%
Min EPS beat(4)-1.79%
Max EPS beat(4)116.17%
EPS beat(8)6
Avg EPS beat(8)26.47%
EPS beat(12)8
Avg EPS beat(12)16.3%
EPS beat(16)12
Avg EPS beat(16)14.83%
Revenue beat(2)1
Avg Revenue beat(2)-0.91%
Min Revenue beat(2)-2%
Max Revenue beat(2)0.19%
Revenue beat(4)3
Avg Revenue beat(4)0.5%
Min Revenue beat(4)-2%
Max Revenue beat(4)1.9%
Revenue beat(8)4
Avg Revenue beat(8)-0.58%
Revenue beat(12)5
Avg Revenue beat(12)-0.57%
Revenue beat(16)9
Avg Revenue beat(16)-0.16%
PT rev (1m)4.63%
PT rev (3m)7.46%
EPS NQ rev (1m)-6.67%
EPS NQ rev (3m)-31.18%
EPS NY rev (1m)-3.47%
EPS NY rev (3m)-12.56%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)-1.02%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.18 | ||
| Fwd PE | 7.59 | ||
| P/S | 0.41 | ||
| P/FCF | N/A | ||
| P/OCF | 3.82 | ||
| P/B | 1.38 | ||
| P/tB | 14.59 | ||
| EV/EBITDA | 4.59 |
EPS(TTM)4.23
EY8.94%
EPS(NY)6.24
Fwd EY13.18%
FCF(TTM)-0.07
FCFYN/A
OCF(TTM)12.38
OCFY26.16%
SpS116.62
BVpS34.19
TBVpS3.24
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.57% | ||
| ROE | 7.94% | ||
| ROCE | 6.12% | ||
| ROIC | 4.44% | ||
| ROICexc | 5.3% | ||
| ROICexgc | 7.82% | ||
| OM | 5.99% | ||
| PM (TTM) | 2.33% | ||
| GM | 56.32% | ||
| FCFM | N/A |
ROA(3y)1.34%
ROA(5y)-0.4%
ROE(3y)5.42%
ROE(5y)-3.09%
ROIC(3y)5.24%
ROIC(5y)N/A
ROICexc(3y)6.57%
ROICexc(5y)N/A
ROICexgc(3y)9.14%
ROICexgc(5y)N/A
ROCE(3y)7.22%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y-7.41%
ROICexc growth 3YN/A
ROICexc growth 5Y-9.28%
OM growth 3YN/A
OM growth 5Y-9.13%
PM growth 3Y-24.24%
PM growth 5Y-17.41%
GM growth 3Y3.86%
GM growth 5Y0.81%
F-Score6
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.94 | ||
| Cap/Depr | 198.75% | ||
| Cap/Sales | 10.67% | ||
| Interest Coverage | 4.01 | ||
| Cash Conversion | 93.39% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 1.17 |
F-Score6
WACC8.08%
ROIC/WACC0.55
Cap/Depr(3y)317.88%
Cap/Depr(5y)215.36%
Cap/Sales(3y)14.19%
Cap/Sales(5y)10.61%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)12.5%
EPS 3Y-6.46%
EPS 5Y-5.48%
EPS Q2Q%-30.2%
EPS Next Y-32.71%
EPS Next 2Y13.39%
EPS Next 3Y23.64%
EPS Next 5YN/A
Revenue 1Y (TTM)27.81%
Revenue growth 3Y23.86%
Revenue growth 5Y5.97%
Sales Q2Q%27.86%
Revenue Next Year22%
Revenue Next 2Y14.15%
Revenue Next 3Y11.47%
Revenue Next 5YN/A
EBIT growth 1Y4.4%
EBIT growth 3YN/A
EBIT growth 5Y-3.7%
EBIT Next Year94.04%
EBIT Next 3Y43.4%
EBIT Next 5YN/A
FCF growth 1Y98.78%
FCF growth 3Y-37.18%
FCF growth 5Y-29.16%
OCF growth 1Y40.59%
OCF growth 3Y12.43%
OCF growth 5Y-3.19%