SkyWest Inc. (SKYW, Financial) reported first-quarter revenue of $948 million, narrowly surpassing the analyst consensus of $946.9 million. This performance comes amid a backdrop of economic uncertainty affecting the airline industry.
Despite these challenges, SkyWest's demand remains strong. The company continues to focus on enhancing its partners' network strategies and improving services to smaller communities. Additionally, SkyWest is strategically investing in its fleet to capitalize on long-term opportunities.
President and CEO Chip Childs expressed gratitude towards the team's efforts in maintaining high service standards during a challenging winter season. This dedication has been instrumental in SkyWest's ability to navigate the current economic climate while continuing to deliver value.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 5 analysts, the average target price for SkyWest Inc (SKYW, Financial) is $114.20 with a high estimate of $130.00 and a low estimate of $97.00. The average target implies an upside of 27.88% from the current price of $89.30. More detailed estimate data can be found on the SkyWest Inc (SKYW) Forecast page.
Based on the consensus recommendation from 5 brokerage firms, SkyWest Inc's (SKYW, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for SkyWest Inc (SKYW, Financial) in one year is $65.06, suggesting a downside of 27.14% from the current price of $89.3. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the SkyWest Inc (SKYW) Summary page.
SKYW Key Business Developments
Release Date: January 30, 2025
- Net Income (Q4 2024): $97 million or $2.34 per diluted share.
- Net Income (Full Year 2024): $323 million or $7.77 per diluted share.
- Total Revenue (Q4 2024): $944 million, up 3% from Q3 2024 and up 26% from Q4 2023.
- Contract Revenue (Q4 2024): $786 million, up 3% from Q3 2024 and up 27% from Q4 2023.
- Pro Rate and Charter Revenue (Q4 2024): $126 million, up 3% from Q3 2024 and up 14% from Q4 2023.
- Leasing and Other Revenue (Q4 2024): $32 million, up 8% from Q3 2024 and up 34% from Q4 2023.
- Cash (End of Q4 2024): $802 million.
- Debt (End of Q4 2024): $2.7 billion, down from $3 billion at year-end 2023.
- Free Cash Flow (2024): Over $500 million.
- CapEx (Q4 2024): $186 million, up from $97 million in Q3 2024.
- Deferred Revenue (End of Q4 2024): $322 million.
- Share Repurchase (2024): 11.2 million shares repurchased for $332 million.
- Block Hours (2024): Increased by approximately 13% compared to 2023.
- Expected Block Hours Increase (2025): Approximately 12% over 2024.
- Expected CapEx (2025): Approximately $600 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- SkyWest Inc (SKYW, Financial) reported a net income of $97 million for Q4 2024, reflecting strong financial performance.
- The company successfully extended a multiyear contract with American Airlines for 74 CRJ 700 aircraft, ensuring long-term revenue stability.
- SkyWest Inc (SKYW) achieved a 99.9% adjusted completion rate, demonstrating operational efficiency and reliability.
- The company is set to receive 16 new E175 aircraft by the end of 2026, enhancing its fleet and market position.
- SkyWest Inc (SKYW) has a strong balance sheet with $802 million in cash and has significantly reduced its debt, providing financial flexibility for future growth.
Negative Points
- SkyWest Inc (SKYW) faces challenges in its third-party MRO network, including labor and parts shortages, which could impact maintenance costs and aircraft availability.
- The company anticipates increased aircraft maintenance expenses in 2025, which could affect profitability.
- SkyWest Inc (SKYW) is still working to restore pilot staffing levels to pre-COVID levels, which could limit operational capacity.
- The tragic collision involving a military aircraft and an American Eagle aircraft highlights potential safety concerns in the aviation industry.
- SkyWest Inc (SKYW) has a significant amount of deferred revenue, which could impact future financial results if not managed effectively.
