The Unprecedented Rise of Alaska Air Group Inc. (ALK)

The Unprecedented Rise of Alaska Air Group Inc. (ALK)


Many stocks have been testing new highs in 2020, and one of the most notable is Alaska Air Group Inc. (ALK). Currently, ALK is trading at $50.24 and the avg recommendation for the stock is Moderate Buy. while the current analyst price target stands at $40.38.

To add more color to this target, the company’s high over the last year is $72.22 and the low is $20.02. Over the last 52 weeks, ALK is down -30.43% while the S&P 500 is up 1.21%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, ALK reported a profit of $-321.0 million. Alaska Air Group Inc. also saw revenues decrease to $1.64 billion. In addition, ALK has free cash flow of -$86.0 million as of 03-2020 The company’s EBITDA came in at -$213.0 million which compares well with its peers.

ALK booked profit margins of 6.20%, its Return on Equity (ROE) is 12.90%, and its Return on Assets is 4.10%. All told, it is clear that, ALK needs to be on your watchlist.

About Alaska Air Group Inc.

If readers are unfamiliar, Alaska Air Group, Inc., through its subsidiaries, provides passenger and cargo air transportation services. The company operates through three segments: Mainline, Regional, and Horizon. It has a network of approximately 1,300 daily flights to 115 destinations across the United States, Mexico, Canada, and Costa Rica. The company was founded in 1932 and is based in Seattle, Washington.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. ALK has a short ratio of 0.88 and outstanding shares of 122.82M.

Company Outlook

ALK has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 5.11 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 4.26. Alaska Air Group Inc. ALK also noted assets of $13.36 billion at the end of the last quarter. Investors should also keep an eye on sector updates as ALK has historically followed its peers on positive news.

All told, Alaska Air Group Inc. ALK has strung together solid data and demonstrated underlying fundamentals. At its current valuation, ALK represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Alaska Air Group Inc. ALK is now commanding a market cap of 6.17B and a float of 122.00M. ALK is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of ALK stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in ALK, either long or short, and we have not been compensated for this article.