Why did SKYW's EPS consistently beat forecasts in 2024?

SkyWest's (SKYW) EPS consistently beat forecasts in 2024 due to a combination of factors that contributed to the company's strong financial performance: 1. **Strategic Fleet Management**: SkyWest has been effective in managing its fleet, which has allowed the company to capitalize on increased air travel demand. The acquisition of additional aircraft and the expansion of its fleet have enabled SkyWest to increase its capacity and meet the growing demand for air travel. 2. **Capacity Purchase Agreements**: The company's revenue model, which includes capacity purchase agreements with major airlines, has been a key driver of its financial success. These agreements provide SkyWest with a stable and predictable source of revenue, which has allowed the company to generate strong earnings. 3. **Airport Services and Leasing**: In addition to capacity purchase agreements, SkyWest also generates revenue through airport services and leasing of aircraft to third parties. While this segment contributes relatively little to the company's overall revenue, it provides an additional stream of income and helps to diversify SkyWest's business. 4. **Financial Discipline**: SkyWest has managed its finances effectively, maintaining a debt-to-capital ratio that is in line with the broader industry. This has allowed the company to maintain a strong balance sheet and invest in its fleet without overextending itself financially. 5. **Industry Position**: SkyWest's position as a regional airline has allowed it to capitalize on the growth in air travel demand, particularly in the North American market. The company's focus on providing reliable and consistent services to its major airline partners has reinforced its position for long-term success. In summary, SkyWest's ability to consistently beat EPS forecasts in 2024 can be attributed to its strategic fleet management, capacity purchase agreements, airport services and leasing, financial discipline, and industry position. These factors have combined to enable the company to generate strong earnings and maintain a solid financial performance.