Allegiant Travel (ALGT) Down 15.4% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Allegiant Travel (ALGT). Shares have lost about 15.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Allegiant Travel due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.

Allegiant Q4 Earnings Beat Estimates

Allegiant reported impressive fourth-quarter 2025 results, wherein both earnings and revenues beat the Zacks Consensus Estimate.

Quarterly earnings of $2.86 per share outpaced the Zacks Consensus Estimate by 42.3% and increased 36.2% year over year. Revenues for the fourth quarter of 2025 were $656.2 million, surpassing the Zacks Consensus Estimate by 1% and rising 4.5% year over year.

Operating revenues of $656.2 million rose 7.6% on a year-over-year basis. Passenger revenues, which accounted for the bulk (90.8%) of the top line, grew 7.6% on a year-over-year basis.

Air traffic (measured in revenue passenger miles) for scheduled services grew 12% year over year in the quarter under review. Capacity (measured in available seat miles or ASMs) grew 10.5% from the year-ago number. The load factor (percentage of seats filled by passengers) increased to 81.2% from 80.2% in the reported quarter, as traffic growth did not outperform capacity expansion.

Airline operating costs per available seat miles, excluding fuel, fell 3.4% year over year to 8.01 cents. The average fuel cost per gallon (scheduled) increased 4.4% year over year to $2.61. Total scheduled service passenger revenues per available seat mile fell to 12.67 cents from 13.01 cents a year ago.

ALGT’s Liquidity

As of Dec. 31, 2025, Allegiant’s total unrestricted cash and investments were $838.5 million compared with $832.5 million at the prior-quarter end. Long-term debt and finance lease obligations (net of current maturities and related costs) totaled $1.68 billion compared with $1.61 billion at the end of 2024.

Allegiant’s Guidance for Q1 & 2026

For the first quarter of 2026, ASM (for scheduled service) is expected to decrease 5.7% on a year-over-year basis. Total system ASM is projected to fall 5.7% on a year-over-year basis.

Adjusted EPS are anticipated to be in the $2.50 to $3.50 range. First-quarter adjusted operating margin is expected to lie between 12% and 15%. The fuel cost per gallon is suggested to be $2.60.

For 2026, ASM (for scheduled service) is expected to decrease 0.5% on a year-over-year basis. Total system ASM is projected to fall 0.5% on a year-over-year basis. Interest expenses are forecasted to be in the range of $125-$135 million. The fuel cost per gallon is suggested to be $2.50. The company expects the 2026 tax rate to be 23%.

For 2026, adjusted earnings per share (EPS) are expected to be above $8.00.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 37.99% due to these changes.

VGM Scores

Currently, Allegiant Travel has a average Growth Score of C, however its Momentum Score is doing a lot better with an A. Following the exact same course, the stock has a score of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Allegiant Travel has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

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Allegiant Travel Company (ALGT): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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