Ultra-low-cost carrier Frontier Group Holdings, Inc. (ULCC) is expanding its fleet and has ordered 91 more Airbus (EADSF) A321neo aircraft. The order forms a part of a larger joint aircraft order across the Indigo Partners portfolio.
Based out of Colorado, Frontier Group offers flight services to over 100 destinations in the U.S., Mexico, the Caribbean and Latin America.
Shares of the company closed 2.6% up on Monday. They gained another 1.6% in the extended trading session to end the day at $16.99.
Frontier Group expects to take delivery of the new aircraft between 2023 and 2029. These are in addition to the order of 143 aircraft that are scheduled to be delivered between 2022 and 2028.
Of the total 234 aircraft, 158 are A321neo and 76 are A320neo. (See Insiders’ Hot Stocks on TipRanks)
The President and CEO of Frontier Airlines, Barry Biffle, said, “These additional A321neo aircraft will enable us to triple the size of the airline by 2029.”
“We are already America’s Greenest Airline with an existing fleet that is 43% more fuel-efficient, on average per seat, than other U.S. carriers. The A321neo is expected to deliver nearly 120 ASMs per gallon, further advancing our industry-leading environmental efforts while debunking the myth that being green is an expensive investment only achievable in the future,” Biffle added.
Frontier’s current fleet size stands at 112, and it aims to increase it to 272 aircraft by the end of 2029.
Overall, the stock has a Strong Buy consensus rating based on 5 Buys and 1 Hold. The average Frontier Group Holdings price target of $21.83 implies 30.6% upside potential. Shares have lost nearly 17% over the past six months.
According to TipRanks’ Smart Score rating system, Frontier scores a 9 out of 10, suggesting that the stock is likely to outperform market averages.