In a report released today, Andrew Didora from Bank of America Securities reiterated a Sell rating on Allegiant Travel Company (ALGT – Research Report), with a price target of $50.00.
Andrew Didora has given his Sell rating due to a combination of factors impacting Allegiant Travel Company. Primarily, the company’s off-peak pricing is not performing as well as peak levels, which has led to a lower-than-expected outlook for unit revenue and earnings per share (EPS) in the second quarter. Additionally, while there has been some stabilization in demand, the management has indicated that further capacity cuts may be necessary if demand weakens further.
Moreover, the macroeconomic environment presents challenges, and Allegiant faces specific risks that contribute to the underperformance rating. The company’s 2025 EPS estimate has been revised downward due to increased interest expenses, although the EBITDAR forecast remains largely unchanged. Despite some recent signs of demand improvement, the overall outlook remains cautious, with capacity growth plans already being adjusted downward. These factors collectively support the Sell rating with a price objective of $50.