Financial Analysis: Alaska Air Group (ALK) versus JetBlue Airways Corporation (JBLU)
Alaska Air Group (NYSE: ALK) and JetBlue Airways Corporation (NASDAQ:JBLU) are both mid-cap transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, earnings, valuation, analyst recommendations, institutional ownership and profitability.
This is a summary of recent recommendations for Alaska Air Group and JetBlue Airways Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alaska Air Group||0||2||8||0||2.80|
|JetBlue Airways Corporation||1||8||5||0||2.29|
Alaska Air Group presently has a consensus price target of $101.56, suggesting a potential upside of 27.34%. JetBlue Airways Corporation has a consensus price target of $25.09, suggesting a potential upside of 30.07%. Given JetBlue Airways Corporation’s higher probable upside, analysts plainly believe JetBlue Airways Corporation is more favorable than Alaska Air Group.
Alaska Air Group pays an annual dividend of $1.20 per share and has a dividend yield of 1.5%. JetBlue Airways Corporation does not pay a dividend. Alaska Air Group pays out 19.5% of its earnings in the form of a dividend. Alaska Air Group has increased its dividend for 3 consecutive years.
Insider & Institutional Ownership
87.8% of Alaska Air Group shares are owned by institutional investors. Comparatively, 84.5% of JetBlue Airways Corporation shares are owned by institutional investors. 0.6% of Alaska Air Group shares are owned by company insiders. Comparatively, 0.6% of JetBlue Airways Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Risk and Volatility
Alaska Air Group has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, JetBlue Airways Corporation has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500.
This table compares Alaska Air Group and JetBlue Airways Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alaska Air Group||11.02%||30.04%||9.14%|
|JetBlue Airways Corporation||9.78%||16.75%||6.99%|
Valuation and Earnings
This table compares Alaska Air Group and JetBlue Airways Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Alaska Air Group||$6.94 billion||1.42||$1.84 billion||$6.16||12.95|
|JetBlue Airways Corporation||$6.82 billion||0.93||$1.54 billion||$1.97||9.79|
Alaska Air Group has higher revenue and earnings than JetBlue Airways Corporation. JetBlue Airways Corporation is trading at a lower price-to-earnings ratio than Alaska Air Group, indicating that it is currently the more affordable of the two stocks.
Alaska Air Group beats JetBlue Airways Corporation on 14 of the 17 factors compared between the two stocks.
Alaska Air Group Company Profile
Alaska Air Group, Inc. is the holding company of Alaska Airlines (Alaska), Virgin America Inc., Horizon Air (Horizon) and other business units. The Company operates through three segments: Mainline, Regional and Horizon. Its Mainline segment includes Alaska’s and Virgin America’s scheduled air transportation for passengers and cargo throughout the United States, and in parts of Canada, Mexico, Costa Rica and Cuba. Its Regional segment includes Horizon’s and other third-party carriers’ scheduled air transportation for passengers across a shorter distance network within the United States under capacity purchased arrangements (CPAs). Its Horizon segment includes the capacity sold to Alaska under CPA. Alaska and Virgin America operate fleets of narrowbody passenger jets. As of December 31, 2016, it maintained two frequent flyer plans: the Alaska Airlines Mileage Plan and the Virgin America Elevate.
JetBlue Airways Corporation Company Profile
JetBlue Airways Corporation is a passenger carrier company. The Company provides air transportation services across the United States, the Caribbean and Latin America. Its segments include Domestic, and Caribbean & Latin America. It operates various kinds of aircrafts, including Airbus A321, Airbus A320 and Embraer E190. It also provides premium transcontinental product called Mint. As of December 31, 2016, Mint included 16 fully lie-flat seats, four of which were in suites with a privacy door. The Company also provides Fly-Fi in-flight Internet service across its Airbus fleet. It provides its customers a choice to purchase tickets from three branded fares, which include Blue, Blue Plus and Blue Flex. Each of these fare include different offerings, such as free checked bags, reduced change fees and additional TrueBlue points. As of December 31, 2016, its Airbus A321 aircraft in a single cabin layout had 200 seats and those with Mint premium service had a seating capacity of 159 seats.
Receive News & Ratings for Alaska Air Group Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Alaska Air Group Inc. and related companies with MarketBeat.com's FREE daily email newsletter.