Air Canada (OTCMKTS:ACDVF) and Allegiant Travel (NASDAQ:ALGT) are both mid-cap transportation companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, dividends, institutional ownership, profitability and analyst recommendations.
Earnings & Valuation
This table compares Air Canada and Allegiant Travel’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Air Canada||$13.94 billion||0.69||$128.84 million||N/A||N/A|
|Allegiant Travel||$1.67 billion||1.64||$159.70 million||$10.00||16.83|
Allegiant Travel has lower revenue, but higher earnings than Air Canada.
Insider & Institutional Ownership
0.1% of Air Canada shares are owned by institutional investors. Comparatively, 79.5% of Allegiant Travel shares are owned by institutional investors. 20.9% of Allegiant Travel shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This is a breakdown of current recommendations and price targets for Air Canada and Allegiant Travel, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Air Canada currently has a consensus target price of $53.00, suggesting a potential upside of 47.67%. Allegiant Travel has a consensus target price of $171.31, suggesting a potential upside of 1.78%. Given Air Canada’s stronger consensus rating and higher probable upside, equities analysts clearly believe Air Canada is more favorable than Allegiant Travel.
Allegiant Travel pays an annual dividend of $2.80 per share and has a dividend yield of 1.7%. Air Canada does not pay a dividend. Allegiant Travel pays out 28.0% of its earnings in the form of a dividend.
This table compares Air Canada and Allegiant Travel’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Allegiant Travel beats Air Canada on 10 of the 14 factors compared between the two stocks.
About Air Canada
Air Canada provides domestic, U.S. transborder, and international airline services. It offers scheduled passenger services under the Air Canada Vacations and Air Canada Rouge brand name in the Canadian market, the Canada-U.S. transborder market, and in the international market to and from Canada, as well as through capacity purchase agreements on other regional carriers. As of December 31, 2018, the company operated a fleet of 184 aircraft under the Air Canada mainline brand name comprising 91 Boeing and Airbus narrow-body aircraft, 74 Boeing and Airbus wide-body aircraft, and 19 Embraer 190 regional jets; and 53 aircraft under the Air Canada Rouge brand name consisting of 22 Airbus A319 aircraft, 6 Airbus A321 aircraft, and 25 Boeing 767-300 aircraft. It also provides air cargo services in domestic and U.S. transborder routes, as well as on international routes between Canada and markets in Europe, Asia, South America, and Australia. In addition, the company operates, develops, markets, and distributes vacation travel packages in the Caribbean, Mexico, the United States, Europe, Central and South America, South Pacific, Australia, and Asia; and offers cruise packages in North America, Europe, and the Caribbean. Air Canada was founded in 1937 and is based in Saint-Laurent, Canada.
About Allegiant Travel
Allegiant Travel Company, a leisure travel company, provides travel services and products to residents of under-served cities in the United States. The company offers scheduled air transportation on limited-frequency, nonstop flights between under-served cities and leisure destinations. As of February 15, 2019, it operated a fleet of 79 Airbus A320 series aircraft. The company also provides air-related services and products in conjunction with air transportation, including convenience fees, baggage fees, advance seat assignments, travel protection products, change fees, priority boarding, food and beverage purchases on board, and other air-related services, as well as use of its call center for purchases. In addition, it offers third party travel products, such as hotel rooms and ground transportation, such as rental cars and hotel shuttle products; and air transportation services through fixed fee agreements and charter service on a year-round and ad-hoc basis. Further, the company leases spare engines to a third party; and offers management solutions to golf courses. Allegiant Travel Company was founded in 1997 and is based in Las Vegas, Nevada.