Allegiant Travel Company Analysis
Executive Summary
Allegiant Travel Company, parent company of Allegiant Air, is a low-cost airline carrierthat caters exclusively to the leisure traveler. There are currently 980 employees that manage the whole company (allegiantair.com). They are known for their innovative and sustainable business models based on keeping fares low and providing additional services for customers.
Throughout the years, Allegiant has been operating by providing one-way tickets to and from its “focus centers” which are destinations as Orlando, St. Petersburg, Phoenix, Los Angeles, Tampa and Las Vegas (mergentonline.com). However, Allegiant Travel Company purchased six Boeing 757s in March 2010 to expand their destinations to cities outside the USA (Wichita-bizjournals.com). The current routes generally include small, middle class areas populated by middle-aged people with high levels of disposable income.
After analyzing their financial position, this report concludes that Allegiant is a satisfying target for investment. Allegiant has three main sources of revenue which include: service trips, ancillary revenues and fixed-free contracts called charters (stocks.investopedia.com). Even though the economic environment is not at its peak, Allegiant has managed sustained growth. Its low prices have kept demand buoyant, and it is one of the few airlines that saw profits go up in the face of skyrocketing fuel prices. Additionally, their stock prices have increased throughout the years and the values of their shares are increasing.
Financially, Allegiant is not only maintaining their revenue, they are increasing it. Through the calculations of return on investments, return on sales, return on equity and operational efficiency, Allegiant showed consistent improvement. Cash reserves are plentiful, which means that the company has the opportunity to expand in the market. Investors should definitely invest in Allegiant Travel Company.
Allegiant Travel Company | Table of Contents |
Allegiant Travel Company, parent company of Allegiant Air, is a low-cost airline carrierthat caters exclusively to the leisure traveler. There are currently 980 employees that manage the whole company (allegiantair.com). They are known for their innovative and sustainable business models based on keeping fares low and providing additional services for customers.
Throughout the years, Allegiant has been operating by providing one-way tickets to and from its “focus centers” which are destinations as Orlando, St. Petersburg, Phoenix, Los Angeles, Tampa and Las Vegas (mergentonline.com). However, Allegiant Travel Company purchased six Boeing 757s in March 2010 to expand their destinations to cities outside the USA (Wichita-bizjournals.com). The current routes generally include small, middle class areas populated by middle-aged people with high levels of disposable income.
After analyzing their financial position, this report concludes that Allegiant is a satisfying target for investment. Allegiant has three main sources of revenue which include: service trips, ancillary revenues and fixed-free contracts called charters (stocks.investopedia.com). Even though the economic environment is not at its peak, Allegiant has managed sustained growth. Its low prices have kept demand buoyant, and it is one of the few airlines that saw profits go up in the face of skyrocketing fuel prices. Additionally, their stock prices have increased throughout the years and the values of their shares are increasing.
Financially, Allegiant is not only maintaining their revenue, they are increasing it. Through the calculations of return on investments, return on sales, return on equity and operational efficiency, Allegiant showed consistent improvement. Cash reserves are plentiful, which means that the company has the opportunity to expand in the market. Investors should definitely invest in Allegiant Travel Company.
Allegiant Travel Company | Table of Contents |
Cited: "Allegiant - Historic Stock Lookup." Allegiant - Historic Stock Lookup. Allegiant. Web. 15 Apr. 2010. . Allegiant Travel Company (NMS: ALGT). Mergent. Web. 10 Apr. 2010. . Allegiant Travel Company (NMS: ALGT)-Property. Mergent. Web. 10 Apr. 2010.