How Spirit Airlines (USA Stocks:SAVE) unsteady basic indicators helped with the latest dip?

Despite Spirit Airlines' (USA Stocks: SAVE) recent EBIT loss of $348M, the company's fundamentals show potential for a strategic investment during the current market dip. With a low debt-to-equity ratio of 2.88% and a substantial total asset base of $9.42B, Spirit Airlines presents a viable opportunity for investors seeking to leverage the volatility of the airline industry.

Main Considerations

Spirit Airlines has a beta of 1.56, indicating a relatively high market risk. The company is expected to outperform the market when it rises, but underperform during market downturns. Currently, Spirit Airlines has a projected negative return of -0.28%. It's crucial to assess Spirit Airlines' maximum drawdown and the correlation between accumulation distribution and the typical daily price. This will help predict if past performance will recur in the near future.
Published over two weeks ago
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Reviewed by Vlad Skutelnik

Navigating the turbulent skies of the stock market, Spirit Airlines (NYSE: SAVE) presents an intriguing investment opportunity amidst the recent market dip. With a Beta of 1.4, the stock exhibits higher volatility than the market, which can be leveraged for potential gains. Despite the airline industry's challenges, Spirit Airlines has managed to maintain a substantial cash position, with end period cash flow of $984.6M and cash and equivalents totaling $1.06B. However, the company's fundamentals reveal a mixed picture. The Return on Assets stands at -0.03, indicating a loss in efficiency in generating profit from its assets. The current ratio of 0.93X suggests a slight liquidity risk, as the company may struggle to cover its short-term obligations. Furthermore, the probability of bankruptcy is relatively high at 46.65%, reflecting the inherent risks in the airline industry, particularly in the current economic climate. On the brighter side, Spirit Airlines holds a total stockholder equity of $1.1B, and a book value per share of 9.15X, which is significantly higher than its price book of 0.4034. This discrepancy suggests that the stock may be undervalued, providing an attractive entry point for investors. In conclusion, while Spirit Airlines faces some financial headwinds, its volatile fundamentals and potential undervaluation could offer a rewarding investment opportunity for those willing to weather the storm. Currently, Spirit Airlines' Enterprise Value is anticipated to rise significantly, based on recent years' reports. The Book Value Per Share for this year is projected to increase to 10.78, while the Ptb Ratio is expected to drop to 1.16. Spirit Airlines is set to announce its earnings today. The passenger airlines sector appears to be heating up again, so it's worth examining if Spirit Airlines is emitting bullish signals to investors. We'll assess why Spirit Airlines' recent price movements suggest a potential upswing in July. The airline's current probability of distress is less than 43%. The question remains: will shareholders maintain their optimism, or could a sell-off be on the horizon?
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include Spirit Airlines income statement, its balance sheet, and the statement of cash flows. Potential Spirit Airlines investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Spirit Airlines investors may use each financial statement separately, they are all related. The changes in Spirit Airlines's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Spirit Airlines's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of Spirit Airlines fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Spirit Airlines performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Spirit Airlines shares is the value that is considered the true value of the share. If the intrinsic value of Spirit is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares Spirit Airlines. Please read more on our fundamental analysis page.

How effective is Spirit Airlines in utilizing its assets?

Spirit Airlines reports assets on its Balance Sheet. It represents the amount of Spirit resources that either has an existing economic value or will provide some form of benefits in the future. By effectively utilizing its assets, Spirit Airlines aims to generate revenue, control costs, drive operational efficiency, and enhance profitability. Optimizing asset utilization helps maximize shareholder value and maintain a competitive position in the Passenger Airlines space. To get a better handle on how balance sheet or income statements item affect Spirit volatility, please check the breakdown of all its fundamentals.

Are Spirit Airlines Earnings Expected to grow?

The future earnings power of Spirit Airlines involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of Spirit Airlines factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. Spirit Airlines stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of Spirit expected earnings.

And What about dividends?

A dividend is the distribution of a portion of Spirit Airlines earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Spirit Airlines dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Spirit one year expected dividend income is about USD0.5 per share.
The current year's Dividends Paid is expected to grow to about 742 M. The current year's Dividend Paid And Capex Coverage Ratio is expected to grow to 0.93.
Last ReportedProjected for Next Year
Dividends Paid706.7 M742 M
Dividend Paid And Capex Coverage Ratio 0.89  0.93 
Investing in dividend-paying stocks, such as Spirit Airlines is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Spirit Airlines must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Spirit Airlines. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

Spirit Airlines Gross Profit

Spirit Airlines Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Spirit Airlines previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Spirit Airlines Gross Profit growth over the last 10 years. Please check Spirit Airlines' gross profit and other fundamental indicators for more details.

Another angle On Spirit Airlines

The latest Spirit Airlines price dip created some momentum for shareholders as it was traded today as low as 3.46 and as high as 3.65 per share. The company executives were unable to exploit market volatilities in May. However, diversifying your overall positions with Spirit Airlines can protect your principal portfolio during market swings. The stock standard deviation of daily returns for 90 days investing horizon is currently 4.86. This high volatility is attributed to the latest market swings and not-so-good earnings reports for some of the Spirit Airlines partners.
Please be aware that individual investors typically purchase shares for their personal accounts and usually in smaller quantities compared to institutional investors. While they might influence Spirit Airlines' decisions if they own a significant combined portion of its shares, such influence is relatively rare. Conversely, institutional investors - like mutual funds, pension funds, hedge funds, and other investment companies - often have a substantial sway over Spirit Airlines' decisions due to their larger holdings.
 2021 2022 2023 2024 (projected)
Graham Number45.1540.7130.9627.75
Receivables Turnover19.3821.726.124.79

Asset Utilization

The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Spirit Airlines has an asset utilization ratio of 56.94 percent. This indicates that the Company is making $0.57 for each dollar of assets. An increasing asset utilization means that Spirit Airlines is more efficient with each dollar of assets it utilizes for everyday operations.
Non Current Assets Total
8.3 B
Net Tangible Assets
4.9 B
Non Current Assets Total8.3 Billion52.88
Non Currrent Assets Other248.3 Million1.58
Other Current Assets179.27 Million1.14
Total Current Assets1.14 Billion7.27
Other Assets963.8 Million6.14
Net Tangible Assets4.86 Billion30.98
Intangible Assets0.00.0
"Buy when there's blood in the streets," goes the old investment adage, and Spirit Airlines (USA Stocks: SAVE) may just be the opportunity savvy investors are looking for amidst the recent market dip. Despite a challenging year reflected in a net loss of $534.5M from continuing operations and negative cash flow from operating activities of $246.7M, Spirit Airlines' fundamentals present a compelling case. The company's PEG ratio stands at a hefty 20.44, indicating potential for significant growth. Furthermore, with a market capitalization of $433.62M and a price to earnings ratio of 4.55X, the stock appears undervalued. Lastly, the company's shares are largely held by institutions at 42.07%, suggesting confidence from large-scale investors.

Can Spirit Airlines correct the latest dip?

Spirit Airlines' total risk alpha indicator has recently dropped to -0.55, hinting at potential price growth. This negative value suggests underperformance, yet also signals a possible correction opportunity. With the company's robust fundamentals and the travel industry's gradual recovery, Spirit Airlines may rebound from its recent dip. Investors should keep a close eye on the stock for signs of recovery. The airline's stock exhibits low volatility, with a skewness of 0.72 and kurtosis of 1.42. Understanding market volatility trends can help investors time their trades.
Using volatility indicators correctly allows traders to gauge Spirit Airlines' stock risk against market volatility during both bullish and bearish trends. The heightened volatility of bear markets can directly affect Spirit Airlines' stock price, causing investor stress as share values drop, often prompting portfolio rebalancing through the purchase of diverse financial instruments.In conclusion, despite the negative headlines, Spirit Airlines' financial situation is not as dire as it may seem. With a valuation market value of 3.5 and a valuation real value of 7.3, the company's fundamentals remain strong. The analyst overall consensus is a 'Hold', with 7 holds, 3 sells, and 2 strong sells. The possible downside price is a mere 0.035, while the possible upside price is a substantial 8.23. The analyst target price estimated value stands at 18.75, with the lowest and highest estimated target prices being 17.06 and 20.81 respectively. Thus, while Spirit Airlines may be facing some turbulence, the potential for recovery and growth remains..

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Gabriel Shpitalnik do not own shares of Spirit Airlines. Please refer to our Terms of Use for any information regarding our disclosure principles.

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