Earnings Preview: Hawaiian Holdings, Inc. (HA)
By:NewsyStocks   Friday, January 27, 2022 12:37 PM

Hawaiian Holdings is scheduled to release its fourth quarter earnings on Tuesday, January 31. In a recent press release highlighting traffic stats for 2011, the company reported a new record of 8.67 million passengers flown in a year.

Hawaiian Holdings is expected to post earnings per share of $0.28, with estimates ranging from $0.25 to $0.30.

In its business update for 2011, Hawaiian Holdings stated that PRASM (Passenger Revenue per Available Seat Mile) or the unit revenue per passenger would be at the higher end of guidance issued after 3Q. The company also advised that RPMS (Revenue Passenger miles) and ASP (Available Seat Miles) increased 14.5 percent and 16.7 percent year-over-year respectively.

However many other US carriers have revised their fuel guidance upwards and in the case of Hawaiian Holdings this could erode any PRASM gains. 

Deutsche Bank reiterated its Buy rating on HA after management held its investor meet in November stating that the event had a bullish tone to it. Furthermore, it added that Hawaiian Holding has a massive opportunity with international growth especially on Asian routes.

Morgan Stanley has an Equal weight rating on the stock and lists expansion into Asia and improving tourism market as investment positives while concentrated geographic exposure and risk to margins and returns due to expansion and new growth opportunities as negatives.

Analysts maintain a consensus revenue estimate of $431 million for Q4

Hawaiian Holdings reported earnings of $0.59 per share in the third quarter, beating Wall Street estimates and growing 7.2 percent. Operating revenue in the last quarter increased 30 percent to $455.9 million.

Hawaiian Holding has either met or exceeded consensus profit expectations in its last 4 reported quarters.

Our Take

A4A (Airlines for America), an airline industry trade organization which Hawaiian Airline is a part of recently stated that it expected airline traffic over the holiday to drop by 1 percent year-over-year. For the fourth quarter, Hawaiian Holdings advised that passengers grew 2.8 percent. While fuel concerns continue to remain a headwind to margins, Hawaiian Airline's strong performance over 2011 indicates that it is on the right path.  The company's near-monopoly on the Hawaiian Islands leave it with the threat of new entrants but a strong liquidity and expansion plans gives it a strong position.