Analyzing Spirit Airlines (NASDAQ:SAVE) and Frontier Group (NASDAQ:ULCC)

Frontier Group (NASDAQ:ULCCGet Rating) and Spirit Airlines (NASDAQ:SAVEGet Rating) are both mid-cap transportation companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, risk, profitability, analyst recommendations, institutional ownership and valuation.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Frontier Group and Spirit Airlines, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Frontier Group 0 0 8 0 3.00
Spirit Airlines 0 0 0 0 N/A

Frontier Group presently has a consensus price target of $20.08, suggesting a potential upside of 118.22%. Given Frontier Group’s higher possible upside, equities research analysts plainly believe Frontier Group is more favorable than Spirit Airlines.

Institutional & Insider Ownership

99.5% of Frontier Group shares are owned by institutional investors. Comparatively, 62.3% of Spirit Airlines shares are owned by institutional investors. 85.8% of Frontier Group shares are owned by company insiders. Comparatively, 0.4% of Spirit Airlines shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Frontier Group and Spirit Airlines’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Frontier Group -5.51% -45.52% -5.56%
Spirit Airlines -14.85% -16.82% -4.12%

Valuation & Earnings

This table compares Frontier Group and Spirit Airlines’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Frontier Group $2.06 billion 0.97 -$102.00 million ($0.62) -14.84
Spirit Airlines $3.23 billion 0.64 -$472.57 million ($5.18) -3.67

Frontier Group has higher earnings, but lower revenue than Spirit Airlines. Frontier Group is trading at a lower price-to-earnings ratio than Spirit Airlines, indicating that it is currently the more affordable of the two stocks.

Summary

Frontier Group beats Spirit Airlines on 8 of the 12 factors compared between the two stocks.

Frontier Group Company Profile (Get Rating)

Frontier Group Holdings, Inc., a low-fare airline company, provides air transportation for passengers. The company operates an airline that serves approximately 120 airports throughout the United States and international destinations in the Americas. It offers its services through direct distribution channels, including its website, mobile app, and call center. As of December 31, 2021, the company had a fleet of 110 Airbus single-aisle aircraft comprising, 16 A320ceos, 73 A320neos, and 21 A321ceos. Frontier Group Holdings, Inc. was incorporated in 2013 and is headquartered in Denver, Colorado.

Spirit Airlines Company Profile (Get Rating)

Spirit Airlines, Inc. provides airline services. It serves 85 destinations in 16 countries in the United States, Latin America, and the Caribbean. As of December 31, 2021, the company had a fleet of 173 Airbus single-aisle aircraft. It sells tickets through its call centers and airport ticket counters, as well as online through spirit.com; and through various third parties, including online, traditional travel agents, and electronic global distribution systems. The company was formerly known as Clippert Trucking Company and changed its name to Spirit Airlines, Inc. in 1992. Spirit Airlines, Inc. was founded in 1964 and is headquartered in Miramar, Florida.

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