Alaska Air Group Q1 Earnings Preview: Attention Turns To Boeing Safety, Merger With Hawaiian Airlines

Airline company Alaska Air Group, Inc. ALK is set to report first-quarter financial results before market opens Thursday, April 18.

Here are the key earnings estimates and items to watch.

Earnings Estimates: Analysts estimate Alaska Air will report first-quarter revenue of $2.19 billion, according to data from Benzinga Pro.

The company reported revenue of $2.196 billion in last year's first quarter. Alaska Air has beaten revenue estimates from analysts in three of the past five quarters.

Analysts expect the company to report a loss of $1.05 per share in the first quarter, compared to a loss of 62 cents per share in last year's first quarter. The company missed analysts’ estimates for earnings per share in three of the past five quarters.

Guidance from the company previously said it expected to hit earnings per share of $3 to $5 for the full fiscal 2024 year.

Related Link: Compensation Package: Boeing Assists Alaska Air with $160M Amid Crisis

Key Items to Watch: Alaska Air is among the airline stocks impacted by safety concerns from airplanes made by Boeing Co BA.

A Jan. 5 flight on a Boeing 737 MAX 9 flown by Alaska Airlines saw a plug door blow and an emergency landing was required. Alaska Airlines was forced to ground its Boeing planes for inspection.

As part of its fourth-quarter earnings, Alaska Air said it had completed final inspections of all its Boeing 737 MAX 9 planes and that a return to service would happen soon.

In December, Alaska Air announced a merger with Hawaiian Holdings, Inc. HA. The merger agreement is now under further investigation as a group of passengers, which includes former travel agents, filed a lawsuit Monday. The lawsuit alleges that the merger could harm air travel competition.

"The current trend toward concentration, the lessening of competition and the tendency to create a monopoly in the airlines industry is unmatched, unparalleled, and dangerous," the lawsuit said, as shared by CNBC.

The merger is under current antitrust review by the U.S. Justice Department. The Justice Department recently blocked a $3.8 billion merger between JetBlue and Spirit Airlines, which saw the companies call off the planned tie-up.

An update on the timeline and any comment on the new lawsuit is one item to watch from the first-quarter financial report.

On Wednesday morning, Alaska Airlines saw an issue reported while upgrading its system that calculates weight and balance. The airline's flights were paused as it worked to resolve the issue.

The earnings report from Alaska Air comes after peers Delta Air Lines, Inc. DAL and United Airlines Holdings Inc UAL reported quarterly results. Both airlines reported better-than-expected numbers and saw shares rise.

Earlier this week, United Airlines reported earnings per share and revenue, which both came in ahead of Street estimates. The company also expressed confidence in Boeing planes, adding that the grounding of planes cost it around $200 million.

Investors could be looking for the updated financial impact for Alaska Air, with the airline company previously saying it expected a $150 million negative impact from the grounding.

ALK Price Action: Alaska Air shares were up 3.31% at $42.15 on Wednesday at publication versus a 52-week trading range of $30.75 to $57.17. Shares of Alaska Air are up 7.1% year-to-date in 2024.

Read Next: American Airlines Vs. Alaska Air: Which Is The Better Buy Heading Into Q4 Earnings?

Photo: Chad Slattery, Courtesy Alaska Air