Head-To-Head Contrast: Allegiant Travel (ALGT) & United Continental (UAL)

Allegiant Travel (NASDAQ:ALGT) and United Continental (NASDAQ:UAL) are both transportation companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.

Dividends

Allegiant Travel pays an annual dividend of $2.80 per share and has a dividend yield of 2.0%. United Continental does not pay a dividend. Allegiant Travel pays out 28.0% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Allegiant Travel and United Continental’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Allegiant Travel $1.67 billion 1.35 $161.80 million $10.00 13.92
United Continental $41.30 billion 0.58 $2.13 billion $9.13 9.67

United Continental has higher revenue and earnings than Allegiant Travel. United Continental is trading at a lower price-to-earnings ratio than Allegiant Travel, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Allegiant Travel and United Continental’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allegiant Travel 9.70% 25.58% 6.84%
United Continental 5.15% 27.73% 5.67%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Allegiant Travel and United Continental, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allegiant Travel 1 3 7 0 2.55
United Continental 1 4 11 0 2.63

Allegiant Travel currently has a consensus price target of $152.82, suggesting a potential upside of 9.78%. United Continental has a consensus price target of $101.13, suggesting a potential upside of 14.51%. Given United Continental’s stronger consensus rating and higher probable upside, analysts clearly believe United Continental is more favorable than Allegiant Travel.

Volatility & Risk

Allegiant Travel has a beta of 0.91, suggesting that its share price is 9% less volatile than the S&P 500. Comparatively, United Continental has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Insider & Institutional Ownership

89.7% of Allegiant Travel shares are held by institutional investors. Comparatively, 99.2% of United Continental shares are held by institutional investors. 20.8% of Allegiant Travel shares are held by company insiders. Comparatively, 0.3% of United Continental shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

United Continental beats Allegiant Travel on 9 of the 16 factors compared between the two stocks.

Allegiant Travel Company Profile

Allegiant Travel Company, a leisure travel company, focuses on the provision of travel services and products to residents of under-served cities in the United States. The company offers scheduled air transportation on limited frequency nonstop flights between under-served cities and leisure destinations. As of May 23, 2018, it operated a fleet of 99 Airbus aircraft. The company also provides air-related services and products in conjunction with air transportation, including convenience fees, baggage fees, advance seat assignments, travel protection products, change fees, priority boarding, food and beverage purchases on board, and other air-related services, as well as use of its call center for purchases. In addition, it offers third party travel products, such as hotel rooms, ground transportation, and attractions; and air transportation services through fixed fee agreements and charter service on a year-round and ad-hoc basis. Further, the company offers leases spare engines to a third party; and offers management solutions to golf courses. Allegiant Travel Company was founded in 1997 and is based in Las Vegas, Nevada.

United Continental Company Profile

United Continental Holdings, Inc., together with its subsidiaries, provides air transportation services in North America, the Asia-Pacific, Europe, the Middle East, Africa, and Latin America. It transports people and cargo through its mainline and regional operations. As of December 31, 2017, the company operated a fleet of 1,262 aircraft. It also sells fuel; and offers catering, ground handling, and maintenance services for third parties. The company was formerly known as UAL Corporation and changed its name to United Continental Holdings, Inc. in October 2010. United Continental Holdings, Inc. was founded in 1934 and is based in Chicago, Illinois.

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