2024-05-13 07:02:18 ET
Summary
- Spirit Airlines' Q1 performance was underwhelming, with a decline in profitability and revenue.
- The airline's heavy investment in aircraft raises liquidity concerns and potential bankruptcy risks.
- The disappointing results have shaken investor confidence and may hinder debt restructuring, impacting financial stability.
Investment Thesis
While I have been historically bullish on Spirit Airlines ( SAVE ), I found their performance in the first quarter as very underwhelming. Spirit reported a Non-GAAP EPS of -$1.46 , indicating a substantial decline in profitability, on top of revenue dropping to $1.27 billion, a 6.24% decrease year-over-year??. Based on these numbers, I believe it seems that Spirit is not executing as well as I expected them to do as a stand-alone airline when I previously wrote on them back in late February....
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For further details see:
Spirit Q1: No Longer Taking Off (Rating Downgrade)