Frontier Group Holdings, Inc. (NASDAQ:ULCC) Just Reported And Analysts Have Been Cutting Their Estimates
It's been a pretty great week for Frontier Group Holdings, Inc. (NASDAQ:ULCC) shareholders, with its shares surging 10% to US$3.52 in the week since its latest quarterly results. Revenues of US$912m were in line with expectations, although statutory losses per share were US$0.19, some 13% smaller than was expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
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NasdaqGS:ULCC Earnings and Revenue Growth May 6th 2025
Taking into account the latest results, Frontier Group Holdings' ten analysts currently expect revenues in 2025 to be US$3.80b, approximately in line with the last 12 months. Earnings are expected to tip over into lossmaking territory, with the analysts forecasting statutory losses of -US$0.24 per share in 2025. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.03b and earnings per share (EPS) of US$0.25 in 2025. The analysts have made an abrupt about-face on Frontier Group Holdings, administering a minor downgrade to to revenue forecasts and slashing the earnings outlook from a profit to loss.
View our latest analysis for Frontier Group Holdings
The average price target was broadly unchanged at US$4.83, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Frontier Group Holdings analyst has a price target of US$10.00 per share, while the most pessimistic values it at US$3.00. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Frontier Group Holdings' past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.8% by the end of 2025. This indicates a significant reduction from annual growth of 11% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.8% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Frontier Group Holdings is expected to lag the wider industry.
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