Spirit Airlines Beats on Both Top and Bottom Lines

Spirit Airlines (Nasdaq: SAVE  ) reported earnings on Feb. 19. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Spirit Airlines beat slightly on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly. GAAP earnings per share shrank significantly.

Gross margins expanded, operating margins dropped, net margins contracted.

Revenue details
Spirit Airlines reported revenue of $328.3 million. The six analysts polled by S&P Capital IQ predicted a top line of $324.7 million on the same basis. GAAP reported sales were 20% higher than the prior-year quarter's $273.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.27. The nine earnings estimates compiled by S&P Capital IQ predicted $0.25 per share. GAAP EPS of $0.27 for Q4 were 18% lower than the prior-year quarter's $0.33 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 43.0%, 1,500 basis points better than the prior-year quarter. Operating margin was 9.8%, 450 basis points worse than the prior-year quarter. Net margin was 6.0%, 280 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $364.4 million. On the bottom line, the average EPS estimate is $0.41.

Next year's average estimate for revenue is $1.60 billion. The average EPS estimate is $1.95.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 85 members out of 107 rating the stock outperform, and 22 members rating it underperform. Among 33 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 26 give Spirit Airlines a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Spirit Airlines is outperform, with an average price target of $26.75.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of SPIRIT AIRLINES INC. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On February 19, 2013, at 10:13 PM, sharkflyt wrote:

    Spirit Airlines has the best credit card program than any other airline. You would be nuts not to sign up on the aircraft because you get 17,500 miles just to start and they have round trips for as little as 5000 miles. The miles are transferable and do not expire plus you get 2 miles for every dollar spent. I use them to give friends and family tickets to come see me in Las Vegas. Boy do they love that all for just doing my normal monthly shopping with the Spirit World Mastercard. It doesn't get better than that. Who cares about bag fees at that point plus they discount all the snacks and cocktails on the plane. Other airlines are double the price!

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