Virgin America (VA) Soars As Q4 Crushes Estimates

Virgin America Inc. (VA) shares are up 7% to $36.56 in morning trading Wednesday after the company reported its fourth quarter earnings results.

In its first quarterly report since its November IPO, the air carrier said excluding non-recurring items, adjusted EPS were $1.16 per share on revenues of $372.2 million. Analysts were expecting EPS of $0.80 on revenues of $368.8 million. Load factor improved to 81.2% from 78.5% yoy, as traffic increased 2.7%. Fuel cost per gallon declined 7% to $2.93.

“2014 was a remarkable year for Virgin America on every front,” commented David Cush, Virgin America’s President and CEO. “We achieved record profitability and significantly strengthened our balance sheet by going public in the second largest airline IPO in history.”

On valuation measures, Virgin America Inc. shares, which currently have an average 3-month trading volume of 1.8 million shares, trade at a trailing-12 P/E of 14.17, a forward P/E of 8.38 and a P/E to growth ratio of 0.12. The median Wall Street price target on the name is $44.50 with a high target of $53.00.

Profitability-wise, VA has a t-12 profit and operating margin of 4.76% and 7.44%, respectively. The $1.55B market cap company reported $184.45M in cash vs. $117.93M in debt in its most recent quarter.

VA currently prints a year-over-year gain of 21.23%, and year-to-date loss of around 16%.

The chart below shows where the equity has traded over the last 52 weeks.

Virgin America Inc. is a low-cost airline that provides scheduled air travel services in the continental United States and Mexico. The carrier was incorporated in 2004 and is headquartered in Burlingame, California.

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