Here's What Analysts Are Forecasting For Frontier Group Holdings, Inc. (NASDAQ:ULCC) After Its First-Quarter Results

Shareholders might have noticed that Frontier Group Holdings, Inc. (NASDAQ:ULCC) filed its first-quarter result this time last week. The early response was not positive, with shares down 5.9% to US$5.76 in the past week. Revenues of US$865m arrived in line with expectations, although statutory losses per share were US$0.12, an impressive 27% smaller than what broker models predicted. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Frontier Group Holdings

Taking into account the latest results, the consensus forecast from Frontier Group Holdings' ten analysts is for revenues of US$4.11b in 2024. This reflects a meaningful 14% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Frontier Group Holdings forecast to report a statutory profit of US$0.52 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.08b and earnings per share (EPS) of US$0.46 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the substantial gain in earnings per share expectations following these results.

There's been no major changes to the consensus price target of US$7.64, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Frontier Group Holdings, with the most bullish analyst valuing it at US$9.00 and the most bearish at US$6.00 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Frontier Group Holdings' revenue growth is expected to slow, with the forecast 19% annualised growth rate until the end of 2024 being well below the historical 34% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.7% annually. So it's pretty clear that, while Frontier Group Holdings' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Frontier Group Holdings following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Frontier Group Holdings going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Frontier Group Holdings that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.