Wheels Up Experience (NYSE:UP) - Share price, News & Analysis

Q: What is the Fair Price of UP when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

UP ($2.81) is trading below our estimate of [[fair value]] ($34.57)

UP fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	0/6
Financial Health	4/6
Dividends	0/6

UP Stock Overview

Wheels Up Experience Inc. provides private aviation services primarily in the United States.

Rewards

Trading at 91.9% below our estimate of its fair value

Revenue is forecast to grow 13.42% per year

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years

Volatile share price over the past 3 months

Wheels Up Experience Competitors

Blade Air Mobility

NasdaqCM:BLDE

US$475.0m

Hawaiian Holdings

NasdaqGS:HA

US$867.9m

Sun Country Airlines Holdings

NasdaqGS:SNCY

US$1.1b

SkyWest

NasdaqGS:SKYW

US$1.2b

Price History & Performance

Summary of all time highs, changes and price drops for Wheels Up Experience
Historical stock prices
Current Share Price	US$2.81
52 Week High	US$8.89
52 Week Low	US$1.81
Beta	0
1 Month Change	37.07%
3 Month Change	13.31%
1 Year Change	-66.71%
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-70.88%

Recent News & Updates

Aug 08

Wheels Up Set To Take Flight

Travel hiccups continue to make private aviation appealing. Wheels Up has a high level of brand recognition that will appeal to investors and travelers alike. Strong leadership and a lack of debt will help Wheels Up in the future, so the stock continues to be appealing from a valuation perspective. Flying can be akin to roulette these days. Flight cancellations due to coronavirus restrictions, pilot shortages, and weather delays are widespread. Thousands of flights have been delayed or canceled this summer. In fact, more flights in 2022 have been canceled through mid-year 2022 than all of 2021. In addition, some airports have capped the number of departing passengers. Schiphol Airport in Amsterdam has capped passengers to 67,500 per day, while Heathrow Airport in London has capped the number of departing travelers to 100,000 per day. Flight cancelations in the United States continue to be significant as well. La Guardia Airport tops the list with 8% of flights canceled. Newark Liberty International, St. Louis Lambert International, and Raleigh-Durham International had 6% of their flights canceled. Still, corporate executives and wealthy individuals want and need to travel. We believe that the private aviation industry is absorbing that demand. In our opinion, many of these CEOs and wealthy individuals may find that once they experience private aviation, they don't want to return to traditional airports. Wheels Up Experience Inc. (UP) has strong brand recognition and is set to continue to be a lead player. Robust, experienced leadership and attractive valuation make Wheels Up a buy for us at these levels. Disclosure: Risks of Investing in Microcap Stocks With a share price of less than $3 and a market capitalization of just $500 million, Wheels Up is considered a microcap stock. There are many risks in investing in microcap stocks, including increased volatility and potential lack of liquidity. While we recommend Wheels Up as a medium-term investment, we urge investors to approach Wheels Up cautiously and as part of a larger, balanced investment strategy. We would not recommend this stock to risk-averse or conservative investors. Wheels Up Experience Inc. Overview Wheels Up Experience is one of the largest private aviation companies, providing a comprehensive portfolio of services to non-owner fliers as well as jet owners. The company has over 200 aircraft in their owned and leased fleet, and offers access to over 1,200 third-party aircraft, including multiple aircraft types and categories. This includes aircraft in the jet light, mid-size jet, super mid-sized jet, and large cabin jet categories. The company also maintains a strategic partnership with Delta Air Lines (DAL). Their app enables travelers to search and book flights quickly from their smartphones. Their membership program offers clients enhancements like empty-leg hot flights, flight sharing, shuttle flights, company events, and other member benefits from luxury brands. In addition to simplifying the experience, acquisitions have been a part of their growth. In May 2019, Wheels Up acquired Travel Management Company, which is a light jet operator in Indiana. In September 2019, the company acquired Avianis, a flight management system provider. In 2020, the company acquired Delta Private Jets, which is Delta's private aviation branch. This gave Delta a 27% equity stake in Wheels Up. In March 2020, Wheels Up acquired Gama Aviation Signature, and in 2021, it purchased Mountain Aviation, which provides maintenance and operation services for Cessna Citation Xs. Wheels Up reported $1.2 billion in revenue for 2021. This is up significantly from $695 million in 2020 and $385 million in 2019. Wheels Up Experience Financial Overview On May 21, Wheels Up reported its first quarter financial results for the period ended March 31, 2022: Revenue grew to $325.6 million for an increase of 24% Active members reached 12,424 for an increase of 25% Live flight legs were 17,625 for an increase of 26% Net loss was $56.8 million versus a net loss of $89 million in the same quarter last year Adjusted EBITDA was $40.8 million versus $49.4 million in the same quarter last year Stock Performance Wheels Up Experience went public on July 14, 2021. On July 16, it closed at $10.25. It declined to $7.01 on October 29, 2021, yet saw a brief rise to $7.80 on November 5. Since that time, UP has declined steadily and now trades in the $2.25 to $2.50 range.

Jun 23

Todd Smith to join Wheels Up Experience as CFO

Todd Smith has been appointed as the new CFO of Wheels Up Experience (NYSE:UP). Smith starts on June 30, 2022 and will oversee all aspects of the company's global finance organization, including commercial finance, accounting, FP&A, treasury, tax and investor relations. He will also join the company's executive leadership team. Most recently, Smith served as Global Head of Financial Planning and Analysis and CFO for GE Corporate (GE).

May 17

Wheels Up Experience Inc. (NYSE:UP) Just Reported First-Quarter Earnings And Analysts Are Lifting Their Estimates

Wheels Up Experience Inc. ( NYSE:UP ) defied analyst predictions to release its quarterly results, which were ahead of...

Shareholder Returns

	UP	US Airlines	US Market
7D	14.7%	2.7%	3.2%
1Y	-66.7%	-20.6%	-10.1%

Return vs Industry: UP underperformed the US Airlines industry which returned -24% over the past year.

Return vs Market: UP underperformed the US Market which returned -11.7% over the past year.

Price Volatility

Is UP's price volatile compared to industry and market?
UP volatility
UP Average Weekly Movement	12.5%
Airlines Industry Average Movement	8.1%
Market Average Movement	7.7%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	3.2%

Stable Share Price: UP is more volatile than 75% of US stocks over the past 3 months, typically moving +/- 12% a week.

Volatility Over Time: UP's weekly volatility (12%) has been stable over the past year, but is still higher than 75% of US stocks.

About the Company

Founded	Employees	CEO	Website
2013	2,700	Kenny Dichter	https://www.wheelsup.com

Wheels Up Experience Inc. provides private aviation services primarily in the United States. The company offers a suite of products and services, which include multi-tiered membership programs, on-demand flights across various private aircraft cabin categories, aircraft management, retail and wholesale charter, whole aircraft acquisitions and sales, corporate flight solutions, special missions, signature events and experiences, and commercial travel. It operates a fleet of approximately 1,500 aircraft.

Wheels Up Experience Fundamentals Summary

How do Wheels Up Experience's earnings and revenue compare to its market cap?
UP fundamental statistics
Market Cap	US$686.41m
Earnings (TTM)	-US$315.87m
Revenue (TTM)	US$1.40b

0.5x

P/S Ratio

-2.2x

P/E Ratio

Is UP overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
UP income statement (TTM)
Revenue	US$1.40b
Cost of Revenue	US$1.31b
Gross Profit	US$84.29m
Other Expenses	US$400.15m
Earnings	-US$315.87m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-1.29
Gross Margin	6.03%
Net Profit Margin	-22.59%
Debt/Equity Ratio	0%

How did UP perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is UP undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for UP?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for UP. This is calculated by dividing UP's market cap by their current preferred multiple.
What is UP's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$686.41m

UP key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.3x
Enterprise Value/EBITDA	-1.3x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does UP's PS Ratio compare to its peers?

UP PS Ratio vs Peers

The above table shows the PS ratio for UP vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	1.4x
BLDE Blade Air Mobility	3.4x	24.0%	US$475.0m
HA Hawaiian Holdings	0.4x	15.5%	US$867.9m
SNCY Sun Country Airlines Holdings	1.5x	23.2%	US$1.1b
SKYW SkyWest	0.4x	8.1%	US$1.2b
UP Wheels Up Experience	0.5x	13.4%	US$686.4m

Price-To-Sales vs Peers: UP is good value based on its Price-To-Sales Ratio (0.5x) compared to the peer average (1.4x).

Price to Earnings Ratio vs Industry

How does UP's PE Ratio compare vs other companies in the US Airlines Industry?

Price-To-Sales vs Industry: UP is good value based on its Price-To-Sales Ratio (0.5x) compared to the US Airlines industry average (0.6x)

Price to Sales Ratio vs Fair Ratio

What is UP's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

UP PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.5x
Fair PS Ratio	0.5x

Price-To-Sales vs Fair Ratio: UP is good value based on its Price-To-Sales Ratio (0.5x) compared to the estimated Fair Price-To-Sales Ratio (0.5x).

Share Price vs Fair Value

What is the Fair Price of UP when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: UP ($2.81) is trading below our estimate of fair value ($34.57)

Significantly Below Fair Value: UP is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Future Growth

How is Wheels Up Experience forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

7.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: UP is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: UP is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: UP is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: UP's revenue (13.4% per year) is forecast to grow faster than the US market (7.9% per year).

High Growth Revenue: UP's revenue (13.4% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: UP is forecast to be unprofitable in 3 years.

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Past Performance

How has Wheels Up Experience performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-37.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: UP is currently unprofitable.

Growing Profit Margin: UP is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: UP is unprofitable, and losses have increased over the past 5 years at a rate of 37.9% per year.

Accelerating Growth: Unable to compare UP's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: UP is unprofitable, making it difficult to compare its past year earnings growth to the Airlines industry (7.5%).

Return on Equity

High ROE: UP has a negative Return on Equity (-54.54%), as it is currently unprofitable.

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Financial Health

How is Wheels Up Experience's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: UP's short term assets ($691.9M) do not cover its short term liabilities ($1.3B).

Long Term Liabilities: UP's short term assets ($691.9M) exceed its long term liabilities ($113.9M).

Debt to Equity History and Analysis

Debt Level: UP is debt free.

Reducing Debt: UP had no debt 5 years ago.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: UP has sufficient cash runway for more than 3 years based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if UP has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.

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Dividend

What is Wheels Up Experience current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate UP's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate UP's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if UP's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if UP's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as UP has not reported any payouts.

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Management

How experienced are the management team and are they aligned to shareholders interests?

1.7yrs

Average management tenure

CEO

Kenny Dichter (53 yo)

9yrs

Tenure

US$9,505,783

Compensation

Mr. Kenneth H. Dichter, also known as Kenny, serves as an Operating Partner at Orangewood Partners LLC. He serves as Special Advisor at Rosecliff Ventures. He is Founder, CEO & Chairman of the Board of Whe...

CEO Compensation Analysis

Compensation vs Market: Kenny's total compensation ($USD9.51M) is above average for companies of similar size in the US market ($USD3.92M).

Compensation vs Earnings: Kenny's compensation has increased whilst the company is unprofitable.

Leadership Team

Experienced Management: UP's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.

Board Members

Experienced Board: UP's board of directors are not considered experienced ( 1.1 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/12 00:00
End of Day Share Price	2022/08/12 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31